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Superior Telecom buys Essex
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October 22, 1998: 9:37 a.m. ET
Telecom cable and wire equipment manufacturer paying $1.4B for rival
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NEW YORK (CNNfn) - Superior Telecom Inc. agreed Thursday to buy rival Essex International Inc., the largest producer of magnet wire products in North America, in a deal valued at roughly $1.4 billion.
Under terms of the deal, Superior Telecom will acquire all of Essex's outstanding shares and options for $936 million. Of that, $769 million will be in cash and the remaining $167 million in liquidation value of new preferred stock.
Superior, a manufacturer and supplier of telecommunications equipment, will assume another $419 million of Essex's debt.
The company also will make a cash tender offer of $32 per share for up to 81 percent of Essex's outstanding common shares, a solid premium over the company's trading price.
Essex shares (SXC) finished up 1-7/16 at 23-3/16 Wednesday on the Big Board.
Both companies' boards already have approved the deal, which is expected to close in the first quarter of 1999.
"The acquisition of Essex International by Superior TeleCom is a strategically sound transaction that merges two world-class wire and cable businesses known for quality, customer service and delivering value to customers, shareholders and employees," Superior Chairman and Chief Executive Officer Steven S. Elbaum said "The combination will greatly benefit our customers and will significantly expand Superior's operations and establish Superior as the premier producer of wire and cable in North America and fourth largest in the world."
Once the merger is complete, Essex President and Chief Executive Steven R. Abbott will become president and chief operatingofficer of Superior.
(Click here for a chart of Superior Telecom's stock activity)
Shares of Superior Telecom (SUT) closed up 1/8 Wednesday at $46 per share on the New York Stock Exchange. 
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