|
GUS buys Metromail
|
 |
March 13, 1998: 11:54 a.m. ET
Burberry owner hopes to chase away Metromail's recently stormy finances
|
NEW YORK (CNNfn) - Britain's Great Universal Stores Plc, whose holdings include raincoat maker Burberry, is buying U.S. marketing database company Metromail Corp. in a stock and debt deal worth $831 million.
Great Universal (GUS) will pay $31.50 for each share of Metromail, whose stock (ML) has been trading at around $25 per share.
GUS is a London-based holding company with interests in home shopping, overseas retailing, information services and property investment.
GUS is also the owner of Burberry's, the apparel manufacturer best-known for its raincoats. Aside from its U.K. holdings, GUS also has a foothold in the United States.
GUS is currently in a hostile $2.6 billion takeover bid for British catalog retailer Argos Plc.
Metromail moved quickly after announcing in February that it was looking at alternatives to boost its shares. The company is attempting to stay ahead of a wave of consolidation within the marketing industry.
The company, headquartered in Lombard, Ill., provides direct marketing database products and services to companies in the United States and United Kingdom. The company uses its computer database, which has information on more than 95 percent of U.S. households, to help its customers reach target audiences.
GUS will be picking up a financially-mixed company whose yearly sales increased 17 percent in 1997 to more than $328 million.
However, Metromail, reported a pretax loss of $2.9 million in 1997 after one-time charges of $36.9 million to pay for the acquisition of software and database company Saxe Inc., and also to cover bad debts.
Chairman Lord Wolfson said he hoped the acquisition would help GUS "be much better placed to meet the growing demand from organizations for comprehensive information about existing and prospective customers."
The deal has been approved by the boards of both companies, and GUS said it has received assurances of support from a group of investors who together hold 40 percent of Metromail's stock.
|
|
|
|
|
 |
|
