FOXBORO, Mass. -- Foxboro Co. said Monday it has agreed to be acquired by Siebe PLC, a British controls manufacturer, for $52 a share in cash, translating into a total takeover price of about $656 million.
If it is approved by Seibe's shareholders and passes U.S. antitrust review, the deal could be completed 'certainly by the end of July,' said John C. Fuller, a company spokesman.
The price is almost $14 a share more than the $38.125 a share Foxboro stock closed at in New York Stock Exchange trading Friday. The stock shot up and hovered around $51 a share in afternoon trading Monday.
Negotiations between Seibe and Foxboro ended Saturday and the deal was endorsed by the Foxboro board of directors during a special meeting, said Gary T. Willis, Foxboro's chairman, president and chief executive officer.
The companies said a tender offer for all 12.6 million Foxboro shares will start Friday.
Seibe has received commitment letters from various U.S. and British banks to fund the transaction, the companies said in a statement.
Barrie Stephens, Seibe's vice chairman and chief executive officer, said Foxboro will keep its headquarters in Foxboro, Mass., and operate as the British company's U.S. subsidiary. Foxboro's current management will also be retained, Fuller said.
However, he made no mention of manufacturing or employment. Foxboro currently employs about 4,000 workers in Massachusetts. Fuller, who is a member of the family that founded the company in 1908, said Foxboro has never given assurances about employment levels.
'I don't think anyone can say anything about that, nor should we, even if we weren't merging,' Fuller said, adding: 'It's way too early to know what is going on with operations, although Foxboro will be the core of their industrial controls group.'
He said the company last month established an employee protection plan 'so that all employees will have a minimum of six months of pay and benefits if they were terminated. I say minimum because it could be more under state law or other company policies.'
Willis called Seibe 'an ideal merger partner.' He said Seibe's concentration in industrial instruments, commercial heating, ventilation and air conditioning and building management would mesh with Foxboro's industrial process control and automation business.
Willis disputed suggestions that pressure from founding family members, who still own directly or via trusts about 30 percent of the company's stock, forced the sale.
Instead, Willis said, the company recognized a changing competitive environment in which multinational companies are merging and creating 'a whole new set of bigger competitors' in the process control industry.
That, combined with growing opportunities in Eastern Europe and the Far East, prompted the company to start looking for strategic partners several months ago, he said.
'It would be unfair and not accurate to indicate that the investment desires of asingle shareholder constituency drove this,' Willis said.
Seibe had been one of several companies, including several U.S. corporations, that expressed an interest in Foxboro, Willis added.
The British company, which did about $2.35 billion in sales last year, is nearly four times the size of Foxboro.