Ali Group Submits Binding All-Cash Proposal To Acquire Welbilt

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Ali Group today confirmed that it has submitted a definitive proposal and merger agreement to the board of directors of Welbilt to acquire all outstanding shares of Welbilt common stock for $24 per share in cash, according to a press release. The proposal marks an increase from the previously disclosed $23 per share cash proposal made by Ali Group on May 25.

Ali Group’s new proposal represents a premium of 3.5% to the Welbilt closing share price on July 2 (the last trading day prior to the July 5 definitive proposal), a premium of approximately 11.4% to the implied value of the all-stock transaction with the Middleby Corp. as of July 2 (the last trading day prior to Ali Group submitting its proposal to Welbilt), and a premium of 53.6% to the closing share price on April 20 (the last trading day prior to announcement of the Middleby transaction), the press release states.

“Ali Group has obtained fully underwritten, binding commitment letters for debt financing from Goldman Sachs Int’l. and Mediobanca,” the press release continues. “The Ali Group proposal also provides certainty of securing regulatory approval with the inclusion of a ‘hell or high water’ provision, which requires Ali Group to take all actions necessary, including divestitures, to obtain all requisite antitrust approvals without undue delay. Ali Group looks forward to promptly executing a definitive merger agreement with Welbilt to bring together the two companies’ highly complementary portfolios of foodservice equipment and solutions.”

Ali Group issued the following statement:

“We are pleased to present the Welbilt Board of Directors with the compelling, certain and upfront value of our fully financed, all-cash offer to acquire Welbilt for $24.00 per share, which provides even greater value than our initial proposal and includes the certainty of a “hell or high water” provision. Ali Group has completed due diligence and secured committed financing, and our proposal continues to be superior in every respect to Welbilt’s pending all-stock transaction with Middleby, with a significant premium to Welbilt shareholders and a clear path to completion. Further, given the minimal product overlap between our two companies and the fact that our proposed transaction does not require an Ali Group stockholder vote, we believe our proposal offers far greater certainty of closing than the Middleby Transaction.

“We firmly believe our proposal represents the most attractive opportunity for Welbilt shareholders and expect the Welbilt Board of Directors to deem our all-cash proposal superior to the pending all-stock transaction with Middleby. We have long admired Welbilt’s heritage, breadth of products, brand strength and management team, and look forward to executing a definitive merger agreement, welcoming Welbilt and its employees to the Ali Group family and creating an industry leader with a comprehensive product portfolio and global footprint.”

Update: Welbilt posted a press release July 6 confirming receipt of the revised proposal from Ali Group, and Middleby reiterated its “conviction behind superiority of agreed transaction with Welbilt” in its updated Q2 forecast.



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