Tadiran Telecommunications and ECI Telecom today officially announced that they have signed an agreement in principle for a merger.
Tadiran Telecommunications and ECI Telecom today officially announced that they have signed an agreement in principle for a merger. Under the agreement, the parties will now start negotiating the merger of Tadiran Telecommunications with ECI. Assessments that such a merger will take place were reinforced recently, and Tadiran is now officially announcing, for the first time, that negotiations are in fact being conducted on the matter. The company notes that the merger will enable the technological and marketing potential of the two companies in the world communications equipment market to be fully utilised.
According to the agreement in principle, the shareholders of Tadiran Telecommunications will receive one ECI share for each 1.79 Tadiran Telecommunications shares they hold. Previous assessments specified 1.8 ECI shares per Tadiran Telecommunications share. The ratio will ultimately be determined based on mutual due diligence examinations. The conversion ratio expresses a premium of 16.8%, based on the average price of the two companies’ shares on the stock exchange in the past sixty trading days.
Effectuation of the merger is contingent on a binding agreement approved by the boards of Tadiran, Tadiran Telecommunications and ECI, and approved by the shareholders of the different companies. It is also subject to court approval and approvals from other entities such as the Income Tax Commission. The merger is scheduled to take place in the first quarter of 1999, effective as of December 31 1998. Tadiran Telecommunications and ECI at once commenced negotiations and mutual due diligence.
Published by Israel's Business Arena September 8, 1998