Steinway Agrees to Acquisition by Paulson & Co.
High-end musical instruments maker Steinway Musical Instruments Inc. (NYSE: LVB) has agreed to be acquired by affiliates of private equity firm Paulson & Co. for a purchase price of $40 a share, or about $512 million. A Paulson company will…
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And why not? The initial offer to take the company private from Kohlberg & Co. came in at $35 a share. Steinway reported on Monday that it had received a second offer of $38 a share from an unnamed investment firm that ultimately turned out to be Paulson, and the final deal boosts the cash price to $40 a share. What’s not to like?
Steinway will have to pay a breakup fee of about $6.7 million to Kohlberg, which amounts to about $0.50 or so per outstanding share. Pending regulatory approvals, the deal is expected to close in late September.
Shares of Steinway are up about 5% in premarket trading, at $40.25 in a prior 52-week range of $20.61 to $39.90.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.