Temporary power supplier APR Energy has agreed to a £165 million takeover by a consortium including its biggest shareholder, after a year dogged by the loss of projects in conflict zones.
The buyers, a group comprising Fairfax Financial Holdings, ACON Equity Management and Albright Capital Management, will pay 175 pence a share in cash to take APR private.
APR's shares were trading at the offer price as of noon, down about two per cent.
They have risen about 88 per cent since October 2, the last trading day before APR said it was in talks with the consortium.
Jacksonville, Florida-based APR rents out turbines and generators to cover electricity shortfalls, often in developing markets, where demand has grown as utilities have struggled to keep pace with rapid economic growth.
It is a rival to larger Scottish based Aggreko.
But APR's particular focus on emerging markets has also left it exposed to conflict and political tension. The collapse of a major contract in Libya preceded the company's exit from Yemen in April, due to fighting there.
The suspension of its Libyan contract - the company's largest ever, accounting for more than a third of its revenue last year - pushed APR to the brink of breaching its debt covenants.
The company secured a renegotiation on its credit facility in April, thus avoiding a breach, and was later granted a month's extension of its next covenant testing date of September 30.
The consortium bidding for APR intend to supply $200 million of additional funding to the company within 31 business days of its offer being declared unconditional.
About $150 million of this will be used to repay debt and the rest will be used for working capital and transaction costs.
"Given the volatility of the market, combined with the capital-intensive nature of the business, we believe that APR Energy would benefit from a period as a privately held company as it seeks financial stability," Fairfax Financial chairman and chief executive Prem Watsa said.
General Electric Co, which owns about 16.4 percent of APR's issued share capital through a subsidiary, has agreed to the offer, as have APR's directors.
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