Domnick Hunter in take over talks with two US firms |
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Sun, 28 Aug 2005 16:05
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LONDON - Two American companies are vying with each other to take over British manufacturer of air filters Domnick Hunter. US- based electrical systems manufacturer Eaton Group bettered a rival bid by offering £242 million for the Tyne & Wear-based company that specializes in manufacturing filters capable of purifying air from "all known chemical weapon and biological weapon agents."
These filters can clear agents such as sarin gas, hydrogen cyanide, and the anthrax and cholera bacteria from the air. No wonder firms have been interested in acquiring Domnick. The increasing frequency of polluted air as well as the looming threat of bioterrorism makes these filters invaluable. Domnick Hunter's business profile is basically focused on making filters for the food, drinks, drugs and compressed gases segments, but lately the company has made giant strides in manufacturing products for the defense industry with Nuclear Biological Chemical (NBC) protection systems.
Earlier US firm Parker Hannifin had made a revised bid worth £232 million for Domnick Hunter. This bid beat its own offer of £215.7 million that was made earlier this month. Eaton's bid amounts to 675 pence-a-share while, Parker's bid values the company at 650 pence-a-share. The juicy prospect of an intense bidding war pushed Domnick Hunter shares up by 6.3 percent to 716 pence. Commenting on the decision to bid for Domnick Hunter, Alexander Cutler, Eaton's chief executive, said, "Domnick Hunter is a strong business and will add valuable scale and market leadership to our competitive position."
Dominic Chairman Brian Thompson, chief executive Colin Billiet and group finance director Chris Gill would get a lion's share of the £17 million if the Eaton bid were accepted. However, their futures are unclear if Eaton is successful, but they would retain their positions under Parker Hannifin's deal. Both the US firms are robustly growing ones with sales of $8.5billion (£4.7billion) a year.
One analyst was quoted as saying that the bidding might go on as pride was at stake here, "Both are in a position where what they pay for Domnick Hunter will almost come out of their back pocket," he commented. The company declined to comment on the prospect of an intense bidding war, but released a statement saying, "The board of Domnick Hunter continues to be in discussions with only Parker Hannifin International Corporation and Eaton Industries Limited."
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