HOUSTON - Quanex (NYSE:NX) Building Products Corporation (NYSE:NX) has announced an amendment to the acquisition terms of Tyman plc, following feedback from Tyman shareholders. In addition to the previously agreed cash and share offer, Tyman shareholders will now also receive a special interim dividend of 15 pence per share, contingent upon the deal's completion.
The initial agreement, announced on April 22, 2024, proposed that Tyman shareholders receive 240 pence in cash and 0.05715 of a Quanex common stock for each Tyman share. Alternatively, shareholders could opt for the Capped All-Share Alternative, exchanging each Tyman share for 0.14288 of a new Quanex share, up to a limit of 25% of Tyman's outstanding shares.
This revision comes after Quanex's management noted the decline in its share price and the unfavorable Dollar to Pound Sterling exchange rate since the announcement. The special dividend aims to address these concerns and enhance the offer's appeal to Tyman's shareholders.
Moreover, Quanex has secured an irrevocable undertaking from Alantra EQMC Asset Management SGIIC, S.A., ensuring the support of approximately 10.05% of Tyman's issued share capital for the acquisition. As of June 28, 2024, Quanex has received commitments from shareholders representing roughly 26.73% of Tyman's issued share capital.
The transaction, which is subject to Tyman shareholder approval and other customary closing conditions, is expected to be implemented through a scheme of arrangement under the UK Companies Act.
Quanex emphasizes that forward-looking statements in this report are based on current management expectations and are subject to uncertainties and changes in circumstances. The company has cautioned that actual results may differ materially from those expressed or implied by such statements.
The information provided in this article is based on a SEC filing by Quanex Building Products Corporation.
In other recent news, Quanex Building Products Corporation is making significant strides in its planned acquisition of Tyman plc. The company has successfully cleared regulatory hurdles, with no further inquiries from the United Kingdom Competition and Markets Authority and the expiration of the waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act.
The acquisition, set to be implemented under the UK Companies Act, still requires approval from both Tyman and Quanex stockholders.
Simultaneously, the company has released its Q2 2024 earnings results, showing growth despite lower volumes and pricing pressures in North America. While net sales and net income have seen a decline year-over-year, Quanex reported a slight increase in adjusted EBITDA and maintained a strong balance sheet with no net debt. The company remains confident, reaffirming its full-year guidance and anticipating an upswing in the housing market and product demand later in the year.
During its Q2 2024 earnings call, Quanex CEO George Wilson expressed optimism about the company's future performance and ongoing research and development initiatives.
Despite challenges in the European market due to geopolitical conflicts and high energy costs, the company's operational flexibility and sourcing initiatives have yielded strong results. These recent developments highlight Quanex's strategic moves and financial resilience amid market challenges.
InvestingPro Insights
In light of Quanex Building Products Corporation's recent developments, a glance at the company's financial metrics and market performance can offer additional context to investors. As of the midpoint of 2024, Quanex has a market capitalization of $926.11 million and trades at a P/E ratio of 11.42, reflecting investor valuation of its earnings.
Notably, the company's price has experienced a significant drop over the last three months, with a 26.37% decrease in total return, which may have influenced the decision to revise the acquisition terms with Tyman.
Despite the recent price decline, Quanex's fundamentals show resilience. The company has a strong track record of maintaining dividend payments, with a history of 17 consecutive years of dividends, and a current yield of 1.13%. Moreover, Quanex's cash flows are robust enough to cover interest payments, and its liquid assets surpass short-term obligations, indicating a solid financial position.
Investors considering Quanex should be aware of the mixed signals in the market. An InvestingPro Tip highlights that the stock's RSI suggests it is currently in oversold territory, which could point to a potential rebound.
On the other hand, three analysts have revised their earnings estimates downwards for the upcoming period, which may warrant caution. For those looking for a deeper dive into Quanex's financial health, there are 9 additional InvestingPro Tips available, which can be accessed with the coupon code PRONEWS24 for an extra 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.