Summary
Johnson Controls International plc (JCI), via its affiliate Tyco International Ltd., has entered into a non-binding Letter of Intent (LOI) with Atkore International Group Inc. to sell its remaining common equity stake in Atkore for approximately $250 million in cash, plus a potential contingent amount. This proposed transaction signifies JCI's strategic move to divest its remaining interest in Atkore, which is expected to close in the third fiscal quarter of 2014. The deal is contingent on several factors, including the finalization of a definitive agreement, the refinancing of Atkore's debt, Atkore's financial stability post-transaction, and the termination of existing affiliate agreements.
Key Highlights
- 1JCI, through its affiliate Tyco, proposes to sell its remaining stake in Atkore International Group Inc.
- 2The proposed transaction is for an aggregate cash purchase price of $250 million, with a potential additional contingent amount.
- 3The divestiture is a strategic decision to exit JCI's remaining equity interest in Atkore.
- 4The deal is subject to several conditions, including a definitive agreement and Atkore's debt refinancing.
- 5Completion of the redemption is anticipated in JCI's third fiscal quarter of 2014.
- 6The transaction is considered a forward-looking statement, with no assurance of finalization on favorable terms.
Frequently Asked Questions
This 8-K filing announces JCI's intention, through its affiliate Tyco International Ltd., to sell its remaining common equity stake in Atkore International Group Inc. The purpose is to inform investors about this significant divestiture and its potential financial implications.
The proposed divestiture is expected to bring in approximately $250 million in cash, plus a potential contingent amount. This cash infusion could strengthen JCI's balance sheet and provide capital for other strategic initiatives. However, the final amount is subject to the closing of the deal and potential contingencies.
The transaction is subject to several conditions, including the execution of a definitive redemption agreement, the successful refinancing of Atkore's existing indebtedness, confirmation of Atkore's solvency after the transaction, and the termination of specific affiliate agreements between Atkore and JCI's affiliates.
The closing of the redemption is expected to occur in JCI's third fiscal quarter of 2014.