Steinway Musical Instruments has received a definitive offer to acquire all of the outstanding shares of the company’s common stock at a purchase price of $38 per share in cash from Paulson & Co. which exceeds the $35 per share proposal the company received last month from Kohlberg & Co.
According to published reports, Paulson & Co. has teamed with interim Steinway CEO Michael Sweeney on the $38 per share offer which equates to an equity value of $475 million. The Paulson offer also includes a fully negotiated merger agreement and financing commitments.
Steinway has announced, after consideration and consultation with its financial advisors, legal counsel, and the company’s board of directors, that the Paulson offer constitutes a superior proposal to the $438 million offer from Kohlberg. Kohlberg has until August 14, 2013 to make adjustments to the terms and conditions of its prior offer for Steinway.
Steinway Musical Instruments, through its Steinway and Conn-Selmer divisions, is a designer, manufacturer, marketer and distributor of musical instruments. These products include Bach Stradivarius trumpets, Selmer Paris saxophones, C.G. Conn French horns, Leblanc clarinets, King trombones, Ludwig snare drums and Steinway & Sons pianos. Through its online music retailer, ArkivMusic, the company also produces and distributes classical music recordings. Steinway is based in Waltham, MA (www.steinwaymusical.com).
Paulson & Co. is an investment management firm established by its founder and President, John Paulson in 1994. The firm has approximately $24 billion in assets under management. Paulson & Co. has approximately 120 employees in offices located in New York, London and Hong Kong (www.paulsonco.com).
Kohlberg & Company invests in companies in the industrial manufacturing; consumer products; business services; healthcare services; and financial services sectors. The firm concentrates on transactions with EBITDAs between $20 million and $100 million where it can invest between $50 million and $200 million of equity. Kohlberg & Company is currently investing its seventh private equity fund, Kohlberg Investors VII. The firm was founded in 1987 and is based in Mt. Kisco, NY (www.kohlberg.com).
© 2013 PEPD • Private Equity’s Leading News Magazine • 8-13-13
