US earth imagery group DigitalGlobe acquries GeoEye in $900m deal

US earth imagery products provider DigitalGlobe Inc (NYSE:DGI) has sealed a USD900m (EUR741.8m) definitive deal to acquire geospatial information firm GeoEye Inc (NASDAQ:GEOY).

With this tie-up, the parties will form a global leader in earth imagery and geospatial analysis, they said jointly on Monday.

The agreement, unanimously cleared by both boards, provides GeoEye’s stockholders with the option to choose whether they will receive DigitalGlobe shares, cash or a mixture between the two in exchange for their own units. They will have the right to elect an all-cash payment of USD20.27 apiece or to get 1.425 common shares of DigitalGlobe. If they choose a combination, they will receive USD4.10 a share in cash plus 1.137 common units for each of their own.

The transaction carries a premium of 34% to GeoEye’s closing stock price on 20 July, based on DigitalGlobe’s closing on the same date. Once the move is concluded, which is expected to happen in the fourth quarter of the current year or the first quarter of 2013, GeoEye’s shareholders will have a 36% stake in the combined entity.

Jeffrey Tarr, the current president and CEO of DigitalGlobe, will continue to lead the Colorado-based business following the combination. The enlarged company will conservatively have a pro forma revenue base of over USD600m in 2012, after adjusting for the planned lower US government funding programme for fiscal 2013. It will also have five existing earth observation satellites and two under construction.

The merger needs to be greenlighted by both regulators and GeoEye stockholders. The latter’s biggest shareowner, Cerberus Capital Management LP, has already agreed to vote in favour of the deal. DigitalGlobe has obtained a USD1.2bn fully committed funding to refinance the outstanding debt of the resulting entity.

Investor Cerberus has noted it may invest in DigitalGLobe shares in advance of the complation of the combination.

US private equity sponsor Ceberus exits Guilford Mills in $257m deal

US private equity major Cerberus Capital Management LP said it had completed its exit from Guilford Mills Inc, selling the North Carolina-based manufacturer of automotive and speciality fabrics for USD257m (EUR205m).

The business was acquired by Lear Corporation (NYSE:LEA), the US automotive industry supplier of seating and electrical power management systems. The transaction, which was conducted through a Cerberus affiliate, was finalised on 31 May 2012. The private equity group bought Guilford in 2004.

Dev Kapadia, managing director at Cerberus, said that his company was pleased with the closure of the sale, which places Guilford under the wing of a world-class corporation. The deal with Lear represents the achievement of a key objective for Cerberus since it leaves Guilford in the hands of a market-leading enterprise.

Under the ownership of Lear, Guilford will be able to reach new heights in terms of performance and success. This has proved a good investment for Cerberus, which is proud of its contribution to Guilford’s achievements over the course of their partnership, Kapadia stated.

Guilford’s former chairman Chan Galbato said that the support provided by Cerberus had helped Guilford become a market leader in the automotive and specialty fabrics business. The partnership had made it possible for Guilford to streamline production, launch best-in-class products and assemble an exceptionally strong management team, Galbato added.

Sponsor Ceberus takes Isle of Man-based Spaymill out of receivership

US private equity firm Cerberus Capital Management LP said today it had inked a deal to take Isle of Man-based, pan-German residential investor Speymill Deutsche Immobilien Company plc (LON:SDIC) out of receivership.

The buyout firm has collaborated with Spreymill’s bank lenders to restructure the firm’s EUR985m (USD1.26bn) worth of distressed bank loans. The troubled company has received subordinated debt and equity which will be used to pay down its debt and to improve its assets, Cerberus said. The investor expects to finalise the transaction later this week.

Cerberus’ senior managing director, Lee Millstein, believes that all parties benefit from this transaction as the lenders will have a large portfolio of non-performing loans converted to performing ones, while the company will secure a capital injection. According to one of the receivers, Ben Cairns of Ernst & Young LLP, the move represents a “landmark recapitalisation and distressed loan restructuring”.

Spreymill’s lenders are a group of banks led by Dutch NIBC Bank NV as well as German HSH Nordbank AG and Norddeutsche Landesbank. Kuna & Co KG and Freshfields Bruckhaus Deringer LLP consulted Cerberus in this transaction.

New York City-based Cerberus is a private equity investor with nearly USD20bn (EUR15.7bn) under management and offices in the US, Europe and Asia. The firm has been investing in Germany since 2002. In April 2011, Cerberus and a co-investor executed the country’s biggest IPO for the year by listing Berlin-based GSW Immobilien AG (FRA:GIB) on the Frankfurt stock exchange.