Rhone offers to buy stake in RHI Magnesita at 40% premium

(Alliance News) - Shareholders of RHI Magnesita NV on Tuesday received an offer for a 20% stake in the company that values RHI as a whole at GBP1.38 billion in total.

Ignite Luxembourg Holdings Sarl, a company indirectly managed by Rhone Holdings VI LLC, offered to buy a 20% stake in RHI Magnesita at GBP28.5 per share in cash, a 39% premium to the stock's close on Friday.

RHI Magnesita shares were up 22% at 2,502.00 pence early Tuesday in London. The stock now is up 3.7% over the past 12 months, having been down 15% before Tuesday.

Rhone said it aims to buy a non-controlling minority stake in the Vienna-based supplier of refractory products. It said the offer is "an opportunity for shareholders of the company to crystallise their investment in the company as a compelling valuation and significant premium".

Rhone said it will seek representation on the RHI Magnesita board. It said no relationship agreement or other governance arrangement has been agreed between the two companies.

The offer values all of RHI Magnesita at GBP1.34 billion, or at GBP1.38 billion including a GBP0.95 per share dividend recently declared by RHI Magnesita.

The financial adviser to Rhone for the deal is Citigroup Global Markets Ltd.

By Tom Waite, Alliance News editor

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