Tessenderlo launches bid for Picanol

08 July 2022
today at
08:44

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It seems that Luc Tack, the West Flemish entrepreneur behind the chemical group Tessenderlo and the loom builder Picanol, is ready for his long-awaited merger. Nine years after joining Tessenderlo, he wants to group all activities into one listed industrial conglomerate with an offer for Picanol.

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Timpani at the Brussels stock exchange: the chemical group Tessenderlo

launches bid for loom manufacturer Picanol

, so that both companies of major shareholder and CEO Luc Tack come under one roof. That teaches a press release.

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The acquisition takes place through an exchange operation. In the offer, Picanol shareholders can exchange each share for 2.43 Tessenderlo shares. At the current price of Tessenderlo (29.75 euros Thursday evening), a Picanol share is valued at 72.29 euros. That is a premium of 17 percent on Thursday’s closing price (61.80 euros). The investment bank Degroof Petercam will assist the independent directors of Picanol to prepare an expert report on the proposed terms of trade in the offer. Freshfields provides legal assistance to the directors.

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In the exchange operation, the interest that Tack has in the Swiss machine builder Rieter through Symphony Mills is transferred to Picanol Group. This means that its value is also taken into account when determining the exchange ratio in the offer. To this end Picanol will convene an extraordinary general meeting. Picanol Group (including the 15.2% in the Swiss listed Rieter Holding AG and excluding Tessenderlo Group shares) is valued relatively at 830.8 million euros.

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Key figures of the Picanol-Tessenderlo . merger group

Turnover 2.7 billion euros.
Gross operating profit: more than 430 million euros (figures for 2021).
7,000 dedicated employees.
Active in more than a hundred countries.

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The reference shareholders Tack and Patrick Steverlynck will hold 64 percent of the total number of shares in the new group as a result of the shareholdings they hold in Picanol Group and Tessenderlo Group as a result of the exchange offer. The rest of the shares will be traded freely on the stock exchange.

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Tack and Steverlynck are being advised by ING on the deal. The stock exchange house KBC Securities and the law firm Stibbe assist the directors of Tessenderlo – the independents of Tessenderlo through Argo Law.

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The mechanical engineering of Picanol will become a fifth division in Tessenderlo Group under the name Machines & Technologies, alongside Agro, Bio-valorization, Industrial Solutions and T-Power (energy production).

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It is not immediately clear what strategy Tack has in mind and where the synergy gains lie between a chemical group and a machine builder. But he is clearly counting on the different economic cycles of both activities. The combination of the cash flows of all business units makes it easier to realize acquisitions and investments throughout economic cycles. ‘By combining both groups into one industrial group, the existing shareholders of Picanol Group and Tessenderlo Group have the opportunity to participate directly in such a new project and the question no longer arises as to which group will realize which new project.’

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In addition to Tessenderlo, Picanol and Rieter, Tack also owns many non-public companies. Under the brand umbrella Love Home Fabrics, he owns eight textile companies, which together generate a turnover of more than one hundred million euros and are controlled by his sons and daughter. In addition, from the start of his entrepreneurial career, he has owned a series of tank cleaning companies, which he bundles under the holding company Begoos. This also includes the 22 percent stake in the crane company Sarens, which he took over from the private equity fund Waterland in September last year† It is not the intention to bring the companies that Tack owns outside the control structure surrounding Tessenderlo and Picanol into the merger group. “We especially wanted to bring all listed companies together under one control vehicle,” said spokesman Frederic Dryhoel.

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Tessenderlo launches bid for Picanol

Key figures of the Picanol-Tessenderlo . merger group

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