Finnish Outotec to buy Larox for EUR93m

Finnish construction and engineering company Outotec Oyj (HEL: OTE1V) said today it will acquire local industrial machinery maker Larox Oyj (HEL: LARBS) in a deal, valuing it at EUR93m

Larox's largest shareholders, including members of the Vartiainen family, Capillary Oy, Ilmarinen Mutual Pension Insurance Company, Mikko Laakkonen and Laakkosen Arvopaperi Oy, will sell their series A and B shares to Outotec. The purchase price will be paid with new Outotec shares.

The shares to be sold correspond to 94.40% of all the votes, to 99.99% of all series A shares and to 61.89% of the series B shares in Larox. The transaction is conditional on clearance from the competition authorities, expected in December, at the latest.

The consideration to be offered equals 0.45 Outotec shares for each Larox series A share and 0.40 Outotec shares for each Larox series B share.

After completing the transaction, Outotec will make a mandatory public tender offer as required by the Finnish Securities Market Act for the remaining shares in Larox. The company will pay EUR10.76 per each series A share and EUR9.56 per each series B share in cash.

Outotec expects the takeover to have a positive effect on its business. The estimated synergy benefits are at least EUR7m annually. The deal is not anticipated to have a significant effect on Outotec's EPS in 2010 excluding the possible one-time costs relating to it.

Combining the businesses of Outotec and Larox will further strengthen Outotec's position as a globally leading provider of technology solutions and services to the mining and metals industry.

Aventum Partners acts as Outotec's financial adviser and Roschier, Attorneys Ltd as legal adviser.