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Layne Christensen Schedules Shareholder Vote on Granite Construction Buyout
Wednesday 16 May 2018

16 May 2018 - Texas, US-based water management, construction and drilling company Layne Christensen Company (NASDAW: LAYN) has scheduled a special meeting for 13 June for shareholders to vote on the company's pending acquisition by California, US-based infrastructure contractor Granite Construction Inc. (NYSE: GVA), the company said.

In February, Granite Construction agreed to acquire all outstanding shares of Layne Christensen in a stock-for-stock transaction valued at USD 565m, including the assumption of net debt.

The transaction is expected to close in 2Q18. Wynnefield Capital, which has an approximate 9.0% voting interest in Layne, has agreed to vote in favor of the transaction.

In connection with the transaction, Granite will issue approximately 5.4 m shares of Granite common stock to Layne common stockholders.

Under the terms of the agreement, Layne shareholders will receive a fixed exchange ratio of 0.270 Granite shares for each share of Layne common stock they own.

This represents USD 17 per Layne share, or a premium of 33%, based on the volume-weighted average prices for Granite and Layne shares over the past 90 trading days. Following the close of the transaction, Layne shareholders will own approximately 12% of Granite shares on a fully diluted basis.

Granite expects to assume outstanding Layne convertible debt with principal value of USD 170m and honor the terms and existing maturity date provisions of the indentures.

The company also expects to fund the cash financing requirements of the transaction of approximately USD 70m through a combination of existing cash on hand and availability under Granite's revolving credit facility.

Layne enhances Granite's presence in the large and growing water infrastructure market.

The combined company, including Granite's existing water business, will have water-related revenues of approximately USD 600m, positioning Granite as a leader across both the transportation and water infrastructure markets.

Together, Granite and Layne will have nearly 7,000 employees and serve a diverse and growing customer base.

Granite is an infrastructure contractor and construction materials producer. Granite specialises in complex infrastructure projects, including transportation, industrial and federal contracting, and is in alternative procurement project delivery.

Layne is a global water management, infrastructure services and drilling company, providing responsible solutions to the world of essential natural resources--water, minerals and energy.

Perella Weinberg Partners LP is serving as financial advisor to Granite, and Jones Day is serving as legal counsel. Greentech Capital Advisors, LLC is serving as financial advisor to Layne, and Latham and Watkins LLP and Stinson Leonard Street LLP are serving as legal counsel.
Details
Date Published: 16/05/2018
Target: Layne Christensen Company
Country: USA
Deal Size: 565m (USD)
Sector: Petroleum/Natural Gas/Coal
Type: Corporate acquisition
Financing: Stock
Status: Agreed
Vendor:
Buyer: Granite Construction
Buyer Advisor: Perella Weinberg Partners , Jones Day
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