22 May 2017
Visit www.capgemini.com/worldreports

Diebold gets $3bn takeover offer

03 March 2008  |  5928 views  |  0 Diebold

Troubled US ATM manufacturer Diebold has received an unsolicited cash takeover bid, worth around $3 billion, from US conglomerate United Technologies Corporation (UTC).

UTC has offered $40.00 per share for Diebold, which represents a 66% premium on the vendor's $24.12 closing price on Friday, although the offer is still some way off from Diebold's 52-week high of $54.50.

UTC - which operates a number of diversified business including jet engine-maker Pratt & Whitney and UK-based Chubb security systems - says it has spent over two years trying to talk to Diebold about a deal but has been continually re-buffed. The conglomerate has now made the most recent correspondence between the firms public.

"UTC's resources and presence in markets globally would be significant assets to Diebold in expanding its business worldwide and increasing its margins and profitability," says UTC chairman and CEO George David in a letter to Diebold chairman John Lauer dated 19th February.

Lauer replied on 21 February saying the Diebold board had discussed the offer and decided it was not in the best interests of the firm or its shareholders.

Furthermore, in his letter Lauer requested that neither David nor any other representative of UTC contact any member of the Diebold Board.

However on Friday David again wrote to Lauer with the offer and said that after failing to engage in discussions with Diebold's board and management, UTC will go public with its proposal.

"We believe it is in your shareholders' interests to know of this proposal," says David's letter.

Diebold has not yet made any public comment on the UTC offer.

Shares in Diebold, which has been investigated by US Securities and Exchange Commission (SEC) over its revenue recognition practices, have fallen by around a half over the past year.

Last month the ATM and voting machine vendor said it was cutting 800 jobs - five per cent of its global workforce - following a disappointing 2007 and amid gloomy forecasts for 2008. The 800 job cuts are on top of an ongoing, $100 million cost-reduction programme.

Diebold president and CEO, Thomas Swidarski, also said the deteriorating condition of the credit markets within the US bank industry would likely result in reduced capital investment in branch construction, which will negatively impact Diebold's financial self-service and security businesses in 2008.

Update - Diebold rejects UTC offer

In a statement Diebold says its board of directors has "unanimously rejected" UTC's unsolicited proposal and recommends that shareholders "take no action at this time with respect to the proposal".

"The board strongly believes that UTC's proposal significantly undervalues the company and fails to reflect Diebold's strengths and significant upside potential," says Lauer in the statement. "UTC's proposal is an opportunistic attempt to buy Diebold at a time when shareholders do not have sufficient data to evaluate the offer and as such, the board believes that it would be irresponsible to engage in discussions with UTC at this time."

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Diebold cuts 800 jobs; warns of trouble ahead

Diebold cuts 800 jobs; warns of trouble ahead

06 February 2008  |  5887 views  |  0 comments
Diebold reports BB&T ATM order

Diebold reports BB&T ATM order

11 December 2007  |  4044 views  |  0 comments
Diebold moves into the red on Emea restructuring charge

Diebold moves into the red on Emea restructuring charge

25 April 2007  |  4775 views  |  0 comments
Diebold in legal battle with union over closure of French ATM facility

Diebold in legal battle with union over closure of French ATM facility

30 January 2007  |  31968 views  |  0 comments
SEC probes Diebold

SEC probes Diebold

08 August 2006  |  6486 views  |  0 comments
Diebold's Q2 profit falls 46%

Diebold's Q2 profit falls 46%

25 July 2006  |  4679 views  |  0 comments
FSPA drops anti-trust lawsuit against Diebold

FSPA drops anti-trust lawsuit against Diebold

03 August 2005  |  5105 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
Download the paper nowvisit dh.comVisit www.capgemini.com/worldreports

Top topics

Most viewed Most shared
European banks lobby Commission to push ahead with screen scraping banEuropean banks lobby Commission to push ah...
8538 views comments | 29 tweets | 35 linkedin
Time for data-driven banking to come of ageTime for data-driven banking to come of ag...
8526 views comments | 28 tweets | 35 linkedin
Google and PayPal partner for mobile shopping by fingerprintGoogle and PayPal partner for mobile shopp...
8129 views comments | 27 tweets | 27 linkedin
Banks must get on AI bandwagon now – new Finextra researchBanks must get on AI bandwagon now – new F...
7797 views comments | 22 tweets | 29 linkedin
UK consumers ready to swap banks for tech giantsUK consumers ready to swap banks for tech...
7641 views comments | 36 tweets | 47 linkedin

Featured job

Six Figure Base + Commission + Stock Options
London

Find your next job