CompuGroup's acquisition of Agfa-Gevaert could stumble over retirement payments - report
Agfa-Gevaert, the Belgian imaging systems group, has attracted interest from German CompuGroup, both parties have confirmed, however, a takeover could be hindered by the target's heavy pension payment burden, De Tijd reported.
Takeover talks are in a preliminary phase, both companies said, according to the report. CompuGroup has not yet received a response to its overtures from Agfa-Gevaert, the Dutch language item added.
The biggest potential stumbling block for a deal could be its total pension commitments of EUR 1.1bn to retirees in the US, UK and mainly Germany, the report noted. Total pension payment spending this year will be about EUR 50m, equal to half the company's ebitda, the item noted.
This results in a total price tag of about EUR 2bn for Agfa-Gevaert, at a price per share of EUR 4.50 to EUR 5, the item noted. This would lead to EUR 770m to EUR 860m for the outstanding shares, plus EUR 1.1bn for the retirement payments.