American ATM manufacturer Diebold has agreed to acquire its German rival Wincor Nixdorf in a deal worth about $1.8bn (EUR1.7bn).
Under the deal, Diebold will offer Wincor Nixdorf shareholders EUR38.98 in cash plus 0.434 Diebold common shares per Wincor Nixdorf share.
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The deal, which is expected to yield nearly $160m in annual costs savings, will be subject to certain closing conditions, including regulatory approvals and a minimum acceptance threshold of c. 67.6% of all Wincor shares.
Upon completion of transaction, the combined entity will be renamed Diebold Nixdorf and have registered offices in North Canton, Ohio, US and will be operated from headquarters in North Canton and Paderborn, Germany.
Led by Diebold president and CEO AndyMattes, the combined company with around 1 million installed ATMs had combined annual revenues of $5.2bn as of 30 September 2015. It will pursue a growing total addressable market of approximately $60bn.
The deal will see Wincor Nixdorf CEO Eckard Heidloff becoming president of the combined firm, while Christopher Chapman, current Diebold chief financial officer (CFO), will serve as CFO of the combined company, and Jurgen Wunram Wincor Nixdorf CFO, will become chief integration officer and will represent the retail business in the executive committee.
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By GlobalDataThe board of the combined company will also comprise three new directors namely Alexander Dibelius, chairman of the supervisory board of Wincor Nixdorf, Dr. Dieter Düsedau, member of the supervisory board of Wincor Nixdorf, and Eckard Heidloff. All the three will join the supervisory board of Wincor Nixdorf upon closing to facilitate the integration.
Diebold intends to raise about $2.8bn to fund the transaction. This permanent financing will include a $0.5bn senior secured revolver and $2.3bn of senior secured term loans and unsecured notes.
Andy Mattes said: "Our new company will be well positioned for growth in high-value services and software — particularly in the areas of managed services, branch automation, mobile and omnichannel solutions — across a broader customer base.
"This combination was made possible through the successes we have had and continue to create in the Diebold 2.0 transformation plan."
Eckard Heidloff said: "The combination of Diebold and Wincor Nixdorf is an exciting opportunity for both companies to shape the future of banking and retail solutions. Together, we can even better leverage the potential of a rapidly changing banking and retail market due to our strong combined R&D expertise.
"Furthermore, we are convinced that our employees will benefit from being part of an even stronger, more global organization that is well positioned for the age of digitalization."
