Shares in Premier Farnell, the company behind the ultra-affordable Raspberry Pi, a credit card-sized single-board computer, have surged 50 per cent after the group revealed it has agreed a takeover deal with a subsidiary of Swiss manufacturer Datwyler.
Bidco has offered 165p per share in cash, which values Premier Farnell at around £615m, and represents a premium of around 51 per cent to the company's closing price of 109.3p yesterday.
The deal has an enterprise value of around £792m.
14 June 2016 @ 8:30amPremier Farnell (PFL)
"Both companies share very similar strategic values and are highly complementary in terms of product range... distribution channels and geographic footprint," a statement from Premier Farnell said.
If the deal completes, the combined group will operate a global technical components division with approximately 4,900 employees, over one million products stocked in warehouses and is expected to generate revenue of approximately 1.8bn Swiss francs (£1.3bn). The total revenue of the combined group based on adjusted 2015 figures is expected to reach approximately 2.5bn francs.
“Premier Farnell and Datwyler both have long and successful histories in high-service distribution for electronic components," said Datwyler boss Ulrich Graf.
"By combining forces, we significantly increase our competitiveness and extend our product range, facilitating a one-stop shopping experience for our wide range of customers from a multitude of industries. With our system critical service we have a distinct differentiator and create value for all stakeholders – customers, suppliers, employees and shareholders.”
Meanwhile, Valerie Gooding, chairman of Premier Farnell, said the group's directors "believe that this offer recognises the quality of our business and its future prospects, and provides our shareholders with immediate and significant value in cash for their shares".
"The transaction represents a compelling strategic proposition, underpinned by complementarity in terms of product range, distribution channels and geographic exposure," she added.
"Premier Farnell faces an increasingly competitive market and the ongoing need for further restructuring of the business. We believe that Premier Farnell will be better positioned to address these changes and challenges with the benefit of the increased scale afforded by a combination with Datwyler."
Premier Farnell's Raspberry Pi overtook the Amstrad to become the fastest-selling British computer last year. However, the company has struggled to deal with pressure from rivals, and earlier this year was forced to slash its dividends after issuing a series of profit warnings.