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Eaton To Acquire Controlling Interest In Ulusoy Elektrik

Power management company Eaton (ETN) said that it agreed to acquire an 82.275 percent controlling interest in Ulusoy Elektrik Imalat Taahhut ve Ticaret A.S., a manufacturer of switchgear based in Ankara, Turkey, with a primary focus on medium voltage solutions for industrial and utility customers.

The purchase price for the shares is approximately $214 million on a cash and debt free basis. This constitutes the entire shareholding of both privileged and ordinary shares of sellers Sait Ulusoy, Kubilay Hakki Ulusoy, Enis Ulusoy and Akgul Ulusoy, and accounts for 90.153 percent of the outstanding voting rights.

On a Turkish Financial Reporting Standards basis, Ulusoy Elektrik had sales for the trailing 12-month period ending September 30, 2018, of 555 million lira ($126 million based on the average exchange rate for the period).

Established in 1985, the company employs approximately 780 people and has manufacturing facilities in Turkey and Indonesia. Products include medium-voltage switchgear, medium-voltage distribution transformers, substation kiosks, and medium-voltage cable connection systems.

The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the first half of 2019. As part of the agreement, certain unrelated businesses with expected revenue in 2018 of approximately $3 million are not included in this transaction. The final purchase price will be adjusted up or down for the level of net cash delivered at closing.

As required by the Turkish capital markets legislation, Eaton plans to file an application to execute a mandatory tender offer for the remaining shares shortly after the transaction closes.

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