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Total to acquire battery-maker Saft in US$1.1-billion deal

France-based energy major Total has filed a friendly tender offer on all of the issued and outstanding shares in the capital of advanced battery maker Saft with the French Financial Markets Authority (Autorité des Marchés Financiers, AMF).

The proposed offer will target all of Saft’s issued and outstanding shares at a price of €36.50 per share, ex-dividend of €0.85 per share, valuing Saft’s equity at €950 million (US$1.1 billion). The offer price represents a 38.3% premium above Saft’s closing share price of €26.40 on 6 May 2016; a premium of 41.9% above the volume weighted average share price over the past six months; and a premium of 24.2% above the volume weighted average share price over the past year.

The offer values the company at nine times its 2015 reported EBITDA, which represents a significant control premium compared to recent valuation multiples in the battery industry.

The Supervisory Board of Saft has unanimously approved the friendly takeover by Total and considers the proposed transaction to be in line with the interests of the company, its shareholders and its employees. As part of the reasoned opinion that it must issue in accordance with market regulations, the Supervisory Board has also announced its intention to recommend that its shareholders tender their shares.

The Supervisory Board of Saft is appointing Finexsi as an independent expert. The proposed offer is subject to review by the AMF, which will evaluate its compliance with applicable laws and regulations.

The combination of Saft and Total will enable Saft to become the Group’s spearhead in electricity storage. The acquisition of Saft is part of Total’s ambition to accelerate its development in the fields of renewable energy and electricity, initiated in 2011 with the acquisition of SunPower. Saft’s renowned technological know-how and unique expertise have allowed it to develop innovative and competitive solutions for its clients. It will notably allow us to complement our portfolio with electricity storage solutions, a key component of the future growth of renewable energy. This transaction will also enable Saft, its management and employees to benefit from Total’s technical, industrial, commercial and financial support. In addition, this transaction will enable Saft to successfully accelerate its development.

—Patrick Pouyanné, Chairman and CEO of Total

Comments

HarveyD

Smart move by Total. Others like Shell, BP, Exon, Mobil will soon follow?

Wouldn't be surprised to see them move on to H2 main and sub stations and quick e-charging facilities within 2-3 years or so.

Account Deleted

A major global oil company buying a well known lithium battery maker! Change is coming and some of the oil companies seem to know the writing on the wall that they will all be gone 40 years from now replaced by clean technologies like batteries.

Engineer-Poet

This could well be Cobasys all over again.

HarveyD

The world may go from 100+ lithium batteries manufacturers to two dozens or less in 15 to 20 years from now but that should be enough to supply demands.

Of course, every lithium battery variety will be issued with specific patents and legal battles will take place.

Research versus Royalties and/or legal cost is often the price to pay.

The TESLA-Panasonic joint venture with mega factories may be the way to go. They will be big enough to buy interesting starters?

Lad

E-P:
Good point; it could go either way with a battery company under oil company management.

yoatmon

What is Total's true intention? Are they joining battery production or is it just a means to lock-out competition? Time will tell.

HarveyD

Oilcos are not stupid and are sitting on piles of cash.

To progressively switch to REs, batteries, FCs, eletrolizers and very quick e-charging facilities is a smart move and others will follow TOTAL.

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