Cardtronics on Tuesday has entered into a definitive agreement to get acquired by funds affiliated to Apollo Global Management and Hudson Executive Capital in a deal worth $2.3 billion. The transaction is likely to be completed in the first half of 2021.
Cardronics (CATM) said that shareholders will get $35 in cash for each share held. Shares rose less than 1% to $35.77 on Tuesday. Notably, the purchase price is 12.9% higher than the first proposal of $31 per share made on Dec. 9 by Apollo and Hudson. (See CATM stock analysis on TipRanks)
Cardtronics CEO Ed West said, “This announcement represents an exciting milestone for Cardtronics and is a testament to the strength and value of our company.” He further commented, “Following a comprehensive process and review of alternatives, which included discussions with strategic buyers and financial sponsors, the Board determined that this transaction is in the best interest of the Company and our shareholders.”
On Dec. 10, Wells Fargo analyst Timothy Willi raised the stock’s price target to $40 (11.8% upside potential) from $35 and reiterated a Buy rating. In a note to investors, Willi had said that the $31 per share offer was just a starting point and expected that the bid could go higher if other bidders emerge or the company pushes back the offer.
Overall, the rest of the Street is sidelined on the stock. The Hold analyst consensus is based on 3 Holds, 1 Buy and 1 Sell. The average price target stands at $37.50 and implies upside potential of about 4.8% to current levels. Shares have dropped by 19.9% year-to-date.