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  • Fushi Copperweld CEO and Abax Global Capital offer $434 million to take company private 0 comments
    Nov 3, 2010 9:57 AM | about stocks: FSIN, CU, COPX

    Copper-clad bimetallic conductor products manufacturer Fushi Copperweld (NASDAQ:FSIN) looks set to go private after the company’s CEO and Chairman and Abax Global Capital announced an offer to acquire the company for US$11.50 per share in cash.  Shares in the company closed yesterday at US$9.10 per share.  The offer values Fushi Copperweld at approximately US$434 million.

    Mr. Li Fu, CEO and Chairman, Abax Global Capital and their affiliates already control 29.2% of the company’s stock, and plan to create a new acquisition vehicle that will fund the acquisition of Fushi Copperweld through a combination of debt and equity capital.

    The Nasdaq listed, China focused manufacturer has formed a special committee to consider the offer.
    Yesterday the company posted a 40% rise in its third quarter profits, helped by strong copper prices and a rise in sales volumes from its US facility.

    For the third quarter, net income was $12.9 million, or $0.34 per diluted share, compared with profits of $9.2 million, or $0.31 per diluted share, in the prior year quarter. These results include expenses of $176,000, as well as net interest income of $154,274.

    Adjusted for one-time items, net income was 13 million in the period, or $0.34 per diluted share, up from $7.6 million, or $0.26 per diluted share, in the third quarter of 2009.

    Revenues increased 39.5% to $66.5 million, reflecting organic growth on account of copper prices, as well as a 32% increase in sales volumes from the company's US facility, which offset a slight decline in sales volumes within China.

    By quarter-end, the company's cash position stood at $117.9 million.  Long-term debt totaled $5.9 million, compared to $32.7 million at December 31, 2009.

    The company expects adjusted fully diluted earnings per share to be between $0.29 and $0.31 for the fourth quarter, and between $1.25 and $1.29 for the full-year.

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    Disclosure: no position
    Stocks: FSIN, CU, COPX
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