Otis seeks to buy remaining stake in Zardoya Otis, valued at $3.9B

Sep. 23, 2021 7:00 AM ETOtis Worldwide Corporation (OTIS)ZRDZFBy: Carl Surran, SA News Editor1 Comment

Male forefinger (index finger) pressing on the first floor button or floor number one in elevator (lift). Mechanical engineering concept
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  • Otis Worldwide (NYSE:OTIS) says it is offering to buy the 49.99% stake it does not already own of Madrid-based Zardoya Otis (OTC:ZRDZF) for €7/share (~$8.20/share), implying an equity value for Zardoya at €3.3B ($3.87B).
  • Zardoya Otis is an elevator original equipment and service business with operations in Spain, Portugal and Morocco; for the 12 months ending May 31, 2021, it generated €801M in revenues and €223M of EBITDA.
  • Otis expects the deal will be mid-single digit percentage accretive to adjusted EPS starting in 2023, adding $0.03-$0.05/share to 2022 earnings.
  • Otis also expects the acquisition will add as much as $80M in cash available for deployment, depending on shares tendered.
  • Otis' strong Q2 likely means 15%-16% EPS growth in 2021, Librarian Capital writes in a bullish analysis published earlier this summer on Seeking Alpha.

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