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Ams sweetens takeover bid for German lighting group Osram

Austrian sensor specialist ams AG revised its all-cash bid to acquire German lighting company Osram Licht AG to €41 per share from €38.50 apiece, calling it the company's best and final offer.

The increased bid follows an indicative competing offer from Advent International Corp. and Bain Capital LP. Ams said its revised offer reflects a 42% premium to undisturbed Osram share price of €28.92 and that its proposal is superior, given its strategic vision, higher growth, better cash flows and lower cost of capital. Ams' new bid will expire Oct. 1.

Ams argued that the indicative competing offer from the two private equity firms remains uncertain because it is still contingent on confirmatory due diligence over the coming weeks, closing of a new committed financing structure and final investment committee approval, among other things.

Ams noted that it has secured financing for its offer through a €4.4 billion bridge facility and that it plans to raise €1.6 billion of new equity. Pro forma for the equity issuance, ams anticipates the transaction will lead to a pro forma December leverage of about 4.5x net debt/EBITDA, or roughly 3.4x net debt/EBITDA adjusted for run-rate cost and revenue synergies.

Ams also signed a cooperation agreement with Osram's management and supervisory board whereby it committed to continue to operate Osram's existing German production sites for at least three years, designate Munich as a co-headquarters of the merged group and create manufacturing and engineering jobs in Germany, among other things.

HSBC, UBS and BAML are the underwriters for the bridge facility. HSBC and UBS are the underwriters for the planned equity offering.