ANN ARBOR — The compressor manufacturer Tecumseh Products Co. (NASDAQ: TECU) said it has an agreement to be acquired by an affiliate of Mueller Industries Inc. (NYSE: MLI) and Atlas Holdings LLC.
Mueller, based in Memphis, Tenn., is a manufacturer of copper tube and fittings; brass and copper alloy rod, bar and shapes; aluminum and brass forgings; aluminum and copper impact extrusions; plastic fittings and valves; refrigeration valves and fittings; and fabricated tubular products. Atlas Holdings is a private equity firm in Greenwich, Conn.
The companies announced a transaction valued at $123 million, or $5 per share in cash, a 155 percent premium based on Tecumseh’s closing price of $1.96 per share on Aug. 4.
“We look forward to working with Mueller Industries and Atlas Holdings to help us achieve continued growth as we provide our customers with innovative, best-in-class products and outstanding service and support,” stated Harold Karp, Tecumseh president and CEO.
Tecumseh’s board of directors has unanimously approved the merger agreement.
The companies said that Tecumseh will remain a standalone business with its headquarters unchanged at the close of the proposed transaction. In addition, Tecumseh will continue to operate its global technology centers and manufacturing facilities in North America, South America, Europe and Asia. They also said that Tecumseh’s senior management is expected to remain in place post transaction close.
Tecumseh was founded in 1934 as a compressor manufacturer. Through the 1956 purchase of Lauson Manufacturing Co., it became one of the largest small engine manufacturers in the United States. It sold its gasoline engine and power train product lines to Platinum Equity LLC in 2007. The company shut down its small engine business in 2009 and sold its transmission business to Husqvarna. The engines are now manufactured by Liquid Combustion Technology of Travelers Rest, S.C. and Certified Parts Corp. of Janesville, Wis.
Tecumseh’s headquarters moved from Tecumseh to Ann Arbor in 2009.
The company said the transaction is expected to be completed in the third quarter of 2015.