Element Materials Technology, a laboratory testing business owned by Bridgepoint, has agreed to acquire rival Exova in a £620.3m deal.
Element offered 240 pence per share for Exova, which was owned by CD&R and floated in 2014 at a market cap of £550m. CD&R remained the majority shareholder following the listing, retaining a 54 per cent stake.
Shareholders will also be offered a final dividend, meaning they will receive a total of 242.35 pence per share in total.
The cash value represents a 26 per cent premium to the average share price over the last 12 months, and a 10.7 per cent premium to the closing price on the 24 March 2017.
It also implies an enterprise value of approximately 12.5x Exova’s adjusted Ebitda.
“This transaction will create a truly global product and materials testing business, increasing Element’s operational reach across key markets in the US, Europe and Asia,” said Element’s chief executive Charles Noall.
Bridgepoint bought Element from 3i at the end of 2015, in a deal which made the vendor a 3.9x return in sterling.