WR Grace gets US$4b bid from top shareholder 40 North

[MARYLAND] WR Grace , a supplier of catalysts to refineries, has received a US$4 billion takeover offer from top shareholder 40 North after its shares slumped this year.

40 North, the multibillion-dollar investment firm linked to Standard Industries, made an offer of US$60 a share in cash to Maryland-based WR Grace, according to a regulatory filing Monday. The unsolicited offer represents a 36 per cent premium to the chemical company's Friday close.

"We believe this proposal to take the company private represents the most credible path to unlock value for the company and its shareholders with a high level of certainty," 40 North principals David Millstone and David Winter wrote in a letter to WR Grace's board.

40 North, which first invested in the company in 2013, is its biggest shareholder with a stake of almost 15 per cent, according to data compiled by Bloomberg.

The investment firm is timing its approach with a downturn in some of WR Grace's key end markets, including the refining, aerospace and automotive industries. Prices for catalysts used in the production of fuel and other chemicals have stagnated, with some customers switching to cheaper options.

40 North, which has hired Citigroup as an adviser, said it doesn't expect any antitrust or regulatory issues and believes it could complete due diligence within four weeks if given access to the books. As part of any agreement, it would support WR Grace soliciting competing proposals during a "go-shop" period, according to the filing.

BLOOMBERG