To: Jeff Jordan who wrote (14167 ) 9/8/1998 1:08:00 PM From: Jenna Respond to of 120523
Israel's ECI, Tadiran Telecom To Merge In $369 Million Deal NEW YORK -(Dow Jones)- Israeli telecommunications concerns ECI Telecom Ltd. andTadiran Telecommunications Ltd. Tuesday said they have agreed to merge in a stocktransaction valued at around $369 million. For more than a year there has been speculation that Koor Industries Ltd. (KOR)wanted to merge the activities of Tadiran Telecom and ECI. In February, Koor bought thefirst of its holdings in ECI, and it is now its majority shareholder, with 17% of ECI's equity. Tadirin Telecom's shareholders will receive one share of ECI for each 1.79 shares of Tadiran, which has 25 million shares outstanding. Based on ECI's closing stock priceFriday of $26.375, the merger values Tadirin Telecom at around $14.73 a share. In midmorning trading, Tadirin Telecom (TTELF) shares rose $1.0625 to $16. ECI (ECILF) wasup $1.125 to $27.50. Rumors had been floating around that Tadiran would be valued at $20 a share, or $500million, in the sale to ECI. An ECI acquisition of Tadiran Telecom holdings has been a subject of speculation eversince the Claridge Group became Koor's majority shareholder last October. Claridge IsraelInc. has sharpened the company's focus on its core businesses of electronics,communications and agrochemicals. It plans to put more emphasis on acquisitions and mergers, speed up the sale of noncore businesses, and already has taken steps to streamline Koor's management. Koor has some 30 subsidiaries in electronics, telecommunications, agrochemicals, building and infrastructure materials, energy, food and other industries. The company acquired 17% of ECI earlier this year from Claridge and Clal Industries & Investments Ltd. Tuesday, ECI said it expects to post a first-quarter charge for purchased in-process research and development and merger and integration-related costs. Analysts polled by First Call are expecting ECI to earn 55 cents a share in the quarter. The agreement, expected to close by the end of the first quarter of 1999, is subject to a definitive agreement, expected by the end of October, and approval by the boards and shareholders of both companies. Tadiran Telecom earned $23.9 million, or 95 cents a share, on $444 million in revenue in 1997. Copyright (c) 1998 Dow Jones & Company, Inc. All Rights Reserved.