Middleby Is Buying Welbilt

We got our second Buy List deal recently. Last week, Thermo Fisher said it’s buying PPD.

Now Middleby (MIDD) is buying Welbilt (WBT) for $2.9 billion. This is from the press release:

• Combination will create a premier food equipment company with a leading commercial foodservice portfolio

• Combined business is well positioned to deliver enhanced value for customers through complementary, best-in-class products, unmatched service and forward-thinking technology solutions

• Accelerates key investments in new product development, aftermarket capabilities, connectivity and digital solutions

• Expands international operations, particularly in higher-growth regions across the globe

• Clear path to driving $120 million in operational improvement with $100 million run-rate cost synergies and additional $20 million in Welbilt stand-alone Business Transformation Program annual improvement

• Immediately accretive to adjusted EPS with greater than 10% annual accretion by year two

• Equity consideration mix maintains the Middleby balance sheet flexibility and reserves capacity for future strategic investments in the business, M&A or stock buybacks

This is an all-stock deal. Welbilt shareholders will get 0.124 shares of Middleby for each Welbilt share they own. That’s a 28% premium.

Middleby is actually rallying on the news, so Welbilt is rallying even more. Normally, the shares of the buyer take a hit, especially when it’s a cash deal.

Posted by on April 21st, 2021 at 3:27 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.