Cerberus to Buy DynCorp for $1.5 Billion

[Bozita]

Source: NYTimes

Mergers & Acquisitions
Cerberus to Buy DynCorp for $1.5 Billion
April 12, 2010, 9:54 am

DynCorp International, the private military contractor, said on Monday it has agreed to sell itself to Cerberus Capital Management for $1.5 billion, as the private equity industry continues to return to its core business of deal-making.

Cerberus will pay $17.55 a share for DynCorp, a 49 percent premium to Friday’s closing price of $11.75. DynCorp now has 28 days under a “go-shop” provision within the deal agreement to find a higher and better offer.

While DynCorp has continued to win new contracts from the federal government, it has also been the subject of controversy over the years for its assignments in Iraq.

snip-

Cerberus is no stranger to companies with ties to the military: it owns Freedom Group, one of the biggest assemblages of gun manufacturers. Freedom is in the process of going public.

-snip-

Read more: http://dealbook.blogs.nytimes.com/2010/04/12/cerberus-to-buy-dyncorp-for-1-5-billion/

[jody]

1. Freedom Group owns Remington, Bushmaster, DPMS/Panther Arms, Marlin, H&R, NEF, Dakota Arms, LC Smith

Parker, AAC, Barnes Bullets, EOTAC and INTC.

[Arctic Dave]

4. Correct me if I'm wrong, but doesn't their acquisition time line

coincide with price increases.

Hmmm.

[jody]

5. I had the same thought. n/t

[Blue_Tires]

2. Ceberus may want to put more effort in running Chrysler

[Joanne98]

3. Great! Time to cancel all of DynCorp's contracts!

[Duke Newcombe]

6. This is how SkyNet began, y'know. n/t

[tomm2thumbs]

7. America's expanding national product: 'to return to its core business of deal-making'

[jberryhill]

8. I was hoping for Chupacabra or Bigfoot

Way to go, Cerberus...

[leveymg]

9. Cerberus has destroyed every company it has ever taken over

Vulture Capitalists swoop in when companies are already in decline. Here's how the formula works: takeover using leveraged assets of other holdings, strip takeover of liquid assets, sell-off the remainder, wait for the big bail-out check at the end of the process - on to the next dying sector.