Prysmian agrees $30-a-share all-cash deal for General Cable

MILAN (Reuters) - Italian cable maker Prysmian (PRY.MI) has agreed to buy General Cable (BGC.N) for $30 a share in an all-cash deal that values its Kentucky-based rival at about $3 billion (2.22 billion pounds), including debt and other liabilities.

The purchase price represents a premium of 38 percent to General Cable's closing price on Friday of $21.80 and more than 80 percent higher than its price last July, when it started a strategic review to identify a possible merger partner to boost growth and maximize shareholder value.

The deal, which is expected to close by the third quarter of next year, would create a group with combined sales of more than 11 billion euros ($13 billion) and adjusted core earnings (EBITDA) of about 930 million euros, the companies said in a joint statement.

"Through the combination of two of the premier companies in the cable industry we will be enhancing our position in the sector by increasing our presence in North America and expanding our footprint in Europe and South America," Prysmian Chief Executive Valerio Battista said in a statement.

General Cable, which specialises in aluminium, copper and fibre-optic wire and cable products, has also attracted interest from rivals Nexans (NEXS.PA) and NKT (NKT.CO), sources told Reuters in October.

The Prysmian deal, which won unanimous approval from both companies' boards, is subject to acceptance by General Cable shareholders and other regulatory approvals.

Prysmian said it expects the combined group to generate run-rate pretax cost benefits of about 150 million euros within five years, mainly from procurement, overhead costs and manufacturing.

One-off integration costs are estimated at about 220 million euros.

The deal will be financed through a mixture of new debt, cash and existing credit lines. Prysmian said it had asked its chief financial officer to evaluate the possibility of carrying out a rights issue or other financing options for up to 500 million euros over the next 12 months.

Goldman Sachs, Mediobanca and Wachtell, Lipton, Rosen & Katz were advising Prysmian, while General Cable was advised by J.P. Morgan Securities and Sullivan & Cromwell.

(Reporting by Agnieszka Flak; Editing by David Goodman)