Dal-Tile shares soar 24 percent on news of Mohawk buyout
CALHOUN, Ga. -- Shares of tile maker Dal-Tile International Inc. (NYSE:DTL) soared 22 percent Nov. 20 on news the company agreed to a $1.4 billion buyout by carpet maker Mohawk Industries Inc (NYSE:MHK).
Based on the closing price of Mohawk (www.mohawkind.com) stock on Nov. 19, Dal-Tile (www.daltile.com) shareholders would receive equivalent value of $23.10 per share in cash and Mohawk stock. Under the terms of the merger agreement, Dal-Tile stockholders will receive approximately 50 percent in cash and 50 percent in stock, comprised of $11 in cash and .2414 shares of Mohawk common stock for each share of Dal-Tile common stock.
In Tuesday, Nov. 20 trading on the New York Stock Exchange, shares of Dal-Tile jumped $3.87 to close at $21.47, while shares of Mohawk fell $4.10, or 8 percent, to close at $47.28.
As part of the deal, which is expected to be completed by the first quarter of 2002 pending shareholder and regulatory approval, Mohawk will assume $261.7 million in Dal-Tile debt.
Calhoun-based Mohawk is a leading producer of woven and tufted broadloom carpet and rugs, with brands including Mohawk, Aladdin, Bigelow, Custom Weave, Durkan and Galaxy. It has 24,500 employees.
Dal-Tile is the largest manufacturer, distributor and marketer of ceramic tile in the United States, and one of the largest in the world. Headquartered in Dallas, it has 7,500 workers in North America and sells products under the brand name Daltile and American Olean.