Lydall Agrees to be Acquired by Unifrax; Shares Skyrocket 85%

Shares of Lydall (LDL) jumped as much as 85% by the end of trade on Monday after the company agreed to be acquired by Clearlake Capital-backed Unifrax for $62.10 per share, implying an enterprise value of $1.3 billion. The acquisition is expected to close in the second half of 2021.

Lydall designs and produces specialty filtration materials and advanced material solutions. Unifrax is a provider of high-performance specialty materials.

Lydall president and CEO Sara Greenstein said, “We are excited about the combination of Lydall and Unifrax. With this transaction, we are creating a leader in specialty filtration and advanced materials with over 250 years of combined expertise and experience delivering innovative and compelling solutions to customers worldwide.” (See Lydall stock chart on TipRanks)

President and CEO of Unifrax John Dandolph said, “The combination of Unifrax and Lydall creates a global specialty materials platform with new cutting edge technologies in advanced filtration, electric vehicle battery systems, and energy saving applications.”

With 23 manufacturing locations around the globe, Lydall is likely to benefit from the growth in clean air filtration and electric vehicle adoption, along with other suitable markets globally.

On June 10, Sidoti analyst John Franzreb reiterated a Hold rating on the stock with a price target of $41.

During Lydall’s Q1 earnings call, Franzreb asked if the labor cost issues the company had faced were over. To this, Greenstein answered that the high costs due to temporary staffing measures taken during the pandemic-induced shutdown were completely over.

Shares are up 367.2% over the past year.

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