KKR Purchases Gardner Denver amidst Valuation Issues

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Gardner Denver Inc had agreed to be sold to KKR and Co LP for the price of US$3.74 billion. Industry experts though still have lingering doubts as to the valuation of the company as it was undeevalued because of the sale.

Shares for Gardner Denver closed at US$74.74 at the NYSE, well below the bid price of US$76 by KKR. This is clearly an indication of investor skepticism over the deal as many analysts place the actual price at US$78.50. According to Thomson Reuters StarMine data, the intrinsic valuation is at US$85.47.

SPX Corp has sought to purchase the industrial machine manufacturer at US$85 per share after it had put itself up for sale. SPX had abandoned the plan to purchase last December after its shareholders questioned the reasons for the acquisition.

Garden Denver is a maker of compressors, vacuums and pump products specifically for industrial use and the company is based out of Wayne, PA.

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