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PARIS - French electrical equipment maker Legrand (EURONEXT:LR), currently maintaining a robust market capitalization of $38.87 billion and rated "GOOD" by InvestingPro’s Financial Health Score, has signed a share purchase agreement to acquire a 60.09% controlling stake in access control systems specialist Cogelec (EURONEXT GROWTH:ALLEC), the companies announced Thursday.
The deal, signed on July 31, will see Legrand France purchasing all shares of Cogelec Développement, which indirectly holds 5,347,065 Cogelec shares, representing 60.09% of the company’s capital and 78.39% of voting rights. The acquisition is based on a price of €29 per Cogelec share (ex-dividend 2024). The transaction comes as Legrand demonstrates strong financial performance, with impressive gross profit margins of 51.51% and a healthy current ratio of 1.94.
Following completion of the controlling stake acquisition, which remains subject to approval from the French competition authority, Legrand plans to launch a mandatory simplified tender offer for the remaining Cogelec shares at the same price of €29 per share.
If threshold requirements are met after the tender offer, Legrand intends to implement a squeeze-out procedure to acquire any remaining Cogelec shares not tendered during the offer period.
Cogelec’s social and economic committee unanimously approved the transaction on July 16.
The acquisition of the majority stake and subsequent tender offer filing with the French Financial Markets Authority are expected to take place during the fourth quarter of 2025.
Cogelec, a French specialist in access control systems for buildings, created the first global wireless interphone solution in 2007 and currently operates in six European countries with over 2.6 million subscribed dwellings under its Intratone brand.
Legrand, which reported sales of €8.6 billion in 2024, specializes in electrical and digital building infrastructures and is listed on Euronext Paris as a component of the CAC 40 index. The company has shown remarkable market performance with a 55.56% year-to-date return, though InvestingPro analysis indicates the stock is currently trading above its Fair Value. Investors can access 12 additional exclusive ProTips and comprehensive financial metrics through an InvestingPro subscription.
This information is based on a press release statement from both companies.
In other recent news, Legrand reported second-quarter results that surpassed analyst expectations, following a pre-release indicating strong performance. The company’s sales for the quarter were 5% above consensus, and operating profit exceeded expectations by 8%. Legrand achieved an operating margin of 21.7%, which was 90 basis points higher than anticipated. Additionally, Deutsche Bank’s analysts raised their price target for Legrand to €115, up from €112, while maintaining a Buy rating on the stock. This adjustment follows Legrand’s earlier performance, where growth and margins also exceeded expectations. The analysts noted that the stock trades at 15 times enterprise value to earnings before interest, taxes, amortization, and 20 times price to earnings, based on 2025 projections. They highlighted this as a 5% discount to historical multiples, which they find attractive. The valuation is considered favorable, especially with a potential recovery in the European Union building market by 2026.
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