the largest maker of cleaning chemicals for hotels and restaurants, agreed to acquire Nalco Holding Co. (NLC) for $5.4 billion in cash and stock to add water-treatment services. Ecolab is offering $38.80 a share or 0.7005 of a share for each Nalco share, St. Paul, Minnesota-based Ecolab said today in a statement. Ecolab will use about $1.6 billion in cash and issue about 68.9 million shares to pay for the deal. The bid is 34 percent above Nalco’s closing share price yesterday on the New York Stock Exchange.
Buying Naperville, Illinois-based Nalco will diversify Ecolab’s customer base, which is dominated by the hospitality industry and hospitals. Nalco’s Corexit dispersant was used to help clean up the oil spill from BP Plc’s Macondo well in the Gulf of Mexico last year. “The acquisition would shift Ecolab’s center of gravity towards industrial end markets and away from the restaurant and lodging exposure that investors discuss most often,” Laurence Alexander, a New York-based analyst at Jefferies & Co. who rates both companies “hold,” said today in a report. Nalco rose $8.73, or 30 percent, to $37.60 as of 8:31 a.m. before the start of regular trading in New York. The shares dropped 9.6 percent this year before today.
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