Atkore Inc. (NYSE:ATKR) soared by 28 percent to a new 52-week high on Monday, as investors gobbled up its shares after it agreed to be acquired by Prysmian SpA for $3.8 billion, or at a 30 percent premium over its closing price prior to the announcement.
In a statement, the electrical products maker said that it officially entered into a definitive agreement with Prysmian, under which the latter will acquire its outstanding shares in an all-cash transaction at a price of $95 apiece.
The announcement bolstered Atkore Inc.’s (NYSE:ATKR) shares to their highest price of $93.60 at intra-day trading today—or just over $1 shy of the offer price, signaling that investors are largely pricing in the deal to push through.
“Atkore and Prysmian are highly complementary organizations, and we believe this combination will create a stronger platform with greater scale and a more comprehensive portfolio of solutions to better serve customers,” Atkore Inc. (NYSE:ATKR) Chairman Michael Shrock said.
Photo from Atkore website
Accelerate Electrification, Data Center Rollout
Management believed that the merger of both companies will create a one-stop shop in North America that will simplify and accelerate electrification and data center roll-out for customers.
For Prysmian, the transaction will help expand its product and service offering in North America and broaden its portfolio with complementary electrical infrastructure products, and further enhance its exposure to long-term structural growth trends in electrification and data center investment.
The transaction is set for completion by the end of the year, subject to other regulatory approvals, including Atkore Inc.’s (NYSE:ATKR).
The Board of Directors of both companies have already given the go-signal for the transaction.
Q2 Profits Nearly Wiped Out
The sale followed news about Atkore Inc.’s (NYSE:ATKR) 98.3-percent dive in net income in the second quarter of the year to only $745,000 from $42.96 million in the same period last year, dragged by a $50 million litigation expense associated with recent divestitures and other activities in conjunction with the previously announced strategic review.
Net sales, on the other hand, jumped by 8 percent to $794.8 million from $735 million year-on-year, thanks to increased sales volume of $65.7 million, higher average selling prices, and foreign exchange benefits, which partially offset the $39 million negative impact of divestitures.
$0.33 Dividend
Despite the weak earnings, Atkore Inc. (NYSE:ATKR) is set to distribute $0.33 in dividends to its shareholders on record as of August 18, 2026. Payments will be made on August 28.
Hedge Fund Participation Weakens
Both hedge fund participation and conviction markedly weakened for Atkore Inc. (NYSE:ATKR) in the first quarter of the year, signaling a cautious stance among institutional investors.
Data from Insider Monkey showed that 37 hedge funds held positions in the company as of the first quarter of the year, down from 41 in the quarter previously.
Conviction also dipped by 3 percent to $417.7 million from $430.9 million year-on-year.
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