Automotive supplier Starcraft Corp. has agreed to merge with automotive engineering firm Wheel to Wheel Inc., which owns the 50% of Tecstar LLC and Tecstar Canada that Starcraft does not already own, Reuters said.
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The companies jointly formed Tecstar, which provides and installs appearance enhancement items on vehicles provided by and returned to an original equipment manufacturer, in 1998, the report said.
“This move enables us to become a single-focus company with improved financial flexibility …,” Starcraft Chairman Kelly Rose said in a statement cited by Reuters.
According to Reuters, under the agreement, Starcraft will issue 3.55 million shares of its common stock. Based on the trailing 30-day average closing price of Starcraft shares, the transaction is valued at about $122 million. After the transaction, the current owners of Wheel to Wheel will own around 40% of Starcraft’s outstanding shares.
Starcraft also said it expects fiscal fourth quarter net income of $2.6 million, or 49 cents per share, on revenue of $43 million, Reuters added.
