Private equity firm Warburg Pincus will acquire Rural/Metro Corp., a provider of ambulance and private fire protection services. The firm will pay $17.25 per share for the company, a 37% premium over its closing price on March 25. The deal is expected to close at the end of June 2011.
Rural/Metro Corporation (NASDAQ: RURL) (the “Company”), a leading national provider of ambulance and private fire protection services, today announced it has entered into a definitive agreement for the acquisition of the Company by the private equity firm Warburg Pincus in an all-cash transaction.
Under terms of the agreement, Rural/Metro shareholders will receive $17.25 per share of common stock in cash, representing a 37% premium over the closing price on March 25, 2011 and a 28% premium over the volume weighted average share price over the previous month. The Company’s Board of Directors, acting on the recommendation of a Special Committee consisting of independent directors, unanimously approved the terms of the agreement and recommended that Rural/Metro shareholders approve the transaction. In addition to shareholder approval, the transaction is subject to the satisfaction of customary closing conditions and regulatory approvals. It is currently anticipated the transaction will be completed by the end of June 2011.
Christopher Shackelton, Chairman of the Board of Rural/Metro, said, “The Board believes that this transaction is an exceptional opportunity for Rural/Metro’s shareholders. We have worked diligently to maximize the long-term value in the business, and are pleased that our shareholders are being rewarded for their trust in the Company’s vision, business plan and management.”
Mr. Shackelton emphasized that, “Following careful consideration and the examination of various methods to enhance shareholder value, the Board of Directors believes that now is an advantageous time for the Company to move to the next stage of its development as a private company under the stewardship of Warburg Pincus.”
Michael DiMino, President and Chief Executive Officer, said, “I am excited by the transition of Rural/Metro to new ownership. Partnering with Warburg Pincus provides the resources and flexibility to fuel our organic and strategic growth initiatives, and to leverage our strength as the best-in-class operator in both the ambulance and private fire protection industries. For our employees, customers and patients, we are dedicated to maintaining the highest standards of care, and to enhancing our value as a key partner in every community we serve.”
Sean Carney, a Warburg Pincus Managing Director, said, “We believe an investment in Rural/Metro and this industry is a tremendous opportunity for Warburg Pincus. Rural/Metro is an expert provider of ambulance and private fire protection services with an experienced management team that has delivered excellent results and increased shareholder value. We are excited to work with the management team and the 8,000 dedicated employees under Michael DiMino’s leadership to enhance the Company’s technological capabilities and service for the long-term benefit of its customers.”
RBC Capital Markets and Moelis & Company are acting as financial advisors, and the law firm of Paul, Hastings, Janofsky & Walker is acting as legal advisor to Rural/Metro.
Citigroup Global Markets, Inc., Credit Suisse and Jefferies & Company, Inc. acted as financial advisors, and Cleary Gottlieb Steen & Hamilton is acting as legal advisor to Warburg Pincus.
About Rural/Metro Corporation
Rural/Metro Corporation is a leading national provider of emergency and non-emergency ambulance services and private fire protection services in 20 states and approximately 440 communities throughout the United States. For more information, please visit the Company’s web site at www.ruralmetro.com.
About Warburg Pincus
Warburg Pincus is a leading global private equity firm. The firm has more than $30 billion in assets under management. Its active portfolio of more than 110 companies is highly diversified by stage, sector, and geography. Warburg Pincus is a growth investor and an experienced partner to management teams seeking to build durable companies with sustainable value. Founded in 1966, Warburg Pincus has raised 13 private equity funds which have invested more than $35 billion in over 600 companies in more than 30 countries. The firm has offices in Beijing, Frankfurt, Hong Kong, London, Mumbai, New York, San Francisco, Sao Paulo, and Shanghai.