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Monday, May 16, 2011

Daimler, Rolls secure backing with raised Tognum bid, (RR), (TGMG), (NYSE: CMI)

Daimler (DAIGn.DE) and Rolls-Royce (RR.L) have secured the backing of Tognum (TGMG.DE) for their takeover of the specialty engine maker by sweetening their offer to 26 euros a share and lowering the acceptance threshold to 30 percent. Tognum said it welcomed the improved offer, which is up from 24 euros a share, and all members of its supervisory and management board holding shares would tender them. The increased offer values Tognum at 3.4 billion euros ($4.83 billion), the equivalent of 11.3 times recent annual core earnings, a discount to rival Cummins (CMI.N), but a premium to Wartsila (WRT1V.HE). As the bidders have changed the offer price and lowered the acceptance threshold from the original 50 percent plus one share, the acceptance period will be extended by two weeks to June 1.

Cummins Inc. designs, manufactures, distributes and services diesel and natural gas engines, electric power generation systems and engine-related component products, including filtration, exhaust aftertreatment, fuel systems, controls and air handling systems. Shares of CMI traded higher by 0.48% or $0.53/share to $110.82. In the past year, the shares have traded as low as $60.36 and as high as $121.49. On average, 2587090 shares of CMI exchange hands on a given day and today's volume is recorded at 2185807.



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