Barnes Group gains on report Apollo Global in talks to acquire the company

Investing.com -- Barnes Group shares surged more than 10% premarket Friday following a report from Reuters that private equity firm Apollo Global Management (NYSE:APO ) is in advanced discussions to acquire the aerospace components manufacturer.

Barnes Group (NYSE:B ), based in Bristol, Connecticut, is reportedly negotiating to grant exclusivity to Apollo, which is expected to beat out other buyout firms competing for the company, according to Reuters.

Reuters, citing sources, said the deal is likely to value Barnes at over $45 per share, with the company’s stock closing around $40 on Thursday.

The Reuters report states that if successful, a deal could be finalized in the coming weeks, though they cautioned that negotiations are ongoing and could still fall apart, allowing another bidder to emerge.

Barnes, which was founded in 1857, manufactures components for industries including aerospace, healthcare, and electronics.

Its aerospace unit produces parts for commercial and military turbine engines, while its industrials unit develops molding and automation solutions across various sectors.

Barnes employs approximately 5,700 workers across 43 manufacturing locations, according to its website.

The potential acquisition comes after Barnes posted a net loss of $46.8 million in the second quarter of 2024, with revenue of $382.2 million, which missed analysts' expectations. The company's stock has climbed about 25% since the beginning of the year.

The talks with Apollo follow pressure from activist investor Irenic Capital, which took a stake in Barnes in 2022 and pushed for changes to the company’s board and a strategic review.

In March, Barnes reached a cooperation agreement with Irenic, appointing co-founder Adam Katz to its board, noted Reuters.

Source: Investing.com