PALO ALTO, Calif.-Watkins-Johnson Co., which specializes in components and subassemblies for communications equipment, entered into a merger agreement with FP-WJ Acquisition Corp.
FP-WJ is a new company formed by certain investment funds managed by Fox Paine & Co. L.L.C.
Under terms of the agreement, the outstanding shares of Watkins-Johnson would be converted into the right to receive $41.125 per share in cash, said the company. This represents a premium of 30 percent over Watkins-Johnson’s closing price of $31.63 on Oct. 25.
After the recapitalization, Watkins-Johnson’s primary operations will consist of its Wireless Products Group, which is focused on wireless communications, high-speed fiber and broadband cable applications. Its president, Malcolm Caraballo, will become president and chief executive officer of the company. The transaction should be completed in early 2000.
