Why Knoll Stock Rocketed 34% at the Open, but Herman Miller Fell 12.5%
Shares of office furniture maker Knoll (NYSE: KNL) surged upward by 34% as trading got underway on Monday. At the same time, competitor Herman Miller (NASDAQ: MLHR) saw its stock drop 12.5%. The news driving both moves was exactly the same, and investors' responses here were pretty much what you'd expect.
Over the weekend, Herman Miller agreed to acquire Knoll in a $1.8 billion cash-and-stock deal. After the transaction is completed, Herman Miller shareholders will own 78% of the combined entity with former Knoll shareholders owning the remaining 22%. Knoll shareholders will receive $11 in cash plus 0.32 shares of Herman Miller for each Knoll share they own, which amounts to a purchase price of $25.06 per share based on the price of Herman Miller shares prior to the deal's announcement. That's a hefty 45% premium to where Knoll ended trading Friday.
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Source Fool.com
