Schneider Electric expected to make EUR1.2 billion tilt for Shelly

2 hours ago

(AWP Alliance News) - Schneider Electric SE has entered an agreement to acquire a Bulgarian company called Shelly Group SE, the latter reported on Thursday.

The Paris-based electrical equipment company intends to offer EUR70 in cash per share, or EUR1.2 billion in total, for Shelly, a Sofia-based provider of IoT and smart building services, Shelly said.

The offer price is about 22% higher than the reference price of Shelly shares on Wednesday.

Shelly shares rose 4.5% to EUR67.30 each on Thursday morning in Frankfurt, for a market capitalisation of about EUR1.23 billion. The stock closed at EUR64.40 on Wednesday.

Schneider Electric traded 0.1% higher at EUR293.70 per share on Thursday in Paris, for a market cap of EUR169.94 billion.

The French company is yet to officially register an offer, but Shelly said it has entered an investment agreement with a wholly-owned subsidiary of Schneider Electric called SE 2026 A SAS.

Shelly's board will publish a reasoned opinion on the offer once an offer document has been published. Schneider Electric is expected to register the offer within three business days, and clearance from the Bulgarian Financial Supervision Commission is expected by the beginning of December.

"The investment agreement arranges for Schneider Electric's intention to maintain Shelly Group's headquarters in Bulgaria as well as the existing geographical footprint of its operations and to preserve the company's existing organizational structure and workforce, including its research and development, engineering, sales, operations and management functions, for at least three years following completion of the transaction," Shelly said on Thursday.

In order to proceed, the transaction will need to meet an acceptance threshold of at least 95%. Provided it does, it is expected to close in the first quarter of 2027.

Shelly's board sees the potential offer being in the company's interest, and the founding shareholders, who hold a combined 57% of Shelly's shares, have also signalled support.

Co-Chief Executive Dimitar Dimitrov, with a 29% stake, has indicated that he will support the offer, and will reinvest a portion of the proceeds alongside Schneider Electric. He is expected to remain Co-CEO with Wolfgang Kirsch.

Co-founder Svetlin Todorov, who owns 28% of Shelly directly and via his company Salisto Holdings, has agreed to sell his shares in two tranches. The first will comprise 5% of Shelly's capital and the second about 23%.

Shelly first listed on the Bulgarian Stock Exchange in 2016.

Todorov commented: "Over the past five years, we have developed Shelly from a fast-growing smart home product business into an international technology and platform company. Our secondary listing in Frankfurt in 2021 marked an important step in opening Shelly Group to international investors.

"Since then, we have broadened our portfolio, expanded across Europe, built a growing professional ecosystem and, this year, became the first Bulgarian company to join the SDAX. This progress is the achievement of our people and the foundation for our next phase of growth. With Schneider Electric, we see the opportunity to combine Shelly's entrepreneurial culture, open technology platform and customer proximity with global reach and additional resources, while remaining firmly anchored in Bulgaria."

By Holly Munks, Alliance News reporter

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