Recall Holdings (ASX:REC) is recommending that shareholders accept the proposed $2.7bn acquisition deal from the US-based firm Iron Mountain (NYSE:IRM). The Australian company was spun out from Brambles (ASX:BXB) in December 2013 and has had a short tenure as a stand-alone company. The deal from the US logistics giant Iron Mountain will see that shareholder receive 0.17 IRM shares for every REC share currently owned, or alternatively a cash payment of $8.50 per share. This deal comes a half-year after Recall rejected a $2.2bn offer from the same company, calling the previous deal undervalued. Chief Executive Doug Pertz said the new deal was substantially better than the last. "We feel that it's a good deal for shareholders that appropriately shares the value that will be created in combining the two businesses," he said.
The $8.50 cash payment per share is 33 per cent above the $6.40 share price that Recall was trading at in December, when the first offer was made. If the deal goes through, a secondary listing for Iron Mountain will appear on the ASX and will be 20 per cent owned by existing REC shareholders. Mr. Pertz said the deal would cut costs and reduce redundancies across both companies. “The combination of Recall and Iron Mountain makes strong commercial sense and offers the potential to create significant value for both sets of shareholders," he said. Shares REC are up 1c, or .13 per cent, at $7.63 per share around 3:27pm on Wednesday. REC has advanced 68.43 per cent in the last 12 months and over 6 per cent so far this year.