Ocean Biochem shares up 110% after announcing merger agreement

Ocean Bio-Chem Inc (NASDAQ: OBCI) and OneWater Marine Inc (NASDAQ: ONEW) have entered into a definitive merger agreement whereby the latter corporation is to acquire the former. This announcement increased Ocean Bio-Chem’s stock price by 110%.

Bio-Chem Inc, a leading distributor, and supplier of maintenance, cleaning, and appearance commodities for the Powersports, automotive, recreational vehicles, and marine industry, will be acquired in an all-cash deal for about $13.08 per share, representing a total consideration price of roughly $125 million.

Details of the transaction 

According to the deal, OneWater Marine Inc will also get Ocean Bio-Chem’s affiliate company, Star Brite Europe. Upon completion of the deal, both Star Brite Europe and Ocean Bio-Chem will merge into T-H Marine Supplies, a subsidiary and strategic growth company for OneWater’s parts and accessories businesses.

Being that Ocean Bio-Chem is a vertically integrated supplier, the company distributes, markets and manufactures a wide variety of commodities under the Odor Star, Star Tron, and Star Brite brands. Ocean Bio-Chem offers private label production, packaging, and blending for most of its products.

The company’s corporate headquarters are situated in Fort Lauderdale, with a manufacturing plant that ships products worldwide in Montgomery, Alabama.

OneWater Marine will finance the deal alongside a Trust bank extension of term loan facility. Both parties expect to complete this transaction by the end of the fourth quarter of the 2022 fiscal calendar. Ocean Bio-Chem’s financial advisers in the deal are Houlihan Lokey and its legal counsel is Morgan, Lewis & Bockius.

Management statements

Ocean Bio-Chem President and Chief Executive Officer, Peter Dornau said: