QUINCY, Ill., March 9 /PRNewswire-FirstCall/ -- Gardner Denver, Inc.
(NYSE: GDI) announced today that it has signed a definitive agreement to
acquire Thomas Industries Inc. (NYSE: TII), a worldwide leader in the design,
manufacture and marketing of precision engineered pumps and compressors, for a
purchase price of $40.00 per share for all outstanding shares and share
equivalents (approximately $734.0 million) and the assumption of $9.5 million
of long-term capitalized lease obligations. As of December 31, 2004, Thomas
had $267.1 million in cash, cash equivalents and short-term investments. The
net transaction value, including assumed debt and net of cash, is
approximately $476.4 million.
Thomas, headquartered in Louisville, Kentucky, designs, manufactures and
markets Rietschle Thomas brand pumps and compressors for use in global OEM
applications, Welch laboratory equipment and Oberdorfer bronze and high alloy
liquid pumps. Thomas' products are sold into a broad range of attractive end
markets, including medical/laboratory, general industrial, printing,
environmental and packaging. Thomas has wholly-owned operations in
21 countries, on five continents. Its primary manufacturing facilities are
located in Sheboygan, WI, Monroe, LA, Skokie, IL and Syracuse, NY and
Schopfheim, Fahrnau, Puchheim and Memmingen, Germany. In 2004, Thomas
completed the construction of a manufacturing facility in Wuxi, China that is
expected to become operational in mid 2005. Thomas has other locations around
the world to support sales, marketing, service and distribution. The company
serves a diversified, global customer base of OEMs, end users and engineered
system customers with a relationship strategy focused on product innovation,
application engineering and value added designs.
According to their fourth quarter earnings release, for the year ended
December 31, 2004, Thomas' revenues and operating income were $410.1 million
and $208.8 million, respectively. Operating income for this period included
$18.6 million from Thomas' 32% interest in the Genlyte Thomas Group LLC (GTG),
a joint venture formed with The Genlyte Group Incorporated (Genlyte) in 1998,
and a $160.4 million nonrecurring gain on the sale of this joint venture in
July 2004. For the twelve-month period of 2004, operating income from Thomas'
Pumps and Compressors segment, net of corporate expenses, was $29.7 million.
For the year ended December 31, 2004, Thomas' EBITDA (the sum of income before
income taxes, interest expense, depreciation and amortization), excluding
equity income and the gain on the sale of its interest in GTG and $5.3 million
of non-recurring items, was $51.3 million.
Ross Centanni, Chairman, President and Chief Executive Officer of Gardner
Denver, said, "We expect the Thomas product portfolio to complement and
enhance the Gardner Denver offering in terms of channels of distribution,
applications and regions of the world served. This acquisition allows us to
continue pursuing our strategic goals through leveraging our international
opportunities and better serving our customers on a worldwide basis. The
Thomas and Rietschle names are well-established in industrial vacuum
applications. The acquisition also opens new sales channels through Thomas'
strong OEM focus and new growth markets through their leading position in the
medical market segment. In 2004, approximately 23% of Thomas' revenues came
from this higher-growth market segment. Additionally, the acquisition
continues the global diversification of our revenue base. More than 60% of
Thomas' sales are to customers outside the United States."
Gardner Denver has received a debt commitment from Bear, Stearns & Co.
Inc. and JPMorgan Chase Bank, N.A. to fully finance the acquisition of Thomas.
However, Gardner Denver intends to finance the acquisition through an amended
and expanded senior secured bank facility and a public offering of
approximately $200 million of its common stock. In addition, the Company may
choose to access the debt capital markets. The acquisition is not conditioned
upon completion of any of these financings and the size and timing of both the
equity and any debt financings are subject to prevailing market conditions.
The acquisition is expected to close in 2005. Closing is subject to the
approval of Thomas' stockholders and other customary closing conditions,
including the receipt of applicable regulatory approvals. The acquisition of
Thomas is expected to increase Gardner Denver's net income in 2005. However,
as a result of certain non-recurring, non-cash adjustments required under
accounting principles generally accepted in the U.S. (primarily the adjustment
of inventory to fair value) and the anticipated equity financing, the
acquisition is expected to reduce Gardner Denver's diluted earnings per share
slightly in 2005. The Company expects that the acquisition will be accretive
to diluted earnings per share within twelve months of closing, after taking
into account the proposed equity and debt financing outlined above and the
anticipated realization of acquisition-related integration synergies.
Cautionary Statement Regarding Forward-Looking Statements
All of the statements in this release, other than historical facts, are
forward-looking statements made in reliance upon the safe harbor of the
Private Securities Litigation Reform Act of 1995, including, without
limitations, the expected effect on earnings from the acquisition. As a
general matter, forward-looking statements are those focused upon anticipated
events or trends and expectations and beliefs relating to matters that are not
historical in nature. Such forward-looking statements are subject to
uncertainties and factors relating to the Company's operations and business
environment, all of which are difficult to predict and many of which are
beyond the control of the Company. These uncertainties and factors could
cause actual results to differ materially from those matters expressed in or
implied by such forward-looking statements.
The following uncertainties and factors, among others, could affect future
performance and cause actual results to differ materially from those expressed
in or implied by forward-looking statements: (1) the ability to complete the
Thomas Industries acquisition and identify, negotiate and complete other
possible future acquisitions and (2) the list of other uncertainties and
factors set forth in the Company's February 7, 2005 earnings press release.
The Company does not undertake, and hereby disclaims, any duty to update these
forward-looking statements, even though its situation and circumstances may
change in the future.
Gardner Denver will broadcast a conference call to discuss the acquisition
of Thomas on Wednesday, March 9, 2005 at 9:30 a.m. Eastern, through a live
webcast. This free webcast will be available in listen-only mode and can be
accessed, for up to ninety days following the call, through the Investor
Relations page on the Gardner Denver website ( http://www.gardnerdenver.com )
or on CCBN's website ( http://www.fulldisclosure.com ).
Gardner Denver, with 2004 revenues of $740 million ($896 million on a pro
forma basis including the acquisition of Nash Elmo, which was completed in
September 2004), is a leading worldwide manufacturer of reciprocating, rotary
and vane compressors, liquid ring pumps and blowers for various industrial and
transportation applications, pumps used in the petroleum and industrial
markets, and other fluid transfer equipment serving chemical, petroleum, and
food industries. Gardner Denver's news releases are available by visiting the
Investor Relations page on the Company's website
( http://www.gardnerdenver.com ).
SOURCE Gardner Denver, Inc.
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http://www.gardnerdenver.com
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CONTACT:
Helen W. Cornell, Vice President, Finance and
CFO of Gardner Denver, Inc., +1-217-228-8209
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