CHICAGO, April 20 /PRNewswire/ -- Borg-Warner Security Corporation
(NYSE: BOR) announced today that it has signed a definitive agreement for the
sale of its Wells Fargo Alarm business to ADT Security Services, a subsidiary
of Tyco International, Ltd. ADT will purchase the stock of Wells Fargo Alarm
for approximately $425 million in cash. Borg-Warner expects that the net cash
proceeds of approximately $425 million will be used primarily to repay
outstanding debt. The transaction, subject to certain customary closing
conditions and government approvals, is expected to be completed sometime in
the second quarter of 1998.
In connection with the sale of Wells Fargo Alarm, Borg-Warner Security
expects to record a restructuring charge relating to the repayment of
outstanding debt, the consolidation of certain administrative activities,
potential adjustment of its position relative to Pony Express and other
matters. The Company expects that the restructuring charge will largely
offset an expected after-tax gain of approximately $45 million from the sale
of the alarm business.
Joe Adorjan, chairman and chief executive officer commented, "I am
extremely pleased with the proposed transaction. Strategically, the sale of
Wells Fargo Alarm accomplishes a number of objectives. First, the solid
balance sheet that results from this transaction dramatically increases our
ability to invest in our existing business and to grow through acquisitions,
both internationally and in North America.
"Second, we have entered into a strategic relationship with ADT that
aligns the world's leading physical and electronic security service suppliers
to provide Total Security Solutions for our respective customers. This will
enable both companies to capitalize on the global trend toward outsourcing
non-core activities and the growing demand for Total Security Solutions."
Borg-Warner Security Corporation is North America's largest provider of
security services. The company offers a complete range of services, including
electronic and physical security services under the Wells Fargo and Burns
brand names.
FORWARD LOOKING INFORMATION
Risks and uncertainties that may affect projections include the cost and
availability of labor, the consequences of debt leverage to the company's
ability to fund its operations, the ability to manage the risks associated
with the services provided by the company, the ability to acquire other
security businesses at attractive prices and successfully integrate such
acquisitions into existing operations, and the other factors listed in Exhibit
99 to the company's Form 1O-K for the year ended December 31, 1997.
For a copy of this press release or for additional information on the
company, contact our Web site at http://www.Borg-WarnerSecurity.com or
http://www.prnewswire.com.
SOURCE Borg-Warner Security Corporation
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Related links:
http://www.Borg-WarnerSecurity.com
Company News On-Call: http://www.prnewswire.com or
fax, 800-758-5804, ext. 120940
CONTACT:
Analysts, Jeff Cartwright, 312-322-8836, or
Media, Lynne Glovka, 312-322-8511, both of Borg-Warner Security
Corporation
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