DALLAS, Dec. 23 /PRNewswire/ -- Global Industrial Technologies, Inc.
(NYSE: GIX) today announced that its Board of Directors voted unanimously to
reject WHX Corporation's (NYSE: WHX) unsolicited tender offer to acquire
Global for $10.50 per share, saying that the WHX offer is "an attempt to buy
Global at the wrong price and at the wrong time -- just as we are seeing
significant improvements from operations that will make your Company
profitable in 1999." In a letter to Global stockholders, Global's Chairman
and Chief Executive Officer Rawles Fulgham expressed the Board's unanimous
recommendation that stockholders not tender any of their Global shares into
the WHX offer, and stated that the "WHX move is opportunistic; it has made its
offer at a time when the Board believes Global's share price is temporarily
low as a result of the poor world-wide market conditions that have been
affecting our businesses, and just as the integration of A. P. Green into our
Harbison-Walker operations has made your Company one of the largest and most
cost-effective refractories companies in the world."
In reaching its determination and recommendation to unanimously reject
WHX's offer, the Board considered a variety of factors, including the opinion
of each of Global's financial advisors, Wasserstein Perella & Co., Inc. and
J.P. Morgan & Co., Inc., that WHX's offer is inadequate from a financial point
of view, to Global's stockholders. A more detailed description of those
reasons are set forth in the Solicitation/Recommendation Statement on Schedule
14D-9, which Global urges stockholders read carefully and completely.
The full text of Global's letter to its stockholders is attached to this
press release.
Global is a major manufacturer of technologically advanced industrial
products that support high-growth markets around the world. Products include
forged flanges; undercarriage parts for track-mounted vehicles; modular cells
for refining nonferrous metals; premium refractories for lining heat-
containing industrial vessels such as steel furnaces; raw materials used to
make refractory products, processing and recycling equipment.
This document and the attachments hereto may contain certain statements
that are not strictly historical and are considered "forward-looking"
statements under the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Although the Company believes the expectations
reflected in such forward-looking statements are based on reasonable
assumptions it can give no assurance that its expectations will be realized.
Forward-looking statements involve known and unknown risks which may cause the
Company's actual results and corporate developments to differ materially from
those expected. Factors that could cause results and developments to differ
materially from the Company's expectations include, without limitation,
changes in manufacturing and shipment schedules, delays in completing plant
construction and acquisitions, currency exchange rates, new product and
technology developments, competition within each business segment, cyclicality
of the markets for the products of a major segment, litigation, significant
cost variances, the effects of acquisitions and divestitures, and other risks
described from time to time in the Company's reports with the Securities and
Exchange Commission including quarterly reports on Form 10-Q, annual reports
on Form 10-K and reports on Form 8-K.
Rawles Fulgham, Chairman and Chief Executive Officer of Global Industrial
Technologies, Inc., sent the following letter, dated Dec. 23, 1998, to Global
Industrial Technologies, Inc. Stockholders:
December 23, 1998
Dear Fellow Global Industrial Technologies Stockholder:
On December 17, 1998, WHX Corporation began a hostile tender offer to buy
your shares of stock in Global Industrial Technologies, Inc.
It is your Board's unanimous opinion that WHX's offer, which values Global
at $10.50 per share, is too low, and that it is not in your best interests to
tender your shares pursuant to WHX's offer. The WHX move is opportunistic; it
has made its offer at a time when the Board believes Global's share price is
temporarily low as a result of the poor world-wide market conditions that have
been affecting our businesses, and just as the integration of A. P. Green into
our Harbison-Walker operations has made your Company one of the largest and
most cost-effective refractories companies in the world.
Your Board believes that WHX's bid is an attempt to buy Global at the
wrong price and at the wrong time -- just as we are seeing significant
improvements from operations that will make your Company profitable in 1999.
We have provided value to the stockholders in the past -- only seven months
ago Global's stock had traded as high as $18.625, which represented a 13.2%
compounded annual return to stockholders based upon the price at which the
Company's shares began trading in 1992 -- and we are confident we can do so in
the future. To sell Global at this time and at WHX's offered price would
benefit WHX and its stockholders at the expense of your best interests.
ACCORDINGLY, YOUR BOARD STRONGLY RECOMMENDS THAT YOU DO NOT TENDER ANY OF YOUR
SHARES INTO WHX'S OFFER.
In reaching its determination and recommendation to reject WHX's offer,
your Board closely analyzed the offer with the Company's management and
independent outside advisors and considered a variety of factors, including
the opinion of each of Global's financial advisors, Wasserstein Perella & Co.,
Inc. and J.P. Morgan & Co., Inc., that WHX's offer is inadequate from a
financial point of view to Global's stockholders. A more detailed description
of those reasons are set forth in the Solicitation/Recommendation Statement on
Schedule 14D-9 which we enclose for you. We urge you to read the Schedule
14D-9 carefully and completely.
Your Board is committed to building stockholder value through the
realization of the strategic plan your Board has set for the Company. To
accomplish this objective we have:
-- Disposed of non-core businesses;
-- Acquired five refractories businesses, including A. P. Green, giving
Global a substantially increased and improved market position in North
America and elsewhere;
-- Initiated and, in less than six months, substantially completed a
significant restructuring and integration of our refractories
operations, producing $30 million in annual synergies and cost savings.
We anticipate that an additional $6 million of synergies will be
attained by the end of the second quarter of 1999;
-- Ensured that the Board's strategic plan would be implemented as quickly
as possible and with continuity of leadership by putting in place a
management team with an expert and intimate knowledge of Global's
operations; and
-- Continued to take steps to improve near-term operating efficiency and
profitability and proceeded to evaluate further possible asset
dispositions as part of our long-term strategic plans to enhance
stockholder value.
The results of these efforts are just beginning to become apparent in our
operational performance. As a result, we fully expect to return to
profitability in the first half of 1999. Our anticipated profitability over
the course of 1999 will be driven by a meaningful improvement in our operating
margins over the course of the year as we gain the full synergistic benefits
of the strategic repositioning we undertook in 1998.
Many of you may have questions about how a hostile tender offer works.
You should know that you are not hurt by taking your time to consider the
offer. WHX's offer cannot expire before January 15, 1999, and given all the
conditions in WHX's offer, it's likely the deadline will be pushed back even
later. Among other things, the Offer is conditioned on the Board taking
several actions to facilitate the Offer. As described in the enclosed
Schedule 14D-9, the Board has no intention of taking any such steps.
Accordingly, there is no near-term prospect of WHX purchasing shares pursuant
to the Offer.
Global Industrial Technologies has an exciting future which we are just
beginning to realize. This is not the time to sell our Company. WHX is
clearly acting in its own best interests and not in yours.
Thank you for your investment in and support of Global.
Sincerely,
/signature/
Rawles Fulgham
Chairman and Chief Executive Officer
SOURCE Global Industrial Technologies, Inc.
 back to top
Company News On-Call:
http://www.prnewswire.com/comp/422169.html or fax,
800-758-5804, ext. 422169
CONTACT:
George Pasley of Global Industrial
Technologies, Inc., 214-953-4510
|
