- All-cash proposal represents a 47% premium over the market close yesterday, and 37% and 51% premiums over the three- and six-month volume weighted average share prices, respectively
- Provides a superior alternative to CIRCOR’s prospects as a standalone company
- Provides certainty of value for CIRCOR shareholders
STAMFORD, Conn.--(BUSINESS WIRE)--Crane Co. (NYSE: CR), a diversified manufacturer of highly engineered
industrial products, today announced that it has submitted a proposal to
the Board of Directors of CIRCOR International, Inc. (NYSE: CIR) or
“CIRCOR,” to acquire CIRCOR for $45 per share in cash. The proposal
represents a 47% premium over yesterday’s closing price and a 37% and
51% premium over a three- and six-month volume weighted average share
price, respectively. This reflects an enterprise value of approximately
$1.7 billion at a multiple of approximately 13.5x the last 12-month
adjusted EBITDA.
Crane Co. proposed the all-cash transaction to CIRCOR’s President and
CEO Scott Buckhout on April 30, 2019, the terms of which were confirmed
by a letter to the CIRCOR Board of Directors. On May 13, the
CIRCOR Board summarily rejected Crane Co.’s proposal with no offer of
discussions or due diligence.
“While we had hoped to complete a transaction privately, the Board’s
rejection of our proposal without comment or discussion led to our
decision to make our proposal known to CIRCOR shareholders so they can
express their views directly to the CIRCOR Board,” said Max Mitchell,
Crane Co. President and Chief Executive Officer. “Our proposal provides
CIRCOR shareholders with attractive value and certainty compared to the
continued uncertainty surrounding CIRCOR’s plans to improve operating
performance. Based on CIRCOR’s history of underperformance and inability
to meet its own financial targets, we believe CIRCOR’s standalone plan
is unlikely to generate value comparable to what we are proposing.”
Mr. Mitchell continued, “We believe that this business, which has great
brands and products, has been meaningfully undermanaged for years. This
has resulted in a persistent decline in CIRCOR’s share price, making it
the worst performer of the peers in the S&P Midcap Capital Goods Index
since the end of 2013. Based upon the strength of our disciplined
operating approach, Crane Co. is well positioned to integrate CIRCOR’s
businesses into our focused portfolio, realize operational synergies,
and deliver long-term value to Crane shareholders. Combining CIRCOR’s
Fluid Handling, Aerospace and Defense assets with Crane’s portfolio of
leading brands would create a stronger competitor with additional scale
and growth potential.”
Crane Co. is highly confident that the proposed transaction could occur
expeditiously:
-
Transaction will not be subject to a financing contingency.
-
Significant resources available to complete confirmatory due diligence.
-
Crane and CIRCOR are complementary businesses with no expected
regulatory delays.
Advisors
Crane Co. has retained Wells Fargo Securities as its financial advisor
and Skadden, Arps, Slate, Meagher & Flom LLP as its legal advisor.
Investor Conference Call
Crane Co. will host a conference call with the financial community at
8:30 a.m. EDT today. To participate on the conference call, please dial
(877) 407-6184. The live webcast of the investor call, as well as
related presentation materials, will be available through the Investor
Relations section of the company’s website (www.craneco.com/investors).
Crane Co. is a diversified manufacturer of highly engineered industrial
products. Founded in 1855, Crane Co. provides products and solutions to
customers in the chemicals, oil & gas, power, automated payment
solutions, banknote design and production and aerospace & defense
markets, along with a wide range of general industrial and consumer
related end markets. The Company has four business segments: Fluid
Handling, Payment & Merchandising Technologies, Aerospace & Electronics
and Engineered Materials. Crane Co. has approximately 12,000 employees
in the Americas, Europe, the Middle East, Asia and Australia. Crane Co.
is traded on the New York Stock Exchange (NYSE:CR). For more
information, visit www.craneco.com.
This press release may contain forward-looking statements as defined
by the Private Securities Litigation Reform Act of 1995. These
statements are based on management’s current beliefs, expectations,
plans, assumptions and objectives regarding the future financial
performance of Crane Co. (the “Company”) and CIRCOR International, Inc.
(“CIRCOR”) and are subject to significant risks and uncertainties. Such
risks and uncertainties include, but are not limited to, risks related
to the expected timing and likelihood of completion of a potential
transaction between the Company and CIRCOR, including the risk that the
potential transaction may not occur, and the risk that any announcements
relating to the potential transaction could have adverse effects on the
market price of the Company’s or CIRCOR’s common stock. Any discussions
contained in this presentation, except to the extent that they contain
historical facts, are forward-looking and accordingly involve estimates,
assumptions, judgments and uncertainties. There are a number of factors
that could cause actual results or outcomes to differ materially from
those addressed in these forward-looking statements. Such factors are
detailed in the Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2018, CIRCOR’s Annual Report on Form 10-K for the
fiscal year ended December 31, 2018 and subsequent reports filed with
the Securities and Exchange Commission (the “SEC”), and will be found in
the definitive proxy statement that will be filed with the SEC by CIRCOR
if a negotiated transaction is agreed to. Such reports are available on
the SEC’s website (
www.sec.gov
).
The Company does not undertake to update any forward-looking statements.
Additional Information and Where to Find It
This communication shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to buy
any securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any
such jurisdiction. This communication does not constitute a solicitation
of a proxy from any stockholder. This communication relates only to a
proposal that the Company has made for a business combination with
CIRCOR. In furtherance of the acquisition proposal, and subject to
future developments, the Company and CIRCOR may file additional relevant
materials with the SEC, including that CIRCOR will file a preliminary
proxy statement on Schedule 14A if a negotiated transaction is agreed
to. Following the filing of the definitive proxy statement with the SEC
(if and when available), CIRCOR will mail the definitive proxy statement
and a proxy card to each stockholder entitled to vote at the special
meeting relating to the proposed transaction. INVESTORS ARE URGED TO
READ THE PROXY STATEMENT IF AND WHEN IT BECOMES AVAILABLE BECAUSE IT
WILL CONTAIN IMPORTANT INFORMATION. Investors may obtain the proxy
statement, as well as other filings containing information about the
Company and CIRCOR, free of charge, from the SEC’s Web site (
www.sec.gov
).
Investors may also obtain the Company’s SEC filings in connection with
the transaction, free of charge, from the Company’s Web site (
www.craneco.com
).
Investors:
Jason D. Feldman
Director, Investor Relations
203-363-7329
superiorvalue@craneco.com
www.craneco.com
Scott Winter / Larry Miller / Gabrielle Wolf
Innisfree M&A Incorporated
212-750-5833
Media:
Tom Davies / Molly Morse
Kekst CNC
212-521-4873 / 212-521-4826
Tom.davies@kekstcnc.com /
Molly.morse@kekstcnc.com