MINNEAPOLIS--(BUSINESS WIRE)--Oct. 8, 2014--
Graco Inc.(NYSE:GGG), a leading manufacturer of fluid handling
equipment, announced today that it has signed a definitive agreement to
sell the Liquid Finishing business assets that were purchased as part of
Graco’s acquisition of the Finishing Brands business from Illinois Tool
Works (ITW) on April 2, 2012. The $590 million cash transaction with
Carlisle Companies Incorporated (NYSE:CSL) is anticipated to close no
later than the first quarter of 2015 and is subject to regulatory
approval and other customary closing conditions. The divestiture is
expected to be in compliance with the final Decision and Order that the
United States Federal Trade Commission (FTC) approved on Monday, October
6, 2014, which requires the Company to complete a sale of the Liquid
Finishing business assets within 180 days of the Decision and Order.
The Liquid Finishing business assets included in the sale to Carlisle
are those involved in the development, manufacture and sale of Binks®
spray finishing equipment, DeVilbiss® spray guns and
accessories, Ransburg® electrostatic equipment and
accessories, and BGK curing technology, all of which Graco is required
to divest under the Decision and Order. The 2012 acquisition of
Finishing Brands from ITW also included Gema®, a global
leader in powder coating technology, which passed review by the FTC and
is now part of Graco. No other Graco businesses or assets are included
in the transaction with Carlisle.
“The Gema business is a strong performer and an outstanding strategic
addition to our portfolio,” said Patrick J. McHale, Graco’s President
and CEO. “We are happy to have Gema as part of Graco and are looking
forward to continuing to build upon its strengths.”
Graco will continue to hold the Liquid Finishing business separate from
its other businesses until a sale process is complete. The day-to-day
operations are managed independently by experienced Liquid Finishing
business managers, under the supervision of a trustee appointed by the
FTC and reporting directly to the FTC.
Graco expects to provide further information during the Company’s third
quarter 2014 earnings conference call with investors, which is scheduled
for 10 a.m. central time on October 23, 2014.
Goldman, Sachs & Co. is serving as financial advisor and Lindquist &
Vennum LLP and Covington & Burling LLP are serving as legal counsel to
Graco.
ABOUT GRACO
Graco Inc. supplies technology and expertise for the management of
fluids and coatings in both industrial and commercial applications. It
designs, manufactures and markets systems and equipment to move,
measure, control, dispense, and spray fluid and powder materials. A
recognized leader in its specialties, Minneapolis-based Graco serves
customers around the world in the manufacturing, processing,
construction, and maintenance industries. For additional information
about Graco Inc., please visit us at www.graco.com
or on Twitter @GracoInc.
Cautionary Statement Regarding Forward-Looking Statements
A forward-looking statement is any statement made in this earnings
release and other reports that the Company files periodically with the
Securities and Exchange Commission, as well as in press releases,
analyst briefings, conference calls and the Company’s Overview report to
shareholders, which reflects the Company’s current thinking on the
divestiture of the Liquid Finishing equipment operations. All forecasts
and projections are forward-looking statements. The Company undertakes
no obligation to update these statements in light of new information or
future events.
The Company desires to take advantage of the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995 by making
cautionary statements concerning any forward-looking statements made by
or on behalf of the Company. The Company cannot give any assurance that
the results forecasted in any forward-looking statement will actually be
achieved. Future results could differ materially from those expressed,
due to the impact of changes in various factors. Risk factors related to
the Company’s proposed divestiture of the Liquid Finishing equipment
operations include but are not limited to: whether and when the Company
will be able to realize the expected financial results and effect of the
transaction; how customers, competitors, suppliers and employees react
to the transaction; economic changes in global markets; and whether the
Company will be able to complete a divestiture in a time frame that is
satisfactory to the Federal Trade Commission. Please refer to Item 1A of
the Company’s Annual Report on Form 10-K for fiscal year 2013 (and most
recent Form 10-Q) for a more comprehensive discussion of other risk
factors that relate generally to the our business and financial
condition. These reports are available on our website at www.graco.com/ir
and the Securities and Exchange Commission’s website at www.sec.gov.
Source: Graco Inc.
Graco Inc.
James A. Graner, 612-623-6635
or
Media:
Bryce
Hallowell, 612-623-6679
bhallowell@graco.com