Gardner Denver Shareholders to Receive $76 Per Share In Cash
Transaction Valued at Approximately $3.9 Billion
WAYNE, Pa. & NEW YORK--(BUSINESS WIRE)--
Gardner Denver, Inc. (NYSE: GDI) and Kohlberg Kravis Roberts & Co. L.P.
(together with its affiliates, "KKR") today announced that the companies
have entered into a definitive merger agreement in a transaction valued
at approximately $3.9 billion, including the assumption of debt.
Under the terms of the merger agreement, KKR will acquire all of the
outstanding shares of Gardner Denver common stock for $76 per share in
cash. This price represents a premium of approximately 39 percent to
Gardner Denver's share price on October 24, 2012, the day before the
Company confirmed that it had begun to explore strategic alternatives.
The merger is subject to approval from Gardner Denver's shareholders,
regulatory approvals and other customary closing conditions. The Board
of Directors of Gardner Denver unanimously approved the merger agreement
and recommends that Gardner Denver shareholders vote in favor of the
transaction. The transaction is currently expected to close in the third
quarter of 2013.
"After a thorough review of strategic alternatives to enhance
shareholder value, we are pleased to provide our shareholders with
immediate and substantial cash value representing a significant premium
to our unaffected share price," said Michael M. Larsen, Gardner Denver's
President and Chief Executive Officer. "In addition to the significant
value to our shareholders, Gardner Denver will benefit from KKR's track
record of execution as the Company continues to pursue its strategy
focused on driving organic growth, particularly in underserved markets,
and building new revenue streams in the aftermarket and through the
introduction of innovative customer-centric solutions across its
businesses. We anticipate this transaction will create opportunities to
accelerate the operating initiatives already underway and we are
confident that it will also be beneficial for our employees, customers
and all other stakeholders.
"Our success and this positive development is a testament to our
dedicated employees who will continue to build on the momentum that our
team has worked so hard to create," continued Mr. Larsen. "As we
position Gardner Denver to enter its next phase of growth and success,
we look forward to working closely with KKR to seamlessly close this
transaction."
Pete Stavros, Member of KKR and head of the firm's Industrials
investment team, said, "Gardner Denver is an outstanding business with a
rich heritage of manufacturing excellence, innovation and quality that
spans well over 100 years. The Company has an impressive group of
talented and dedicated employees, and we look forward to working closely
with them to drive future growth and value. The long-term future of
Gardner Denver is bright."
The transaction is being made through KKR's investment funds.
Goldman, Sachs & Co. is serving as financial advisor to Gardner Denver
and Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
advisor. UBS Securities LLC and Simmons & Company International are
serving as financial advisors to KKR and Simpson Thacher & Bartlett LLP
is serving as legal advisor. Fully committed debt financing will be
provided by UBS Securities LLC, Barclays, Citigroup, Deutsche Bank
Securities Inc., RBC Capital Markets, Mizuho Corporate Bank, Ltd., and
KKR Capital Markets, an affiliate of KKR, in the form of senior secured
credit facilities. Deutsche Bank Securities Inc., Citigroup, Barclays,
UBS Securities LLC, RBC Capital Markets, Mizuho Corporate Bank, Ltd.,
and KKR Capital Markets also arranged debt financing in the form of a
senior unsecured bridge facility.
About Gardner Denver
Gardner Denver, Inc., with 2012 revenues of approximately $2.4 billion,
is a leading worldwide manufacturer of highly engineered products,
including compressors, liquid ring pumps and blowers for various
industrial, medical, environmental, transportation and process
applications, pumps used in the petroleum and industrial market segments
and other fluid transfer equipment, such as loading arms and dry break
couplers, serving chemical, petroleum and food industries. Gardner
Denver's news releases are available by visiting the Investors section
on the Company's website (www.GardnerDenver.com).
About KKR
Founded in 1976 and led by Henry
Kravis and George
Roberts, KKR is a leading global investment firm with $75.5 billion
in assets under management as of December 31, 2012. With offices around
the world, KKR manages assets through a variety of investment funds and
accounts covering multiple asset classes. KKR seeks to create value by
bringing operational expertise to its portfolio companies and through
active oversight and monitoring of its investments. KKR complements its
investment expertise and strengthens interactions with fund investors
through its client relationships and capital markets platform. KKR & Co.
L.P. is publicly traded on the New York Stock Exchange (NYSE: KKR), and
"KKR," as used in this release, includes its subsidiaries, their managed
investment funds and accounts, and/or their affiliated investment
vehicles, as appropriate.
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
limitation, the statements made concerning the Company's intent to
consummate a merger with an affiliate of KKR. As a general matter,
forward-looking statements are those focused upon anticipated events or
trends, 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. Among others, the following
uncertainties and other factors could cause actual results to differ
from those set forth in the forward-looking statements: (i) the risk
that the merger may not be consummated in a timely manner, if at all;
(ii) the risk that the definitive merger agreement may be terminated in
circumstances that require the Company to pay KKR a termination fee of
$103.4 million or reimbursement of their expenses of up to $10 million;
(iii) risks related to the diversion of management's attention from the
Company's ongoing business operations; (iv) risks regarding the failure
of the relevant KKR affiliate to obtain the necessary financing to
complete the merger; (v) the effect of the announcement of the merger on
the Company's business relationships (including, without limitation,
customers and suppliers), operating results and business generally; and
(vi) risks related to obtaining the requisite consents to the merger,
including, without limitation, the timing (including possible delays)
and receipt of regulatory approvals from various domestic and foreign
governmental entities (including any conditions, limitations or
restrictions placed on these approvals) and the risk that one or more
governmental entities may deny approval. Further risks that could cause
actual results to differ materially from those matters expressed in or
implied by such forward-looking statements are set forth under "Risk
Factors" in the Company's Form 10-K for the fiscal year ended December
31, 2012, and its subsequent quarterly reports on Form 10-Q. The Company
does not undertake, and hereby disclaims, any duty to update these
forward-looking statements, although its situation and circumstances may
change in the future.
Additional Information and Where to Find It
In connection with the merger, the Company intends to file relevant
materials with the Securities and Exchange Commission (the "SEC"),
including a preliminary proxy statement on Schedule 14A. Promptly after
filing its definitive proxy statement with the SEC, the Company will
mail the definitive proxy statement and a proxy card to each stockholder
entitled to vote at the special meeting relating to the merger.
INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THESE
MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY
OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE MERGER THAT THE COMPANY
WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY AND THE MERGER. The
definitive proxy statement, the preliminary proxy statement and other
relevant materials in connection with the merger (when they become
available), and any other documents filed by the Company with the SEC,
may be obtained free of charge at the SEC's website at www.sec.gov.
In addition, investors and security holders may obtain free copies of
the documents filed with the SEC at the Company's website, www.gardnerdenver.com,
or by contacting Investor Relations by phone at (610) 249-2009, by email
at investor.request@gardnerdenver.com
or by mail at 1500 Liberty Ridge Dr. Suite 3000 Wayne, PA 19087.
The Company and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the Company's
stockholders with respect to the merger. Information about the Company's
directors and executive officers and their ownership of the Company's
common stock is set forth in the proxy statement for the Company's 2012
Annual Meeting of Shareholders, which was filed with the SEC on March
15, 2012. Information regarding the identity of the potential
participants, and their direct or indirect interests in the merger, by
security holdings or otherwise, will be set forth in the proxy statement
and other materials to be filed with SEC in connection with the merger.
Gardner Denver
Vikram U. Kini, 610-249-2009
VP,
Investor Relations
or
Joele Frank, Wilkinson, Brimmer,
Katcher
Matthew Sherman, Jennifer Beugelmans or Joseph Sala
212-355-4449
or
KKR
Kristi
Huller, 212-230-9722
Kristi.Huller@kkr.com
Source: KKR
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