Gardner Denver Enters into Definitive Agreement to Be Acquired By KKR (Founded by cousins Henry Kravis & George Roberts)
Gardner Denver Enters intoDefinitive Agreement to Be Acquired By KKR KKR Press Release: 3-8-13
Gardner Denver Shareholders to Receive $76 Per Share In CashTransaction Valued at Approximately $3.9 BillionWAYNE, Pa. & NEW YORK--(BUSINESS WIRE)-- Gardner Denver, Inc. (NYSE: GDI) andKohlberg Kravis Roberts & Co. L.P. (together with its affiliates, "KKR") today announced thatthe companies have entered into a definitive merger agreement in a transaction valued atapproximately $3.9 billion, including the assumption of debt.Under the terms of the merger agreement, KKR will acquire all of the outstanding shares ofGardner Denver common stock for $76 per share in cash. This price represents a premiumof approximately 39 percent to Gardner Denvers share price on October 24, 2012, the daybefore the Company confirmed that it had begun to explore strategic alternatives. Themerger is subject to approval from Gardner Denvers shareholders, regulatory approvals andother customary closing conditions. The Board of Directors of Gardner Denver unanimouslyapproved the merger agreement and recommends that Gardner Denver shareholders votein favor of the transaction. The transaction is currently expected to close in the third quarterof 2013."After a thorough review of strategic alternatives to enhance shareholder value, we arepleased to provide our shareholders with immediate and substantial cash value representinga significant premium to our unaffected share price," said Michael M. Larsen, GardnerDenvers President and Chief Executive Officer. "In addition to the significant value to ourshareholders, Gardner Denver will benefit from KKRs track record of execution as theCompany continues to pursue its strategy focused on driving organic growth, particularly inunderserved markets, and building new revenue streams in the aftermarket and through theintroduction of innovative customer-centric solutions across its businesses. We anticipatethis transaction will create opportunities to accelerate the operating initiatives alreadyunderway and we are confident that it will also be beneficial for our employees, customersand all other stakeholders.
"Our success and this positive development is a testament to our dedicatedemployees who will continue to build on the momentum that our team has workedso hard to create," continued Mr. Larsen. "As we position Gardner Denver to enterits next phase of growth and success, we look forward to working closely withKKR to seamlessly close this transaction."Pete Stavros, Member of KKR and head of the firms Industrials investmentteam, said, "Gardner Denver is an outstanding business with a rich heritage ofmanufacturing excellence, innovation and quality that spans well over 100 years.The Company has an impressive group of talented and dedicated employees, andwe look forward to working closely with them to drive future growth and value. Thelong-term future of Gardner Denver is bright."The transaction is being made through KKRs investment funds.Goldman, Sachs & Co. is serving as financial advisor to Gardner Denver andSkadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor. UBSSecurities LLC and Simmons & Company International are serving as financialadvisors to KKR and Simpson Thacher & Bartlett LLP is serving as legal advisor.Fully committed debt financing will be provided by UBS SecuritiesLLC, Barclays, Citigroup, Deutsche Bank Securities Inc., RBC CapitalMarkets, Mizuho Corporate Bank, Ltd., and KKR Capital Markets, an affiliate ofKKR, in the form of senior secured credit facilities. Deutsche Bank SecuritiesInc., Citigroup, Barclays, UBS Securities LLC, RBC Capital Markets, MizuhoCorporate Bank, Ltd., and KKR Capital Markets also arranged debt financing inthe form of a senior unsecured bridge facility.
About Gardner DenverGardner Denver, Inc., with 2012 revenues of approximately $2.4 billion, is a leadingworldwide manufacturer of highly engineered products, including compressors, liquidring pumps and blowers for various industrial, medical, environmental, transportationand process applications, pumps used in the petroleum and industrial marketsegments and other fluid transfer equipment, such as loading arms and dry breakcouplers, serving chemical, petroleum and food industries. Gardner Denvers newsreleases are available by visiting the Investors section on the Companys website(www.GardnerDenver.com).About KKRFounded in 1976 and led by Henry Kravis and George Roberts, KKR is a leadingglobal investment firm with $75.5 billion in assets under management as of December31, 2012. With offices around the world, KKR manages assets through a variety ofinvestment funds and accounts covering multiple asset classes. KKR seeks to createvalue by bringing operational expertise to its portfolio companies and through activeoversight and monitoring of its investments. KKR complements its investmentexpertise and strengthens interactions with fund investors through its clientrelationships and capital markets platform. KKR & Co. L.P. is publicly traded on theNew York Stock Exchange (NYSE: KKR), and "KKR," as used in this release, includesits subsidiaries, their managed investment funds and accounts, and/or their affiliatedinvestment vehicles, as appropriate.
Forward-Looking StatementsAll of the statements in this release, other than historical facts, are forward-looking statementsmade in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995,including, without limitation, the statements made concerning the Companys intent toconsummate a merger with an affiliate of KKR. As a general matter, forward-looking statementsare those focused upon anticipated events or trends, expectations, and beliefs relating to mattersthat are not historical in nature. Such forward-looking statements are subject to uncertainties andfactors relating to the Companys operations and business environment, all of which are difficult topredict and many of which are beyond the control of the Company. Among others, the followinguncertainties and other factors could cause actual results to differ from those set forth in theforward-looking statements: (i) the risk that the merger may not be consummated in a timelymanner, if at all; (ii) the risk that the definitive merger agreement may be terminated incircumstances that require the Company to pay KKR a termination fee of $103.4 million orreimbursement of their expenses of up to $10 million; (iii) risks related to the diversion ofmanagements attention from the Companys ongoing business operations; (iv) risks regarding thefailure 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 Companys 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, thetiming (including possible delays) and receipt of regulatory approvals from various domestic andforeign governmental entities (including any conditions, limitations or restrictions placed on theseapprovals) and the risk that one or more governmental entities may deny approval. Further risksthat could cause actual results to differ materially from those matters expressed in or implied bysuch forward-looking statements are set forth under "Risk Factors" in the Companys Form 10-Kfor 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 ItIn connection with the merger, the Company intends to file relevant materials with theSecurities and Exchange Commission (the "SEC"), including a preliminary proxystatement on Schedule 14A. Promptly after filing its definitive proxy statement with theSEC, the Company will mail the definitive proxy statement and a proxy card to eachstockholder entitled to vote at the special meeting relating to the merger. INVESTORSAND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THESEMATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) ANDANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE MERGERTHAT THE COMPANY WILL FILE WITH THE SEC WHEN THEY BECOMEAVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUTTHE COMPANY AND THE MERGER. The definitive proxy statement, the preliminaryproxy statement and other relevant materials in connection with the merger (when theybecome available), and any other documents filed by the Company with the SEC, maybe obtained free of charge at the SECs website at www.sec.gov. In addition, investorsand security holders may obtain free copies of the documents filed with the SEC at theCompanys website, www.gardnerdenver.com, or by contacting Investor Relations byphone at (610) 249-2009, by email at email@example.com or by mailat 1500 Liberty Ridge Dr. Suite 3000 Wayne, PA 19087.
The Company and its directors and executive officers may be deemed to beparticipants in the solicitation of proxies from the Companys stockholders withrespect to the merger. Information about the Companys directors and executiveofficers and their ownership of the Companys common stock is set forth in theproxy statement for the Companys 2012 Annual Meeting of Shareholders, whichwas filed with the SEC on March 15, 2012. Information regarding the identity ofthe potential participants, and their direct or indirect interests in the merger, bysecurity holdings or otherwise, will be set forth in the proxy statement and othermaterials to be filed with SEC in connection with the merger.Gardner DenverVikram U. Kini, 610-249-2009VP, Investor RelationsorJoele Frank, Wilkinson, Brimmer, KatcherMatthew Sherman, Jennifer Beugelmans or Joseph Sala212-355-4449orKKRKristi Huller, 212-230-9722Kristi.Huller@kkr.comSource: KKRNews Provided by Acquire Media