COLUMBUS MCKINNON CORPORATION (NASDAQ:CMCO) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
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ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
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Share Purchase Agreement
Columbus McKinnon Corporation and its Dutch affiliate (CM) entered
into a Stock Purchase Agreement (the Agreement) to acquire from
Konecranes Plc, a Finish public limited liability company, through
its direct or indirect subsidiaries (Seller), all of the issued and
outstanding capital stock of the STAHL CraneSystems business
(STAHL), including STAHL CraneSystems GmbH and nine STAHL
affiliates.
into a Stock Purchase Agreement (the Agreement) to acquire from
Konecranes Plc, a Finish public limited liability company, through
its direct or indirect subsidiaries (Seller), all of the issued and
outstanding capital stock of the STAHL CraneSystems business
(STAHL), including STAHL CraneSystems GmbH and nine STAHL
affiliates.
Under the terms of the Agreement, the total consideration for the
transaction will be 224 million (~$240 million) on a cash-free,
debt-free basis and adjusted for Working Capital, with an earn-out
potential of up to 230 million (~$246 million), if certain earnings
goals are met for calendar year 2016, with interest accruing at 8%
per annum from January 1, 2017 through the closing date.
Additionally, Columbus McKinnon assumes unfunded pension
liabilities that were estimated at 74 million as of July 31, 2016.
The closing of the sale is subject to the satisfaction of (i) the
European Commission approval of Columbus McKinnon as the buyer,
(ii) the successful closing of the pending acquisition of certain
Terex subsidiaries by Konecranes Plc, (iii) the German
Bundeskartellamts merger control approval, and (iv) other customary
conditions. The deal is expected to close prior to April 30, 2017,
but no earlier than January 31, 2017. The effective date of the
Agreement is January 1, 2017.
transaction will be 224 million (~$240 million) on a cash-free,
debt-free basis and adjusted for Working Capital, with an earn-out
potential of up to 230 million (~$246 million), if certain earnings
goals are met for calendar year 2016, with interest accruing at 8%
per annum from January 1, 2017 through the closing date.
Additionally, Columbus McKinnon assumes unfunded pension
liabilities that were estimated at 74 million as of July 31, 2016.
The closing of the sale is subject to the satisfaction of (i) the
European Commission approval of Columbus McKinnon as the buyer,
(ii) the successful closing of the pending acquisition of certain
Terex subsidiaries by Konecranes Plc, (iii) the German
Bundeskartellamts merger control approval, and (iv) other customary
conditions. The deal is expected to close prior to April 30, 2017,
but no earlier than January 31, 2017. The effective date of the
Agreement is January 1, 2017.
The foregoing summary of the Agreement and the transactions
contemplated thereby do not purport to be complete and are subject
to, and qualified in their entirety by, the full text of the
Agreement.
contemplated thereby do not purport to be complete and are subject
to, and qualified in their entirety by, the full text of the
Agreement.
The Agreement has been provided solely to inform CMs shareholders
and investors of its terms. The representations, warranties and
covenants contained in the Agreement were made only for purposes of
such agreement and as of specific dates, were made solely for the
benefit of the parties to the Agreement and may be intended not as
statements of fact, but rather as a way of allocating the risk to
one of the parties if those statements prove to be inaccurate. In
addition, such representations, warranties and covenants may have
been qualified by certain disclosures not reflected in the text of
the Agreement, and may apply standards of materiality in a way that
is different from what may be viewed as material by shareholders
of, or other investors in, CM. Such shareholders and investors are
not third-party beneficiaries under the Agreement and should not
rely on the representations, warranties and covenants or any
descriptions thereof as characterizations of the actual state of
facts or condition of CM, the Seller and STAHL or any of their
respective subsidiaries or affiliates.
and investors of its terms. The representations, warranties and
covenants contained in the Agreement were made only for purposes of
such agreement and as of specific dates, were made solely for the
benefit of the parties to the Agreement and may be intended not as
statements of fact, but rather as a way of allocating the risk to
one of the parties if those statements prove to be inaccurate. In
addition, such representations, warranties and covenants may have
been qualified by certain disclosures not reflected in the text of
the Agreement, and may apply standards of materiality in a way that
is different from what may be viewed as material by shareholders
of, or other investors in, CM. Such shareholders and investors are
not third-party beneficiaries under the Agreement and should not
rely on the representations, warranties and covenants or any
descriptions thereof as characterizations of the actual state of
facts or condition of CM, the Seller and STAHL or any of their
respective subsidiaries or affiliates.
Debt Commitment Letter
In connection with the execution of the Agreement, the CM entered
into a commitment letter (the Debt Commitment Letter) with JPMorgan
Chase Bank, N.A. (JP Morgan Chase Bank) to which JPMorgan Chase
Bank committed to provide $570 million of borrowings consisting of
a senior secured lien credit facility in the aggregate amount of
$470 million (the First Lien Facility) and a senior secured second
lien term loan facility in the aggregate amount of $100 million
(the “Second Lien Term Facility”).
into a commitment letter (the Debt Commitment Letter) with JPMorgan
Chase Bank, N.A. (JP Morgan Chase Bank) to which JPMorgan Chase
Bank committed to provide $570 million of borrowings consisting of
a senior secured lien credit facility in the aggregate amount of
$470 million (the First Lien Facility) and a senior secured second
lien term loan facility in the aggregate amount of $100 million
(the “Second Lien Term Facility”).
The First Lien Facility of $470 million is comprised of (i) a
revolving facility (the Revolving Facility) in an aggregate amount
of $75 million with terms and conditions consistent with CM’s
existing Revolving Credit Facility and (ii) a term loan facility
(the First Lien Term Facility) in an aggregate amount of $395
million. JPMorgan Chase Banks commitments under the Debt Commitment
Letter will be used, among other things, to finance the Offer
Price, pay related fees, expenses and transaction costs, and
replace the Company’s current borrowings under its Term Loan and
Revolving Credit Facility.
revolving facility (the Revolving Facility) in an aggregate amount
of $75 million with terms and conditions consistent with CM’s
existing Revolving Credit Facility and (ii) a term loan facility
(the First Lien Term Facility) in an aggregate amount of $395
million. JPMorgan Chase Banks commitments under the Debt Commitment
Letter will be used, among other things, to finance the Offer
Price, pay related fees, expenses and transaction costs, and
replace the Company’s current borrowings under its Term Loan and
Revolving Credit Facility.
The foregoing description of the Debt Commitment Letter is not
complete and is qualified in its entirety by reference to Debt
Commitment Letter, which is attached to this report as Exhibit 10.1
and incorporated herein by reference.
complete and is qualified in its entirety by reference to Debt
Commitment Letter, which is attached to this report as Exhibit 10.1
and incorporated herein by reference.
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Item 7.01
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REGULATION FD DISCLOSURE.
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On December 7, 2016, CM issued a press release announcing entry
into the Agreement. A copy of the press release and the related
presentation slides are included as Exhibit 99.1 and 99.2 to this
Current Report and are incorporated herein by reference.
into the Agreement. A copy of the press release and the related
presentation slides are included as Exhibit 99.1 and 99.2 to this
Current Report and are incorporated herein by reference.
CM management also hosted a conference call to discuss this
transaction on Wednesday, December 7, 2016 at 9:00 am Eastern Time.
CM invited interested investors to listen to the live webcast and
view related presentation slides, which are available on
transaction on Wednesday, December 7, 2016 at 9:00 am Eastern Time.
CM invited interested investors to listen to the live webcast and
view related presentation slides, which are available on
CMs website: www.cmworks.com. The U.S. and international dial-in
number is 1-201-493-6780. If you are unable to participate on the
live call, a replay will be available through Midnight Eastern,
December 14, 2016 by dialing 1-858-384-5517 and entering the
passcode 13651171 or by logging on to www.cmworks.com.
number is 1-201-493-6780. If you are unable to participate on the
live call, a replay will be available through Midnight Eastern,
December 14, 2016 by dialing 1-858-384-5517 and entering the
passcode 13651171 or by logging on to www.cmworks.com.
The information in this Current Report furnished to Item 7.01 and
9.01 shall not be deemed filed for the purposes of Section 18 of
the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that Section. This information shall
not be incorporated by reference into any registration statement to
the Securities Act of 1933, as amended. The furnishing of the
information in this Current Report in not intended to, and does
not, constitute a representation that such furnishing is required
by Regulation FD or that the information this Current Report
contains is material investor information that is not otherwise
publicly available.
9.01 shall not be deemed filed for the purposes of Section 18 of
the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that Section. This information shall
not be incorporated by reference into any registration statement to
the Securities Act of 1933, as amended. The furnishing of the
information in this Current Report in not intended to, and does
not, constitute a representation that such furnishing is required
by Regulation FD or that the information this Current Report
contains is material investor information that is not otherwise
publicly available.
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Item 9.01
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FINANCIAL STATEMENTS AND EXHIBITS.
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(d) Exhibits.
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EXHIBIT
NUMBER
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DESCRIPTION
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10.1
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Debt Commitment Letter, dated November 30, 2016
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99.1
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Press Release dated December 7, 2016
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99.2
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Teleconference slides dated December 7, 2016
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About COLUMBUS MCKINNON CORPORATION (NASDAQ:CMCO)
Columbus McKinnon Corporation is a global designer, manufacturer and marketer of hoists, actuators, cranes, rigging tools, digital power control systems, and other material handling products serving various commercial and industrial end user markets. The Company’s products include various electric, air-powered, lever, and hand hoists, hoist trolleys, winches, industrial crane systems, such as steel bridge, gantry and jib cranes and aluminum work station cranes; alloy and carbon steel chain; forged attachments, such as hooks, shackles, textile slings, clamps, logging tools and load binders; mechanical and electromechanical actuators and rotary unions; below-the-hook special purpose lifters and tire shredders; power and motion control systems, such as alternate current (AC) and direct current (DC) drive systems, radio remote controls, push button pendant stations, brakes, and collision avoidance and power delivery subsystems. COLUMBUS MCKINNON CORPORATION (NASDAQ:CMCO) Recent Trading Information
COLUMBUS MCKINNON CORPORATION (NASDAQ:CMCO) closed its last trading session down -1.59 at 26.00 with 63,530 shares trading hands.