Armor Holdings, Inc. Announces Agreement to Acquire Stewart & Stevenson Services, Inc.
February 27 2006 - 6:30AM
PR Newswire (US)
- Transformational Acquisition Positions Armor Holdings as Prime
Vehicle Contractor - JACKSONVILLE, Fla. and HOUSTON, Feb. 27
/PRNewswire-FirstCall/ -- Armor Holdings, Inc. (NYSE:AH), a leading
manufacturer and distributor of security products and vehicle armor
systems serving military, law enforcement, homeland security and
commercial markets, announced today that it has signed a definitive
agreement to acquire Stewart & Stevenson Services, Inc. (NYSE:
SVC), a leading manufacturer of military tactical wheeled vehicles
including the Family of Medium Tactical Vehicles (FMTV), the U.S.
Army's primary transport platform. Armor Holdings has agreed to
acquire all of the outstanding stock of SVC for $35 per share in a
cash merger transaction. The total value of the transaction is
expected to be approximately $755 million after deducting SVC's net
cash balance of $312 million as of January 31, 2006. The
transaction is subject to SVC shareholder approval, the expiration
or termination of the Hart-Scott-Rodino waiting period and other
customary conditions. The transaction is expected to close
mid-year. Armor Holdings will finance the transaction through
available cash and with proceeds from new senior credit facilities.
Robert R. Schiller, President of Armor Holdings, said, "This is
truly a transformational event for our company. Stewart &
Stevenson is one of the finest manufacturers of military vehicles
in the world. Our position as the leading supplier of vehicular
armor and safety systems for the up-armored HMMWV, numerous heavy
tactical vehicles, and work for Stewart & Stevenson on the
FMTV, has enabled us to grow our sales and earnings at excellent
rates for the past several years. We believe this opportunity to
become a prime contractor within the military's tactical wheeled
vehicle fleet is extremely compelling. We expect to benefit from
Stewart & Stevenson's world-class fabrication and assembly
operations, strong research and development effort, and highly
capable management team." Max L. Lukens, President and Chief
Executive Officer of Stewart & Stevenson commented, "Our Board
of Directors unanimously concluded that this transaction with Armor
Holdings provides significant value for our shareholders and is in
the best interests of our customers and employees. Our Tactical
Vehicle Systems business led by Denny Dellinger and his team has
developed a standard of quality, reliability and vehicle readiness
for the FMTV that we believe is unmatched in the industry. Armor
Holdings, through its Aerospace & Defense Group, has a
diversified portfolio of great products that it offers to the U.S.
Department of Defense and other customers in various parts of the
world. I believe the successful track record and complementary
strengths of these two organizations offer a platform for future
growth and expanded opportunities for the combined businesses." Mr.
Schiller added, "We believe that the integration of Stewart &
Stevenson will further diversify our overall defense business,
create improved multi-year visibility for revenues, make
appropriate use of our strong financial position, and provide a
wide variety of incremental growth opportunities. We expect the
FMTV program to deliver strong growth going into the second-half of
this year and to continue in 2007 and beyond. Based on this
expectation and potential synergies from the combination, we expect
the acquisition to be accretive to earnings in 2007. We are very
excited to begin the process of integration and creation of a
company that is stronger than either of its predecessors was
individually." Robert Mecredy, President of Armor Holdings
Aerospace & Defense Group, said, "We are very proud of the work
we have done and the close relationships we have built with the
team at Stewart & Stevenson over the past several years. We are
extremely excited about now working full time with this incredibly
talented and capable organization, specifically to identify the
many benefits that might arise from our combination. Stewart &
Stevenson's leadership as a premier vehicle manufacturer brings to
Armor Holdings a multi- year FMTV contract through 2008, and
potentially well into the future. We believe that it positions us
extremely well for a wide range of high-priority procurement
contracts in the coming years. In our opinion, recent Defense
budget actions to significantly increase funding for the FMTV
program underscore the significance of this critical equipment to
U.S. military operations abroad and for the mission of our Guard
and Reserve components. We are proud of what Armor Holdings has
done for our Service men and women and excited to increase our
contribution through the addition of Stewart & Stevenson to the
Armor Holdings Aerospace & Defense Group." Armor Holdings was
advised on the transaction by Pruzan & Co. LLC. Wachovia
Securities provided financing and a fairness opinion to Armor
Holdings' Board of Directors. The law firm of Kane Kessler, P.C.
acted as legal counsel for Armor Holdings. Stewart &
Stevenson's financial advisor was Merrill Lynch & Co., with
Robinson Partners acting as a consultant to the Company. The law
firms of Fulbright & Jaworski LLP and Wachtell, Lipton, Rosen
& Katz acted as legal counsel for Stewart & Stevenson.
CONFERENCE CALL SCHEDULED FOR FEBRUARY 27th AT 11:00AM (EASTERN)
The Company will hold a teleconference at 11:00am (Eastern) on
February 27, 2006, to discuss these developments and answer
questions. There are two ways to participate in the conference call
- via teleconference or webcast. Access the webcast by visiting the
Armor Holdings, Inc. website (http://www.armorholdings.com/). You
may listen by selecting Investor Relations and clicking on the
microphone. Via telephone, the dial-in number is 1-800-230-1093 for
domestic callers, or 1-612-332-0345 for international callers.
There is no passcode required for this call. There will be a
question/answer session at the end of the conference call, at which
point only securities analysts will be able to ask questions.
However, all callers will be able to listen to the questions and
answers during this period. An archived copy of the call will be
available via replay at 1-800-475- 6701 -- access code 820971 for
domestic callers, or 1-320-365-3844 -- access code 820971 for
international callers. The teleconference replay will be available
beginning at 2:30pm on Monday, February 27th, and ending at 11:59pm
on Monday, March 6th. About Armor Holdings, Inc. Armor Holdings,
Inc. (NYSE:AH) is a diversified manufacturer of branded products
for the military, law enforcement, and personnel safety markets.
Additional information can be found at
http://www.armorholdings.com/. About Stewart & Stevenson
Services, Inc. Stewart & Stevenson Services, Inc. (NYSE:SVC),
founded in 1902, is primarily engaged in the design, manufacture
and service of medium and light tactical vehicles for the U.S. Army
and others worldwide. Stewart & Stevenson Services, Inc. is not
affiliated with Stewart & Stevenson LLC. For more information
on Stewart & Stevenson Services, Inc., visit
http://www.ssss.com/. Forward Looking Statements Certain matters
discussed in this press release constitute forward-looking
statements that involve risks and uncertainties that could cause
actual results to differ materially from those projected. These
statements may be identified through the use of words such as
"anticipates," "believes," "plans," "potentially," "expects,"
"intends," "future," and similar expressions. These risks and
uncertainties are described in Armor Holdings, Inc.'s filings with
the Securities and Exchange Commission ("SEC"), including Armor
Holdings, Inc.'s Registration Statement on Form S-3, its 2004 Form
10-K and amendments thereto and most recently filed Forms 8-K and
10-Q and Stewart & Stevenson Services, Inc.'s filings with the
SEC, including Stewart & Stevenson Services, Inc.'s Annual
Report on Form 10-K for the year ended January 31, 2005, which are
available at the SEC's web site at http://www.sec.gov/. Additional
Information and Where to Find It The proposed transaction will be
submitted to Stewart & Stevenson's shareholders for their
consideration, and Stewart & Stevenson will file a proxy
statement to be used to solicit shareholder approval of the
proposed transaction, as well as other relevant documents
concerning the proposed transaction with the SEC. Stewart &
Stevenson shareholders are urged to read the proxy statement
regarding the proposed transaction when it becomes available and
any other relevant documents filed with the SEC, as well as any
amendments or supplements to those documents, because they will
contain important information. You will be able to obtain a free
copy of the proxy statement, as well as other filings containing
information about Stewart & Stevenson and Armor Holdings with
the SEC at the SEC's website at http://www.sec.gov/. Copies of the
proxy statement and the SEC filings that will be incorporated by
reference in the proxy statement can also be obtained, when
available, without charge, by directing a request to Stewart &
Stevenson Services, Inc., Investor Relations, P.O. Box 1637,
Houston, Texas 77251 or at Stewart & Stevenson Services, Inc.'s
Investor Relations page on its corporate website at
http://www.ssss.com/. First Call Analyst: FCMN Contact:
bpatterson@armorholdings.com DATASOURCE: Armor Holdings, Inc.
CONTACT: Robert R. Schiller, President, Armor Holdings, Inc.,
+1-904-741-5400; Media, Michael Fox, President, Corporate
Communications, +1-203-682-8218, , or Investor, James R.
Palczynski, Principal, +1-203-682-8229, , both of Integrated
Corporate Relations, Inc., for Armor Holdings, Inc.; L. Scott Biar,
CFO & Treasurer, Stewart & Stevenson Services, Inc.,
+1-713-868-7700 Web site: http://www.armorholdings.com/
http://www.ssss.com/
Copyright
Stewart (NYSE:SVC)
Historical Stock Chart
From Aug 2024 to Sep 2024
Stewart (NYSE:SVC)
Historical Stock Chart
From Sep 2023 to Sep 2024