Exhibit 99.1
BFGOODRICH
FOR IMMEDIATE RELEASE
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BF GOODRICH AND COLTEC INDUSTRIES
TO MERGE IN $2.2 BILLION TRANSACTION
Merger Expected To Be Accretive To
BFGoodrich EPS And Margins In First Year
Company Will Have Approximately $5.5 Billion In
Revenues And Important Franchises In Aerospace,
Performance Materials and Engineered Industrial Products
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Richfield, OH and Charlotte, NC, November 23, 1998 -- The BFGoodrich
Company (NYSE: GR) and Coltec Industries (NYSE: COT) announced today a strategic
merger that will bring together two strong, profitable companies to create an
even stronger company with important franchises in the aerospace, specialty
chemicals and engineered industrial products industries.
Under the terms of a definitive agreement, approved by the Boards of
both companies, Coltec shareholders will receive 0.56 shares of BFGoodrich
common stock for each Coltec common share. Based on BFGoodrich's closing price
of $35.94 on Friday, November 20, the transaction is currently valued at $20.13
per Coltec share, or a total of approximately $2.2 billion, including the
assumption of Coltec debt. The transaction will be accounted for as a pooling of
interests and will be tax free to Coltec shareholders.
The transaction is expected to be accretive to BFGoodrich's 1999
earnings and operating margins. The companies expect to achieve minimum annual
cost savings of approximately $60 million by 2001, with significant savings
beginning in 1999. The transaction is expected to be completed by as early as
Spring 1999 and is subject to approval by shareholders of both companies,
applicable regulatory authorities, and other customary conditions.
"This merger significantly enhances BFGoodrich's aerospace business
and -- with Coltec's high-margin engineered industrial products business -- we
are adding an important third leg that balances our aerospace and performance
materials portfolio and enhances our excellent prospects for continued growth,"
said David L. Burner, chairman and chief executive officer of BFGoodrich. "In
aerospace, the combination will increase our ability to meet customers'
increasing demand to partner with suppliers who can offer more products and more
fully integrated systems. We expect also to achieve meaningful synergies in
serving the primary and aftermarket segments of the industry."
Burner continued: "The engineered industrial products business adds
another platform for continued growth and we are delighted that John W. Guffey
Jr., Coltec's chairman and chief executive officer, will become a member of our
Board of Directors, an executive vice president of BFGoodrich, and president
and chief operating officer of the industrial business."
Burner added: "Our performance materials businesses enjoy a strong
position in the global markets they serve and we remain committed to building
these businesses as they continue to make strong contributions to revenues
and income."
Together, the companies have estimated 1998 pro forma revenues of
approximately $5.5 billion and a market capitalization of approximately
$4.0 billion. Current BFGoodrich shareholders will own approximately two-
thirds, and Coltec shareholders one-third, of the combined company. Headquarters
of The BFGoodrich Company will relocate to Charlotte, North Carolina.
Burner stated, "The decision to move our corporate headquarters out of
Northeast Ohio was extremely difficult. Nevertheless, we believe it is the right
decision at the right time for our company, our shareholders and our customers."
John Guffey, Coltec's chairman and chief executive officer said, "This
is a great merger and one that we believe is compelling for the shareholders and
customers of both companies." Guffey continued, "Both BFGoodrich and Coltec
have excellent track records in rapidly integrating acquired companies, and we
both understand what it will take to achieve the promise of this merger.
Together, the companies will have significantly greater balance, resources and
financial strength to pursue an aggressive growth strategy and to deliver
superior value for our shareholders."
In addition to Burner and Guffey, other key operating executives are
Marshall Larsen, who will be president and chief operating officer of the
combined Aerospace segment, and David Price, president and chief operating
officer of Performance Materials. Both Larsen and Price are also executive vice
presidents of BFGoodrich. Guffey and two other Coltec directors will join the
BFGoodrich Board, increasing its size from 12 to 15 members.
Morgan Stanley Dean Witter is serving as financial advisor to BFGoodrich
and Credit Suisse First Boston is serving as financial advisor to Coltec.
Coltec Industries is a leading producer of aerospace and industrial
products and is headquartered in Charlotte, NC.
BFGoodrich provides aircraft systems and services and manufactures
performance materials that are sold to customers worldwide and used in
thousands of consumer and industrial products.
***
Part of this announcement contains forward looking statements that involve risks
and uncertainties, and actual results could differ materially from those
projected in the forward-looking statements. The risks and uncertainties are
detailed from time to time in The BFGoodrich Company and Coltec Industries
reports filed with the Securities and Exchange Commission, including but not
limited to both companies' 1997 Annual Reports on Form 10-K.
Contacts:
For BFGoodrich For Coltec Industries
Media, Rob Jewell, (330) 659-7999 David Harrison, (704) 423-7010
Or Kevin Ramundo, (704) 423-7024
Investors, John Bingle (330) 659-7788 Or
Sard Verbinnen & Co.
Paul Verbinnen/David Reno/
Debra Miller (212) 687-8080
NOTE TO EDITORS: B-roll footage from both companies will be fed via satellite
at the following times and coordinates:
DAY/TIME: Monday, November 23, 1998, 8:00am - 8:15am (EST)
COORDINATES: Galaxy 6, C-Band Transponder 11, Audio 6.2 & 6.8
DAY/TIME: Monday, November 23, 1998, 2:00pm - 2:15pm (EST)
COORDINATES: Galaxy 6, C-Band Transponder 5, Audio 6.2 & 6.8