Exhibit 99.3
FOR IMMEDIATE RELEASE
Media Contact Information: Investor Contact Information:
Lori Gorski J. Timothy Corcoran
Phone: 781-622-1242 Phone: 781-622-1111
E-mail: lori.gorski@thermo.com E-mail: tim.corcoran@thermo.com
Website: www.thermo.com
Thermo Electron to Acquire Kendro Laboratory Products
Company to host conference call on Thursday, January 20, 2005 at 8:30 a.m. EST
WALTHAM, Mass. (January 19, 2005) - Thermo Electron Corporation (NYSE:TMO)
announced today that it has entered into a definitive agreement to acquire the
Kendro Laboratory Products division of SPX Corporation (NYSE:SPW), for $833.5
million in cash, subject to a post-closing balance sheet adjustment. Thermo has
received a commitment for a credit facility of $600 million to finance a portion
of the purchase price. The transaction is subject to regulatory approvals and
other customary closing conditions.
It is estimated that in the first full year of financial consolidation, this
acquisition will be accretive to adjusted EPS by at least $0.10 per share and
will be slightly dilutive to GAAP earnings per share (EPS). It is expected to be
accretive to GAAP earnings per share (EPS) in the second full year. Adjusted EPS
excludes restructuring and other costs/income and amortization of
acquisition-related intangible assets. A more extensive definition of adjusted
EPS appears at the end of this press release under the heading, "Use of Non-GAAP
Financial Measures."
Kendro designs, manufactures, markets and services a wide range of laboratory
equipment for sample preparation, processing and storage used primarily in life
sciences and drug discovery laboratories as well as in clinical laboratories.
With 2004 sales estimated at $375 million, Kendro has estimated EBITA margins of
17-18 percent. The company is headquartered in Asheville, North Carolina, and
employs more than 1,600 associates worldwide. The company has extensive
manufacturing and design facilities in the United States and Germany, and direct
sales, service and support operations throughout Europe, North America and Asia.
Kendro's centrifuge offerings, known to customers by names such as Sorvall(R)
and Heraeus(R), cover applications ranging from the separation of DNA to the
separation of whole cells for use in biochemistry, molecular biology, virology,
diagnostics and other clinical and research applications. Kendro's thermal
equipment offerings include ovens, incubators, freezers and refrigerators for
research and industrial applications, marketed under the brands Revco(R) and
Jewett(R). In addition to equipment solutions, Kendro provides its customers
with comprehensive services through a global network of technicians, and offers
integrated validation services and bio-repositories for sample storage and
laboratory relocation management.
"As a company, Thermo is focused on providing total laboratory solutions and
services to address our customers' needs, and Kendro's technologies nicely
complement our existing portfolio of
products and services," said Marijn E. Dekkers, president and chief
executive officer of Thermo Electron. "Like Thermo, Kendro enjoys a rich history
and culture of innovation based on addressing the unique and changing needs of
customers. The combined company allows us to deliver even greater value to our
customers by creating a broader offering of laboratory and sample preparation
technologies, as well as enhanced laboratory service capabilities."
Mr. Dekkers continued, "This acquisition provides an attractive financial
profile for Thermo Electron in terms of earnings and cash flow generation. This
transaction also underscores our intent to use acquisitions to gain access to
technologies that are of interest to our customers."
Conference Call
Thermo will hold a conference call and live Webcast on Thursday, January 20, at
8:30 a.m. Eastern Standard Time to provide more information about the
acquisition. To listen to the audio portion of the Webcast dial 888-872-9028
within the U.S., or 973-633-6740 outside the U.S. You may also listen to the
call live and view the presentation material on the Web by visiting
http://www.thermo.com. Click on "About Thermo," then "Investors." An audio
archive of the call will be available in that section of our Website until
February 18, 2005. You will also find this press release under the heading
"Press Releases" and the Webcast presentation materials under the heading
"Presentations" in the "Investors" section of our Website.
About Thermo Electron
Thermo Electron Corporation is the world leader in analytical instruments. Our
instrument solutions enable our customers to make the world a healthier, cleaner
and safer place. Thermo's Life and Laboratory Sciences segment provides
analytical instruments, scientific equipment, services and software solutions
for life science, drug discovery, clinical, environmental and industrial
laboratories. Thermo's Measurement and Control segment is dedicated to providing
analytical instruments used in a variety of manufacturing processes and
in-the-field applications, including those associated with safety and homeland
security. Based near Boston, Massachusetts, Thermo has revenues of more than $2
billion, and employs approximately 10,000 people in 30 countries. For more
information, visit www.thermo.com.
Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with generally
accepted accounting principles (GAAP), we use certain non-GAAP financial
measures, including adjusted EPS, which exclude restructuring and other
costs/income and amortization of acquisition-related intangible assets. Adjusted
EPS also excludes certain other gains and losses, tax provisions/benefits
related to the previous items and benefit from tax credit carryforwards. We
exclude these items because they are outside of our normal operations and, in
certain cases, are difficult to forecast accurately for future periods. We
believe that the inclusion of such measures helps investors to gain a better
understanding of our core operating results and future prospects, consistent
with how management measures and forecasts the company's performance, especially
when comparing such results to previous periods or forecasts.
Thermo's guidance as to the expected impact that the acquisition will have on
Thermo's earnings per share is only provided on an adjusted basis. It is not
feasible to provide the expected impact that the acquisition will have on a GAAP
basis because the items excluded are difficult to predict and estimate and are
primarily dependent on future events, such as the determination of the
portion of the purchase price attributable to identifiable intangible
assets and the amortization thereof and decisions concerning the location and
timing of facility consolidations.
The following constitutes a "Safe Harbor" statement under the Private Securities
Litigation Reform Act of 1995: This press release contains forward-looking
statements that involve a number of risks and uncertainties. Important factors
that could cause actual results to differ materially from those indicated by
such forward-looking statements are set forth under the heading,
"Forward-Looking Statements" in the company's Quarterly Report on Form 10-Q for
the fiscal quarter ended October 2, 2004. These include risks and uncertainties
relating to: the need to develop new products and adapt to significant
technological change; dependence on customers that operate in cyclical
industries; general worldwide economic conditions and related uncertainties; the
effect of changes in governmental regulations; dependence on customers' capital
spending policies and government funding policies; use and protection of
intellectual property; exposure to product liability claims in excess of
insurance coverage; retention of contingent liabilities from businesses we sold;
realization of potential future savings from new productivity initiatives;
implementation of new branding strategy; implementation of strategies for
improving internal growth; the effect of exchange rate fluctuations on
international operations; identification, completion and integration of new
acquisitions; and potential impairment of goodwill from previous acquisitions.
We undertake no obligation to publicly update any forward-looking statement,
whether as a result of new information, future events or otherwise.
###