EXHIBIT 3
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AZZ incorporated Closes Acquisition of Central
Electric; Announces Acquisition of Carter and
Crawley, Inc.
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Acquisitions to be immediately accretive to earnings and will bring annualized
revenue run rate to $200 million
Contact: Dana Perry, Vice President - Finance and CFO
AZZ incorporated 817-297-4361
Internet: www.azzincorporated.com
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RCG Capital Markets Group, Inc. 480-675-0400
Retail: Joe Diaz, Brett Maas
Institutional/Analysts: Joe Dorame
Media: Jeff Stanlis
Internet: www.rcgonline.com
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(CROWLEY, Texas) November 5, 2001 /PRNewswire/ -- AZZ incorporated (NYSE:AZZ), a
manufacturer of electrical products and a provider of galvanizing services,
today announced that it has completed the acquisitions of two privately held
companies: Central Electric Company and Carter & Crawley, Inc. The two
acquisitions combined with AZZ's strong internal growth rate of electrical
products, will bring the company's annualized revenue to a run rate of
approximately $200 million, and backlog of approximately $100 million.
Management expects both acquisitions to be immediately accretive to earnings.
The operating results of the acquired companies will be consolidated with AZZ's
effective November 1, 2001.
"We are extremely pleased to not only report the completion of the previously
announced acquisition of the Central Electric Company but additionally the
acquisition of Carter & Crawley, Inc." said David H. Dingus, president and chief
executive officer of AZZ incorporated. "Simultaneously bringing them into our
organization increases the synergies between the three organizations. We
believe this is another example of our stated strategic goal: providing more
products to the same customers. The additional products that will be added will
enhance our position as a Provider of Proven Solutions."
Central Electric, www.poweraisle.com, is made up of three product offerings.
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They manufacture specialty metalclad switchgear in Fulton Missouri, power
distribution centers through their EPSI Division
continued
in Tulsa, Oklahoma, a direct competitor to AZZ's Atkinson Division, and relay
panels and non-segregated bar bus in their Clark Control Systems Division in
Nashville, Tennessee. "Central adds $50 million to our annual revenues and will
be accretive immediately. The accretion should increase as we take advantage of
the numerous synergies associated with this transaction," Mr. Dingus said. "The
continuity of management and key employees, will accelerate the assimilation
into our organization and strategies. We are very familiar with the company and
their products, as over the years they have been a supplier, customer and
competitor of AZZ in the power generation, transmission and distribution
markets."
The strategic acquisition of Carter & Crawley, Inc., headquartered in
Greenville, South Carolina, www.cartercrawley.com, not only compliments AZZ but
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also Central Electric," Mr. Dingus continued. "We are bringing together two
competitors within the relay and control panel markets. The two companies
significantly expand our market share and assures our position as a leading
supplier. In addition to the manufacture of relay and control panels, they have
extensive experience in custom design, programming, and turnkey field
installation. All of AZZ's operations are experiencing increased demand for
turnkey installation. We hope to leverage off their extensive experience to
expand our product offering to include installation, as well as field repair
services. Carter & Crawley's annual revenues are $20 million and we expect it
to be immediately accretive."
The acquisition cost of Central Electric of approximately $28 million was paid
with $17 million in cash, $9 million in assumption of debt, and $1.8 million in
AZZ stock. The Carter & Crawley's net acquisition cost of approximately $13
million was paid in cash. These funds were available under AZZ's new $85
million bank syndication. With the two acquisitions, AZZ has drawn
approximately $65 million on the line, including the funds used to repay AZZ's
existing debt, the payoff of assumed debt of Central Electric and cash paid to
the shareholders of both acquired companies.
"Due to the financial strength of the company, and the favorable impact of
adding two strategic acquisitions to compliment our double digit internal growth
rate of our Electrical and Industrial Products Segment, we were able to put in
place a new syndicated bank facility in a timely manner and at favorable rates,"
Mr. Dingus said. "The new facility is made up of a $40 million term loan
amortized over four years, and a $45 million revolving line of credit. Based
upon extensive modeling that we have done for additional acquisitions and
growth, we believe that the combination of availability under the agreement
combined with strong cash flows will facilitate further implementation of our
growth strategy."
continued
AZZ incorporated is a specialty electrical equipment manufacturer serving the
global growth markets of power generation, transmission and distribution, as
well as, a leading provider of hot dip galvanizing services to the steel
fabrication market nationwide.
Except for the statements of historical fact, this release may contain forward-
looking statements that involve risks and uncertainties some of which are
detailed from time to time in documents filed by the Company with the SEC. Those
risks and uncertainties include, but are not limited to: changes in demand,
prices and raw material costs, including zinc and natural gas which are used in
the hot dip galvanizing process; changes in the economic conditions of the
various markets the Company serves, foreign and domestic, acquisition
opportunities, adequacy of financing, and availability of experienced management
employees to implement the Company's growth strategy; and customer demand and
response to products and services offered by the Company. The Company can give
no assurance that such forward-looking statements will prove to be correct.
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