PRESS RELEASE EXHIBIT 99.2
CONTACT INFO:
CUNO: FREDERICK C. FLYNN, JR.
203/238-8847
FFLYNN@CUNO.COM
WTC: GREG JENSEN
651/554-3144
GJENSEN@PENTAPURE.COM
MAY 26, 2004
FOR IMMEDIATE RELEASE
CUNO TO ACQUIRE WTC INDUSTRIES, INC.
Meriden, CT and Eagan, MN: CUNO Incorporated (Nasdaq:CUNO) and WTC
Industries, Inc. (OTCBB: WTCO) announced today that they have entered into a
definitive merger agreement under which CUNO will acquire WTC. WTC, through its
PentaPure, Incorporated operating subsidiary, manufactures water filtration
systems and replacement filter cartridges for point-of-use applications,
including residential refrigerators and under-the-counter drinking water
systems. WTC is based in Eagan, MN and currently employs approximately 220
people. During 2003 WTC's sales totaled $28.3 million and sales for the trailing
twelve month period (through its quarter ended April 2, 2004) totaled $33.8
million. The planned combination will increase CUNO's presence in the
point-of-use water filtration products business.
Under the terms of the transaction, which was approved by both
companies' boards of directors, WTC's stockholders will receive $39.87 in cash
for each WTC share outstanding. WTC option and warrant holders will receive a
cash payment based on the difference between $39.87 per share and the exercise
price of their options and warrants. CUNO will also assume WTC's outstanding
bank debt of approximately $9.5 million, resulting in a total transaction value
of approximately $110 million. CUNO plans to finance the acquisition with a
combination of existing cash and bank financing. The acquisition is expected to
be accretive for CUNO within the first twelve months of ownership. The
transaction, which is subject to the affirmative vote of WTC's shareholders as
well as the satisfaction of customary conditions and applicable regulatory
approvals, is expected to be completed during the third quarter of CUNO's
current fiscal year.
Commenting on the transaction, Mark G. Kachur, CUNO's Chairman and
Chief Executive Officer, said "The acquisition of WTC Industries will broaden
CUNO's product line, technology portfolio and customer base and expand the
Company's presence in the water filtration business. WTC is an excellent
strategic fit with our Potable Water business, CUNO's largest and fastest
growing business. Combining CUNO's and WTC's capabilities and strengths in
engineering, innovative product development, customized manufacturing and highly
focused customer support should enable us to provide greater value to our
customers and shareholders. With the addition of WTC, we expect our worldwide
OMA sales (i.e. sales to OEMs, multi-level marketers, and appliance
manufacturers) to exceed $100 million in fiscal 2005 and our future growth
prospects in the water filtration business will be significantly enhanced."
WTC Industries' CEO James Carbonari said "In view of our rapid growth,
capital needs and opportunities in hand, we believe that this transaction is in
the best interests of
our shareholders, customers and employees. We are very excited about becoming
part of CUNO, since culturally and operationally CUNO and WTC are extremely
compatible companies. This strategic combination should enable us to leverage
our respective capabilities and talents in the water filtration business and
grow our business more effectively on a long term basis."
Citigroup Global Markets Inc. acted as financial advisor to CUNO and
Robert W. Baird & Co. acted as financial advisor to WTC.
A conference call for interested analysts and investors will be held
tomorrow at 8:30 a.m. EST. The call-in number is 1-888-423-3274. Alternatively,
visit us at www.cuno.com/investors for a live webcast of our conference call.
Also, visit www.cuno.com for additional information about CUNO and
www.pentapure.com for additional information about WTC.
About CUNO:
CUNO is a world leader in the design, manufacture and marketing of a
comprehensive line of filtration products for the separation, clarification and
purification of liquids and gases. CUNO's products, which include proprietary
depth filters and semi-permeable membrane filters, are used in the potable
water, healthcare, and fluid processing markets.
About WTC:
WTC Industries, Inc. designs and manufactures water filtration products for
point-of-use applications.
Caution Concerning Forward Looking Statements:
THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS, INCLUDING
STATEMENTS REGARDING THE ANTICIPATED TIMING OF THE TRANSACTION AND POSSIBLE
PERFORMANCE OF THE COMBINED COMPANY AFTER THE TRANSACTION IS COMPLETED. SUCH
STATEMENTS REFLECT MANAGEMENT'S BEST JUDGMENT AS OF THIS DATE, BUT THEY INVOLVE
RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY
FROM THOSE PRESENTED. FACTORS THAT COULD CAUSE SUCH DIFFERENCES INCLUDE, WITHOUT
LIMITATION, (1) THE POSSIBILITY OF CUSTOMER, SUPPLIER OR EMPLOYEE ATTRITION OR
REACTION FOLLOWING THIS TRANSACTION; (2) THE POSSIBILITY THAT REGULATORY
APPROVALS MAY BE DELAYED OR DENIED OR THAT BURDENSOME CONDITIONS MAY BE IMPOSED
IN CONNECTION WITH SUCH APPROVALS; (3) FAILURE TO FULLY REALIZE THE EXPECTED
GROWTH POTENTIAL AND COST SAVINGS FROM THE TRANSACTION; (4) LOWER THAN EXPECTED
REVENUES FOLLOWING THE TRANSACTION; (5) PROBLEMS OR DELAYS IN INTEGRATING THE
TWO COMPANIES; (6) THE POSSIBILITY OF ADVERSE CHANGES IN GLOBAL, NATIONAL OR
LOCAL ECONOMIC OR MONETARY CONDITIONS; (7) COMPETITION AND CHANGE IN THE WATER
FILTRATION BUSINESS; AND (8) OTHER FACTORS DESCRIBED IN EITHER CUNO'S OR WTC'S
RECENT FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. THOSE FACTORS OR
OTHERS COULD RESULT, FOR EXAMPLE, IN DELAY OR TERMINATION OF THE TRANSACTION
DISCUSSED ABOVE. READERS SHOULD CAREFULLY CONSIDER THOSE RISKS AND UNCERTAINTIES
IN READING THIS RELEASE. EXCEPT AS OTHERWISE REQUIRED BY LAW, CUNO AND WTC
DISCLAIM ANY OBLIGATION TO UPDATE ANY FORWARD-LOOKING STATEMENTS INCLUDED HEREIN
TO REFLECT FUTURE EVENTS OR DEVELOPMENTS.
# # #
IN CONNECTION WITH THE PROPOSED TRANSACTION, WTC INDUSTRIES WILL BE
FILING PROXY STATEMENTS AND OTHER MATERIALS WITH THE SECURITIES AND EXCHANGE
COMMISSION. INVESTORS ARE URGED TO READ THE PROXY STATEMENT AND THESE MATERIALS
WHEN THEY ARE AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION. WTC
INDUSTRIES AND ITS OFFICERS AND DIRECTORS MAY BE DEEMED TO BE PARTICIPANTS IN
THE SOLICITATION OF PROXIES WITH RESPECT TO THE PROPOSED TRANSACTION.
INFORMATION REGARDING SUCH INDIVIDUALS IS INCLUDED IN WTC'S INFORMATION
STATEMENTS AND ANNUAL REPORTS ON FORM 10-KSB PREVIOUSLY FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, AND IN THE PROXY STATEMENT RELATING TO THE
MERGER WHEN IT BECOMES AVAILABLE. INVESTORS MAY OBTAIN A FREE COPY OF THE PROXY
STATEMENTS AND OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE AS WELL AS
OTHER MATERIALS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION CONCERNING WTC
INDUSTRIES AND THESE INDIVIDUALS AT THE SECURITIES AND EXCHANGE COMMISSION'S
WEBSITE AT HTTP://WWW.SEC.GOV. THESE MATERIALS AND OTHER DOCUMENTS MAY ALSO BE
OBTAINED WITHOUT CHARGE BY CONTACTING: WTC INDUSTRIES, INC, 1000 APOLLO ROAD,
EAGAN MINNESOTA 55121, ATTN: GREGORY P. JENSEN.