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EXHIBIT 99.1
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FOR IMMEDIATE RELEASE
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August 8, 2001
Contact: John Breed Joele Frank or Andy Brimmer
Cooper Industries, Inc. Joele Frank, Wilkinson Brimmer Katcher
(713) 209-8835 (212) 355-4449
COOPER INDUSTRIES BOARD OF DIRECTORS REJECTS DANAHER'S
UNSOLICITED, INADEQUATE AND CONDITIONAL PROPOSAL
AUTHORIZES EXPLORATION OF STRATEGIC ALTERNATIVES
POSTPONES SPECIAL SHAREHOLDER MEETING
HOUSTON, TX, Aug. 8 -- Cooper Industries, Inc. (NYSE: CBE) today announced that
its Board of Directors has determined unanimously to reject Danaher
Corporation's (NYSE: DHR) unsolicited, inadequate and highly conditional
proposal.
After careful consideration of Danaher's proposal, including
consultation with independent financial and legal advisors, Cooper's Board of
Directors has determined that Danaher's proposal is not in the best interests
of Cooper, its shareholders, employees and other constituencies. In particular,
the Board noted that Danaher's unsolicited proposal is highly conditional as it
presents an uncertain value based on a range of prices and is subject to due
diligence. In addition, based on the advice of its financial advisor, Credit
Suisse First Boston Corporation, the Cooper Board of Directors concluded that
the proposal was inadequate.
"We believe that Danaher's proposal is an attempt to coerce Cooper
shareholders into accepting an opportunistic bid to acquire Cooper at a low
price," said H. John Riley, Jr., chairman, president and chief executive
officer of Cooper. "The value of Danaher's proposal is highly conditional.
Danaher has made it clear that its proposal is very favorable to the Danaher
stockholders, but our Board's responsibility is to maximize value for Cooper's
shareholders."
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COOPER INDUSTRIES, INC. PAGE 2
"We do not believe that Danaher's proposal adequately reflects, among
other things, the value of Cooper's strong business platforms, global
franchise, market position and portfolio of leading brand name products. Our
product line breadth is unmatched by almost any other company in our industry.
Our products - including such world-class brand names as Buss, B-Line,
Crouse-Hinds, Halo, Menvier, McGraw-Edison, Crescent and Nicholson - today have
leading positions in the markets we serve. Danaher also has taken into
consideration only nominal synergies even though previous discussions between
the two companies indicated significantly higher synergistic opportunities,"
Mr. Riley continued.
Cooper also announced that its Board has authorized management and its
financial advisor to explore all strategic alternatives that would maximize
shareholder value. These alternatives will include the exploration of mergers,
sales, strategic alliances, acquisitions or other similar strategic
alternatives. Cooper noted that there could be no assurance that the
exploration of strategic alternatives would result in any agreement or
transaction.
Mr. Riley added, "Our Board and management have always been committed
to enhancing shareholder value. We intend to continue to act responsibly to
address the interests of our shareholders."
The Cooper Board also announced the August 30th Special Meeting of
Shareholders to vote on Cooper's plan to reorganize and change its place of
incorporation from Ohio to Bermuda has been postponed.
"We have concluded that no purpose is served by affording Danaher the
opportunity to perpetuate misconceptions about the merits of our
reincorporation. It is important that we direct our attention to exploring all
strategic alternatives without the distraction of a proxy contest with
Danaher," continued Mr. Riley.
"We continue to believe that the reincorporation of Cooper would bring
significant value to all of our constituencies, most importantly our
shareholders. Contrary to Danaher's public statements, completion of the
reincorporation would have no negative impact on Danaher's subsequent ability
to acquire the Company. Should Danaher wish to unwind the reincorporation, it
could do so quickly with insignificant negative tax implications," concluded
Mr. Riley.
Credit Suisse First Boston Corporation is serving as financial advisor
to Cooper Industries, and Skadden, Arps, Slate, Meagher & Flom LLP is serving
as legal counsel.
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COOPER INDUSTRIES, INC. PAGE 3
The following letter was sent from Mr. Riley on August 8, 2001 to H.
Lawrence Culp, Jr., president and chief executive officer of Danaher
Corporation:
August 8, 2001
Mr. H. Lawrence Culp, Jr.
President and Chief Executive Officer
Danaher Corporation
2099 Pennsylvania Avenue, N.W., 12th Floor
Washington, D.C. 20006-1813
Dear Larry:
After careful consideration of Danaher's proposal, including
consultation with our independent financial and legal advisors,
Cooper's Board of Directors has determined that Danaher's proposal is
not in the best interests of Cooper, our shareholders, employees and
other constituencies.
We believe that your unsolicited proposal is highly conditional as it
presents an uncertain value based on a range of prices and is subject
to due diligence. Based on the advice of our financial advisor, Credit
Suisse First Boston Corporation, our Board of Directors also has
concluded that the proposal is inadequate. We believe that Danaher's
proposal fails to reflect, among other things, the value of Cooper's
strong business platform, global franchise, market position and
portfolio of leading brand name products. We believe that your
proposal is an attempt to coerce Cooper shareholders into accepting an
opportunistic bid to acquire Cooper at a low price.
As we are announcing today in a press release, our Board has
authorized management and its advisors to explore all strategic
alternatives that would maximize shareholder value. These alternatives
will include the exploration of mergers, sales, strategic alliances,
acquisitions or other similar strategic alternatives. Should Danaher
so desire, it may engage in this process on the same basis as other
participants.
In light of Danaher's attempt to use Cooper's plan to reincorporate in
Bermuda as a public referendum on Danaher's acquisition proposal, and
to ensure that we are able to focus on the exploration of strategic
alternatives as well as our business and operations, Cooper has
postponed its August 30th Special Meeting of Shareholders.
Sincerely,
/s/
H. John Riley, Jr.
Chairman, President and Chief Executive Officer
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COOPER INDUSTRIES, INC. PAGE 4
Statements in this news release are forward-looking under the Private
Securities Litigation Reform Act of 1995. These statements are subject to
various risks and uncertainties, many of which are outside the control of the
Company, including but not limited to: 1) the pace of recovery of the domestic
economy; 2) the level of market demand for the Company's products and
improvement in electronic and telecommunications sectors; 3) the rate at which
benefits are realized from cost-reduction programs recently completed,
currently under way or to be initiated in the near future; 4) competitive
pressures and future global economic conditions; and 5) the ability to realize
the benefits of the reorganization, if implemented.
Further information regarding these and other risk factors is set forth
in Cooper's filings with the Securities and Exchange Commission, including
Cooper's Annual Report on Form 10-K.
Cooper Industries, with 2000 revenues of $4.5 billion, is a worldwide
manufacturer of electrical products, tools and hardware. Additional information
about Cooper is available on the Company's Internet site:
www.cooperindustries.com.
FINANCIAL TELECONFERENCE AND WEBCAST:
Cooper will host a conference call on August 8, 2001 at 10:00 a.m. EDT
to discuss this announcement. Investors, the news media, and others may listen
to the teleconference by calling 212-896-6119. Please call at least 15 minutes
prior to the start of the teleconference and ask to be connected to the Cooper
Industries conference call. A recording of this call will be available
beginning at 1:00 p.m. EDT on August 8, 2001 through 12:00 p.m. EDT on August
10, 2001 by dialing 858-812-6440, conference ID # 19516005.
The teleconference will also be webcast at www.cooperindustries.com by
clicking on an available audio link. This webcast will be archived on the
Company's web site for replay purposes through 12:00 p.m. EDT on August 10,
2001. Real Network's Real Player or Microsoft Media Player is required to
access the webcast. They can be downloaded from www.real.com or
www.microsoft.com.
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