Greenbrier Board Of Directors Determines Icahn's Proposal Grossly Undervalues
Company Remains Willing to Continue Discussing Various Combinations of
Greenbrier and American Railcar Industries
LAKE OSWEGO, Ore., Dec. 18, 2012
LAKE OSWEGO, Ore., Dec. 18, 2012 /PRNewswire/ --The Greenbrier Companies,
Inc. (NYSE: GBX) ("Greenbrier" or "the Company") today disclosed that the
Company and its advisors have been engaged in discussions with Carl Icahn and
his associates regarding an acquisition of Greenbrier by American Railcar
Industries, Inc. (NASDAQ: ARII) ("American Railcar") or an acquisition of
American Railcar by Greenbrier.
While Mr. Icahn's 13D/A disclosed a conditional proposal to acquire Greenbrier
for $20 per share in cash, the Company noted that in previous conversations
with Greenbrier, Mr. Icahn talked about an acquisition of Greenbrier at a
price of between $20 and $22 per share in cash. The Greenbrier Board of
Directors believes a price range of $20 - $22 per share is inadequate, grossly
undervalues the Company and is not in the best interests of Greenbrier
Greenbrier has repeatedly made clear to Mr. Icahn its interest in acquiring
American Railcar at a modest premium, taking into account the current full
valuation of American Railcar's stock.
The Greenbrier Board believes that a combination of Greenbrier and American
Railcar could be beneficial to both companies and their stockholders, and that
there could be substantial synergies achieved through such a combination. The
Board remains ready and willing to continue discussions with Mr. Icahn and to
consider any combination of Greenbrier and American Railcar that would be in
the best interest of the Company's stockholders. However, the Board will not
support a transaction that undervalues the Company and the potential benefits
to American Railcar, or overvalues American Railcar.
Greenbrier's integrated business model and diversified product offerings
enhance financial performance across the business cycle, create powerful
cross-selling opportunities and capture value for both Greenbrier and its
customers throughout the life of a railcar. Greenbrier's diverse product
offerings serve a broad array of commodities, such that the Company is not
dependent on only a few drivers of demand. Over the last several years, the
Company has grown its share, particularly in tank and hopper cars, as a result
of its strategy. The Company continues to ramp up tank car production to an
annual rate of 3,000 cars, three times as many tank cars as the Company
delivered in fiscal 2012, with a targeted 20 percent share of normalized
demand in the tank car segment. Over the cycle, demand for tank cars is
forecasted to slow down and be replaced by demand for other railcar types.
Greenbrier is well-positioned to adapt to these changes. In light of the
Company's integrated strategy and low-cost manufacturing footprint, as well as
the benefits to Greenbrier of a more broad based economic recovery, Mr.
Icahn's proposal grossly undervalues the Company.
Goldman, Sachs & Co. and Bank of America Merrill Lynch are serving as the
Company's financial advisers and Skadden, Arps, Slate, Meagher & Flom LLP and
Tonkon Torp LLP are legal advisers.
Greenbrier (www.gbrx.com), headquartered in Lake Oswego, Oregon, is a leading
supplier of transportation equipment and services to the railroad industry.
Greenbrier builds new railroad freight cars in its four manufacturing
facilities in the U.S. and Mexico and marine barges at its U.S. facility. It
also repairs and refurbishes freight cars and provides wheels and railcar
parts at 39 locations across North America. Greenbrier builds new railroad
freight cars and refurbishes freight cars for the European market through both
its operations in Poland and various subcontractor facilities throughout
Europe. Greenbrier owns approximately 10,000 railcars, and performs management
services for approximately 221,000 railcars.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: This release may contain forward-looking statements, including
statements regarding expected new railcar production volumes and schedules,
expected customer demand for the Company's products and services, plans to
increase manufacturing capacity, new railcar delivery volumes and schedules,
growth in demand for the Company's railcar services and parts business, and
the Company's future financial performance. Greenbrier uses words such as
"anticipates," "believes," "forecast," "potential," "contemplates,"
"expects," "intends," "plans," "seeks," "estimates," "could," "would," "will,"
"may," "can," and similar expressions to identify forward-looking statements.
These forward-looking statements are not guarantees of future performance and
are subject to certain risks and uncertainties that could cause actual results
to differ materially from in the results contemplated by the forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, reported backlog is not indicative of our financial results;
turmoil in the credit markets and financial services industry; high levels of
indebtedness and compliance with the terms of our indebtedness; write-downs of
goodwill, intangibles and other assets in future periods; sufficient
availability of borrowing capacity; fluctuations in demand for newly
manufactured railcars or failure to obtain orders as anticipated in developing
forecasts; loss of one or more significant customers; customer payment
defaults or related issues; actual future costs and the availability of
materials and a trained workforce; failure to design or manufacture new
products or technologies or to achieve certification or market acceptance of
new products or technologies; steel or specialty component price fluctuations
and availability and scrap surcharges; changes in product mix and the mix
between segments; labor disputes, energy shortages or operating difficulties
that might disrupt manufacturing operations or the flow of cargo; production
difficulties and product delivery delays as a result of, among other matters,
changing technologies, production of new railcar types, or non-performance of
subcontractors or suppliers; ability to obtain suitable contracts for the sale
of leased equipment and risks related to car hire and residual values;
difficulties associated with governmental regulation, including environmental
liabilities; integration of current or future acquisitions; succession
planning; all as may be discussed in more detail under the headings "Risk
Factors" and "Forward Looking Statements" in our Annual Report on Form 10-K
for the fiscal year ended August 31, 2012, and our other reports on file with
the Securities and Exchange Commission. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect management's
opinions only as of the date hereof. Except as otherwise required by law, we
do not assume any obligation to update any forward-looking statements.
SOURCE The Greenbrier Companies, Inc. (GBX)
Contact: Mark Rittenbaum, The Greenbrier Companies, Inc., +1-503-684-7000; or
Matthew Sherman/Andrew Siegel/Aaron Palash, Joele Frank, Wilkinson Brimmer
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