Hardinge Inc. Announces an Agreement to Acquire Forkardt Operations
Acquisition Will Reinforce Leadership Position as Designer and Manufacturer of
Workholding Solutions for Machine Tools
ELMIRA, N.Y., May 9, 2013 (GLOBE NEWSWIRE) -- Hardinge Inc. (Nasdaq:HDNG), a
leading international provider of advanced metal-cutting solutions, announced
that it has entered into a definitive agreement to acquire Forkardt from
Illinois Tool Works (NYSE:ITW) for $34 million in a negotiated transaction.
The acquisition, which is expected to be completed today, will be funded with
a combination of cash and debt. With well-established brands, Forkardt
includes companies that are leading global providers of high-precision,
specialty and customized workholding devices for machine tools. Its
headquarters and U.S. operations are in Traverse City, Michigan. It also has
operations in France, Germany, and Switzerland.
"Our acquisition of Forkardt will strengthen and expand our leadership
position in specialty workholding solutions around the world," stated Richard
L. Simons, Chairman, President and Chief Executive Officer of Hardinge. "Our
strategy is to diversify our product offerings in workholding, accessories and
spare parts as a means of reducing the impact of the highly cyclical nature of
machine tool sales. These products tend to be more stable despite economic
cycles and typically also have higher margins. Historically, accessories and
repair parts have averaged around 22% to 25% of our total revenue. On a
pro-forma basis, we expect this product line to represent more than 30% of our
Forkardt was founded in Germany in 1923 by Paul Forkardt, as a manufacturer of
chucks. In 2004, Forkardt merged with ITW Workholding, a North American
manufacturer of workholding devices, and has become what Forkardt is today.
The combined company evolved to be a global leader in innovation, design and
manufacture of high precision, high quality, specialty and custom designed
rotating workholding devices for machine tools. The legacy brands include:
Forkardt, NA Woodworth, Buck Chuck, Sheffler Collet, and Logansport Cylinder.
Forkardt's revenue in 2012 was $47 million. Hardinge expects the acquisition
to be accretive in 2013. Concurrent with the acquisition, William Sepanik,
formerly Group General Manager of Forkardt, will be appointed Vice President –
Forkardt and will report to Hardinge's President and CEO.
The design, manufacturing, sales and distribution of Forkardt's accessory
products will be completely separate from Hardinge's machine tool
manufacturing operations and sales. Mr. Simons noted, "We believe the
separation of management and operations of Forkardt products from the
manufacture and sales of machines ensures the segregation of focus and
information flow as should be expected by the machine tool manufacturers who
buy Forkardt products for use on their brands."
He concluded, "Global machine tool consumption is expected to expand by
approximately 35% in the next four years driven by China's developing economy,
according to the Oxford Economic Group. We are confident that our accessory
products have an excellent opportunity to participate in that growth, where
our workholding presence is minimal. We expect that through continued product
innovation, quality products and timely deliveries, we can gain global market
share for our products. We believe there will also be opportunities for other
relatively small, add-on acquisitions that will be available from time-to-time
to expand this product line."
The Company plans to discuss its financial results and the Forkardt
acquisition on its conference call today at 11:00 am ET. The conference call
can be accessed by calling (201) 689-8560. The listen-only audio webcast will
be available at www.hardinge.com.
Hardinge is a leading global designer and manufacturer of high precision,
computer-controlled machine tool solutions developed for critical, hard to
machine metal parts. The Company's strategy is to leverage its global brand
strength to further penetrate global market opportunities where customers will
benefit from the technologically advanced, high quality, reliable equipment
Hardinge produces. With approximately 75% of its sales outside the U.S.,
Hardinge serves the worldwide metal working market. Hardinge's machine tool
solutions can also be found in a broad base of industries to include
aerospace, agricultural, automotive, construction, consumer products, defense,
energy, medical, technology and transportation.
Hardinge applies its engineering design and manufacturing expertise in high
performance machining centers, high-end cylindrical and jig grinding machines,
SUPER-PRECISION^® and precision CNC lathes and technologically advanced
workholding accessories. Hardinge has manufacturing operations in China,
France, Germany, Switzerland, Taiwan, the United Kingdom and the United
The Company regularly posts information on its website:
Safe Harbor Statement
This news release contains forward-looking statements (within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended). Such statements are based on
management's current expectations that involve risks and uncertainties. Any
statements that are not statements of historical fact or that are about future
events may be deemed to be forward-looking statements. For example, words such
as "may," "will," "should," "estimates," "predicts," "potential," "continue,"
"strategy," "believes," "anticipates," "plans," "expects," "intends," and
similar expressions are intended to identify forward-looking statements. The
Company's actual results or outcomes and the timing of certain events may
differ significantly from those discussed in any forward-looking statements.
The Company undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events, or
Edward J. Gaio
Chief Financial Officer
Phone: (607) 378-4207
Deborah K. Pawlowski, Kei Advisors LLC
Phone: (716) 843-3908
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