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1 May 2013
MELROSE INDUSTRIES PLC
Melrose Industries PLC announces the sale of Truth Hardware
Melrose Industries PLC ('Melrose') announces that it has signed a conditional agreement for the disposal of Truth Hardware ('Truth') to Tyman PLC ('Tyman').
· The total consideration of US$200 million (£129 million)(1) is payable in cash on completion. The consideration is on a debt and cash free basis.
· For the year ended 31 December 2012, Truth recorded sales of US$126.0 million, operating profit of US$18.6 million and EBITDA(2) of US$22.5 million.
· Melrose intends to use the proceeds to pay down existing borrowings. The Disposal is conditional upon Tyman's firm placing and placing and open offer in connection with its equity fundraising becoming effective and anti-trust clearance in the US. Completion is expected to occur in June 2013.
Simon Peckham, Chief Executive of Melrose, said:
"We are very pleased with the progress Truth has made since our acquisition of FKI Plc in 2008 and we believe it is now well placed for the future. As planned at acquisition, we are disposing of Truth at the early stages of what appears to be a recovery in the United States housing market. Tyman is well positioned to add further value to the business and we wish them and Truth all future success."
Melrose is being advised by Robert W. Baird & Co. regarding the Disposal.
(1) Using an exchange rate as at 30 April 2013 of £1 = US$1.55.
(2) Operating profit before depreciation and amortisation.
Ann-marie Wilkinson/Andrew Benbow
+44 (0)20 7920 2330
Notes to Editors
Information on Truth Hardware
Truth is a leading designer and manufacturer of quality operating hardware in North America for residential and light commercial windows and doors. Truth sells its products directly to the manufacturers of residential and light commercial windows and doors. Truth operates from facilities in Owatonna, MN and Brampton, Canada.
In the year ended 31 December 2012, Truth generated revenue, EBITDA(2) and operating profit of US$126.0 million, US$22.5 million and US$18.6 million respectively. Truth's gross assets were US$61.3 million as at 31 December 2012. The purchase price is equivalent to 10.7 times 2012 operating profit and 8.9 times 2012 EBITDA(2) for Truth.
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