WHITE PLAINS, N.Y., April 21 /PRNewswire/ -- ITT Industries, Inc.
(NYSE: IIN) and Goulds Pumps, Incorporated (Nasdaq: GULD) announced today that
both companies' boards of directors have approved a definitive agreement under
which ITT Industries will acquire Goulds for $37 a share or approximately
$815 million in cash, plus assumption of $119 million of Goulds' debt. Under
the agreement, a cash tender offer will be commenced by a wholly owned
subsidiary of ITT Industries no later than April 25, 1997 to acquire all of
the outstanding shares of Goulds.
The tender offer will be subject to the valid tender of Goulds' shares
representing a majority of the voting power of Goulds, the expiration of
waiting periods under applicable antitrust and competition laws, and other
customary closing conditions. The tender offer is expected to be completed in
"This combination will create the world's largest pump producer and
contribute significant efficiencies for both growth and cost improvement,"
said Travis Engen, chairman president and chief executive of ITT Industries.
"It increases our participation in one of our most profitable and fastest-
growing business segments. Once the acquisition is completed, our fluid
technology business will represent more than 20 percent of sales and over
25 percent of operating income, creating a global leader in a growing industry
that is beginning to consolidate. We expect the acquisition to enhance
earnings growth, with an accretive impact in its first full year and
significant contributions thereafter. This transaction is the most dramatic
step to date in our long-term strategy of building shareholder value."
"We are pleased that ITT Industries recognizes Goulds' proud history, our
strong name and many gains we have recently achieved," said Goulds' chairman
and chief executive officer, Thomas C. McDermott. "Goulds and ITT Industries
will be an important combination. We look forward to working with ITT
Industries' management team in taking full advantage of the opportunities
created through our combined capabilities."
Benefits for Growth and Cost Improvement
"This is a superb fit," Mr. Engen emphasized. "On the revenue side, the
products of ITT Industries' fluid technology business and Goulds complement
each other perfectly. For example, Goulds is one of the leading producers of
pumps for the industrial sector while ITT Industries is a world leader in
submersible pumps for municipal water treatment worldwide. The cost benefits
available in this combination flow from greater economies in purchasing,
manufacturing, marketing and sales, R&D and support functions.
"In addition, there are important geographic efficiencies, especially in
some of the world's fastest growing markets," Mr. Engen said. "For instance,
in the Pacific Rim, ITT Industries' distribution points in Australia, New
Zealand, Vietnam and several Central Asian republics, are complemented by
Goulds' distribution in The Philippines, Korea and Thailand. We both have
operations in China, Taiwan, Singapore, Malaysia and Indonesia. In Latin
America, our operations in Chile, Argentina and Brazil will be enhanced by
Goulds' presence in Mexico and Venezuela."
"We are bringing together two proven leaders in their respective segments
of the fluid products industry serving more than 130 nations. The industry's
growth and profit potential is most promising in the developing world, where
the combined company will have access to the full range of infrastructure-
related and industrial markets," Mr. Engen added.
"Together we will focus on continuing to improve operations and serving
customers better and more efficiently through our global distribution
networks. The fluid businesses of ITT Industries and Goulds will accelerate
their progress in complementary business sectors," said Mr. Engen.
Goulds Pumps, Inc. is a leading worldwide supplier of industrial,
residential and commercial pumps, parts and accessories. Headquartered in
Fairport, New York, the company had 1996 revenues of $774 million and employs
over 5,200 people throughout the world. The company has a respected position
in a number of process industries and is a major supplier to engineering
contractors around the world. Goulds is also the world's leading manufacturer
of residential well-water pump systems.
ITT Industries' fluid technology business specializes in the manufacture
of pumps, valves, heat exchangers and related equipment used to move, measure
and control fluids. With 1996 sales of $1.3 billion in the fluid technology
segment, the company provides products serving markets that include
wastewater treatment, chemical processing, construction, bio-pharmaceutical,
aerospace, and general industry. With sales offices in over 100 countries,
ITT Fluid Technology is growing rapidly in emerging markets around the globe.
The company's brand names include Flygt, Bell and Gossett, A-C Pump, Richter
ITT Industries (http://www.ittind.com) is a leading global diversified
manufacturing company, with 1996 sales of $8.4 billion dollars from its three
primary business segments, fluid technology, automotive, and defense and
electronics. ITT Industries' automotive business is one of the world's
largest independent suppliers of systems and components to automotive
manufacturers. In the defense and electronics area, ITT Industries is a leader
in the design, manufacture and support of high technology electronic systems
and components for defense and commercial markets. In addition to the New
York Stock Exchange, ITT Industries' stock is traded under the symbol ("IIN")
on the Midwest, Pacific, London, Frankfurt and Paris exchanges.
SOURCE ITT Industries, Inc.
CONTACT: Thomas R. Martin, 914-641-2157, or Ralph Allen,
914-641-2030, both of ITT Industries