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INVENSYS SELLS ENERGY STORAGE FOR $505 MILLION
07 January 2002 - Invensys plc
| Invensys plc, ('Invensys') announces today the sale of its Energy Storage Group ('ESG') to EnerSys, Inc. ('EnerSys') for a cash consideration of $505 million. In addition, Invensys will be issued warrants that, if exercised, may give Invensys up to a 28% equity stake in the enlarged company. EnerSys, an industrial batteries supplier, is a private company controlled by Morgan Stanley Capital Partners IV, L.P. ('MSCP'). The transaction incorporates an agreement governing the ongoing supply of batteries by the enlarged EnerSys to Invensys. Completion is subject to regulatory approval, in particular in US, France (see below) and China, and the receipt of financing by EnerSys, and is currently expected to be in March 2002. |
Invensys plc, ('Invensys') announces today the sale of its Energy Storage Group ('ESG') to EnerSys, Inc. ('EnerSys') for a cash consideration of $505 million. In addition, Invensys will be issued warrants that, if exercised, may give Invensys up to a 28% equity stake in the enlarged company. EnerSys, an industrial batteries supplier, is a private company controlled by Morgan Stanley Capital Partners IV, L.P. ('MSCP'). The transaction incorporates an agreement governing the ongoing supply of batteries by the enlarged EnerSys to Invensys. Completion is subject to regulatory approval, in particular in US, France (see below) and China, and the receipt of financing by EnerSys, and is currently expected to be in March 2002. Rick Haythornthwaite, CEO of Invensys said:'This significant transaction continues the Board's focus on reducing the level of indebtedness of Invensys through the disposal of non-core assets. It will also create a more focused Power Systems division that is better positioned to serve its customers in partnership with an industry leading batteries supplier. The supply agreement ensures supply of top quality components for our Power Systems division and will continue to enable the synergies between ESG and the Power Systems division to be realised. The warrants give our shareholders the opportunity to benefit from the value creation that the enlarged EnerSys has the potential to achieve. We are pleased with the terms of this transaction, which has been achieved in a challenging environment for corporate transactions and many of the sectors that ESG supplies.' John D. Craig, CEO of EnerSys, said: 'This acquisition significantly enhances the strategic positioning and scale of EnerSys. The enlarged EnerSys, combining the US strength of EnerSys and the European based ESG, will result in the world's largest industrial battery company. The expanded product portfolio, which includes leading brands such as Hawker, Exide, General and Powersafe will offer customers the widest product selection from any one manufacturer. The combined worldwide manufacturing and distribution network will position the company to serve our global customer base and offer exciting opportunities for our employees'. ESG is expected, for the period ending 31 March 2002, to achieve sales of approximately $600m (£415m) and profits before restructuring, interest and tax of around $60m (£41m). Net operating assets, which are expected to be the subject of the transaction, are approximately $435m (£300m) - excluding £277m goodwill already written off to reserves. The cash proceeds will be used to reduce debt. In order to comply with the relevant French legal requirements, no binding agreement has been entered into in relation to including the sale of the French ESG business in the transaction, and no such agreement will exist until and unless the information/consultation process of the council of workers has been complied with in accordance with French law. ESG
ESG is a leading supplier of standby and motive batteries and battery chargers. Standby batteries supply backup power, typically in conjunction with an uninterruptible power supply, in the event of power disturbances and are supplied primarily to the telecommunication and information technology sectors. Motive power batteries provide power for industrial equipment such as forklift trucks. ESG has 15 manufacturing facilities worldwide in 9 countries and approximately 5,000 employees. EnerSys
EnerSys is a leader in stored energy solutions. The company maintains its worldwide headquarters, research, development and engineering facilities in Reading, Pennsylvania. EnerSys operates manufacturing facilities in the United States, Argentina, Brazil and Mexico, plus assembly operations in Canada, and has 2,500 employees. The company was formed through the acquisition of the Industrial Products Group of Yuasa Corp. by Morgan Stanley Capital Partners and the management team of EnerSys in November 2000. Morgan Stanley Capital Partners
Morgan Stanley Capital Partners is the main fund of Morgan Stanley Private Equity, the private equity business of Morgan Stanley & Co. (NYSE:MWD). Since its founding 17 years ago, Morgan Stanley Private Equity's funds have invested capital across a broad range of industries including telecommunications, technology, financial services, healthcare and basic industry. Morgan Stanley Private Equity's funds consist of Capital Partners, Venture Partners and Emerging Markets.
http://www.invensys.com
About: Invensys plc
Invensys is a global automation, controls and process solutions Group. We empower you to increase productivity, reduce waste, remove cost from your supply chain, boost profitability and demonstrate measurable improvement in your company's overall performance.
As a global leader in resource productivity, Invensys offers products and services, expertise, and technologies that enable you to maximize return on investments, conserve resources and optimize performance across your value chain.Operating in more than 60 countries worldwide, Invensys meets the needs of the process and batch industries - from oil & gas, powerand utilities, chemicals, and rail systems to food & beverage, healthcare, and data communications - as well as the discrete and hybrid manufacturing sectors, and provides components, systems and services to the heating management, commercial refrigeration, residential safety and automotive industries, and electronic and electro-mechanical systems and components to appliance and related industries. Not only do we help improve your bottom line, by enabling you to manage your assets more efficiently, but we also help you to protect the environment. As the result of our efforts, we have been awarded the prestigious Energy Star Label by the United States Environmental Protection Agency (EPA). Taking an integrated strategic approach to increasing your productivity, we enable you to increase output from your existing plants and technology investments, provide you with solutions that create more efficiencies in your supply chain, and increase performance at every level. From the production line to executive offices, from customer relationship and procurement management to distribution logistics, we can help you improve productivity, optimize performance, and increase profitability. |
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