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Please find below all Forbo media releases listed by year.
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UNITED STATES, CANADA, JAPAN OR AUSTRALIA
Eglisau/Zurich, November 11, 2004
Forbo wants to manage the three businesses of adhesives, belting, and flooring as independent and focused operative entities under the umbrella of a strategy and finance holding. The announced equity capital increase of CHF 200 million will enable the Group to exploit its value adding potential. The capital increase has to be seen in the light of the resolution to restructure and sustainably enhance the flooring business within the Group. The adhesives business shall grow in market segments with premium products. The focus in the belting business lies on the fast conclusion of the turnaround. Furthermore, the Board of Directors announces that in the last few days the private equity house CVC Capital Partners has expressed its interest in acquiring all outstanding shares of Forbo at a purchase price of CHF 330 per share, subject to a due diligence review of the company.
Funds for restructuring and growth dynamics
With these steps, Forbo aims at a sustainable improvement of the operative result. Returns are expected to pick up in 2006, with the full effect being felt as from 2007.
The restructuring costs and extraordinary depreciation charges for the three businesses will amount to approximately CHF 200 million in total. About CHF 60 million of that amount will be cash effective. It is expected that in excess of two thirds of the charges will be incurred in the current fiscal year.
Approximately CHF 200 million shall be invested in selective external growth opportunities in high-margin segments, mainly in the adhesives business. In addition, the capital increase will significantly reduce net debt and increase the Group’s financial flexibility. The impact of restructuring and special charges on the shareholder’s equity will be offset by the capital increase. Thus, the equity amount will more or less stay at the current level. The US Debt Private Placement remains unchanged.
Measures initiated in all the three businesses*
The adhesives business will be strengthened in order to further exploit the potential from the Swift acquisition as well as to accelerate growth. This includes the entry into new markets, especially in Eastern Europe and in Asia, and the development of market segments with premium products. Selective acquisitions shall support growth.
In the belting business the turnaround needs to be completed and the market positions strengthened. The main objectives are the clear improvement of operating efficiency and the exploitation of the potential of higher-value, higher-margin products.
An analysis of the flooring business has shown that restructuring the business within the Group compared to divestiture offers an interesting potential for adding value for shareholders. Sustainable value added shall be achieved through the adjustment of production capacities, restructuring of the product portfolio, higher efficiency in production, marketing, sales and administration, and the expansion of the commercial business. At the same time new markets shall be opened up and selective growth shall be supported with the targeted strengthening of the presence in Eastern Europe and Asia, the expansion of the product range, and smaller acquisitions.
Extraordinary General Meeting on December 2, 2004
The capital increase by CHF 200 million will be submitted for approval to the shareholders at the Extraordinary General Meeting on December 2, 2004. The invitation is sent out today. It is published on www.forbo.com. The subscription price will be announced on December 2, 2004. Lead Manager of the transaction is Credit Suisse First Boston.
Interest by Private Equity House
Furthermore, the Board of Directors announces that in the last few days the private equity house CVC Capital Partners has expressed its interest in acquiring all outstanding shares of Forbo at a purchase price of CHF 330 per share, subject to a due diligence review of the company. To the Board of Directors, this may be proof of Forbo’s potential that has always been the basis of its corporate strategy and the starting point of the planned equity capital increase. Following an initial analysis, the Board of Directors has concluded that under its leadership more value can be generated for shareholders in the long term. For an assessment of its conclusion, the Board of Directors has commissioned Credit Suisse First Boston to prepare a value analysis. As the Chairman of Forbo’s Board of Directors is also a member of CVC’s Advisory Board, he stepped aside for this particular matter although he was not informed by CVC on the purchase offer; this business is being handled by his designated successor.
Three businesses under a single holding
Forbo combines leading producers and suppliers of adhesives, belting and flooring under a single holding. The products and services are well established and recognized all over the world. In the adhesives business, high-performance products ensure stable and permanent bonding of a broad variety of materials. In the belting business, products are manufactured and distributed under the „Siegling“ brand for transport, process and drive applications. In the flooring business, the company focuses on environmentally friendly and design-oriented linoleum, high-quality vinyls, and parquet floorings.
The Forbo Group with Head Office in Eglisau, Switzerland, has about 5’600 employees. The holding company, Forbo Holding AG, is listed at the SWX Swiss Exchange (securities number 354'151, Bloomberg FORN SW, Reuters FORZn S). You will find more information under www.forbo.com.
The purpose of this publication is to inform Forbo Holding shareholders and the public. It contains information on the planned capital increases and related resolutions to be adopted by the extraordinary shareholders meeting of 2 December 2004. This press release does not constitute an offer to buy or to subscribe for shares or other securities of Forbo Holding and it does not constitute an offering circular within the meaning of Art. 652a of the Swiss Code of Obligations or a listing prospectus within the meaning of the listing rules of SWX Swiss Exchange. Should Forbo Holding make in the future one or more capital increases Investors should take their decision to buy or to subscribe to new shares or other securities solely based on the relevant offering circular. Investors are furthermore advised to consult their bank or financial adviser.
This publication contains specific forward-looking statements, e.g., statements including terms like "believe", "assume", "expect" or similar expressions. Such forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may result in a substantial divergence between the actual results, financial situation, development or performance of the company and those explicitly or implicitly presumed in these statements. Against the back-ground of these uncertainties readers should not rely on forward-looking statements. The company assumes no responsibility to update forward-looking statements or to adapt them to future events or developments.
This material is not for distribution, directly or indirectly, in or into the United States.
This release is not an offer to subscribe for or purchase securities in Forbo Holding, whether in the United States or elsewhere. The securities of Forbo Holding may not be offered or sold in the United States, unless they are registered or exempt from registration. There will be no public offer of securities in the United States.
Prices and values of, and income from, securities may go down as well as up and an investor may not get back the amount invested. It should be noted that past performance is no guide to future performance.
This E. Schneider
Delegate of the Board and CEO
Tel +41 1 868 25 49
Fax +41 1 868 35 49
Chief Financial Officer
Tel +41 1 868 25 56
Fax +41 1 868 35 56