Guilford Mills, Inc. has entered into a definitive agreement for an affiliate of Cerberus Capital Management an investment firm based in New York, to acquire Guilford Mills in a cash tender offer.
The terms of the agreement provide that Cerberus will commence a tender offer to pay $19.00 per share in cash to all holders of shares outstanding for a total equity value of $107 million. The tender offer, which is not subject to a financing condition, is expected to commence within the next five business days and will remain open for at least twenty business days following the commencement of the offer.
The Board of Directors of Guilford Mills has approved the transaction. Consummation of the tender offer is conditioned upon matters customary in similar transactions. The parties expect the tender offer to be completed in the second calendar quarter of 2004. Following the completion of the tender offer, an affiliate of Cerberus will merge with and into Guilford Mills, with any shares not tendered to Cerberus being converted into the right to receive $19.00 per share in cash.
Stockholders holding, in the aggregate, approximately 48% of the outstanding shares of Guilford Mills have agreed, subject to certain conditions, to tender their shares to Cerberus in the tender offer.
Goldman Sachs & Co. acted as exclusive financial advisor to Guilford Mills, and Rothschild Inc. acted as exclusive financial advisor to Cerberus. Weil, Gotshal & Manges LLP served as outside counsel to Guilford Mills, and Schulte Roth & Zabel LLP served as outside counsel to Cerberus.
The proposed transaction comes less than eighteen months after Guilford Mills' emergence from bankruptcy.
Cerberus stated it was very excited to be able to acquire a global industry leader in automotive fabrics. Cerberus is looking forward to working with the current management team to create opportunities for future growth.
“I'm very excited to see Guilford placed in the hands of people who share our vision for building this company,” said John A. Emrich, the Company's President and Chief Executive Officer. “They believe in this company and our operations, and they fully support our plans for growth.”
Emrich said, “It took exceptional effort from many people to get us to this point. Much credit goes to our current stockholders, who demonstrated their confidence in our team and our direction, our customers, our suppliers, and our 2,600 associates, who performed incredibly well in a very challenging business environment.”
Cerberus Capital Management, L.P. and its affiliated entities manage funds and accounts with capital in excess of $12 billion.