- Accuride to be Acquired by Crestview
Partners for $2.58 Per Share
- The Accuride Board of Directors
Recommends Shareholders Vote “FOR” the Transaction
Accuride Corporation (NYSE:ACW) (“Accuride” or the “Company”) –
a leading supplier of components to the North American and European
commercial vehicle industries – today announced that it has filed
its definitive proxy materials with the U.S. Securities and
Exchange Commission in connection with the Company’s Special
Meeting of Shareholders (the “Special Meeting”) to vote on the
transaction with affiliates of Crestview Partners
(“Crestview”).
The Special Meeting is scheduled for November 15, 2016.
Shareholders of record as of October 10, 2016 will be entitled to
vote at the Special Meeting.
As previously announced on September 2, 2016, Accuride signed a
definitive agreement to be acquired by affiliates of Crestview, a
leading private equity firm, for $2.58 per share in cash. The
Accuride Board of Directors unanimously recommends that
shareholders vote “FOR” the proposed merger on the proxy card
today.
In connection with the filing and mailing of its definitive
proxy statement, Accuride is mailing a letter to shareholders
detailing the value of the Crestview transaction for shareholders.
In its letter, Accuride highlights that:
- Accuride shareholders will receive a
substantial premium and immediate and certain cash value for their
shares;
- The Crestview transaction is the
outcome of a lengthy, thorough and comprehensive strategic
alternatives review; and
- The Crestview transaction eliminates
standalone risk during a period of ongoing challenges in the North
American commercial vehicle industry.
The full text of the letter follows:
YOUR VOTE REQUIRED:ACCURIDE TO BE
ACQUIRED BY CRESTVIEW PARTNERS FOR $2.58 PER SHARE
THE ACCURIDE BOARD OF DIRECTORS RECOMMENDS
SHAREHOLDERSVOTE FOR THE
TRANSACTION TODAY
SPECIAL MEETING TO BE
HELD ON NOVEMBER 15, 2016
October 17, 2016
Dear Accuride shareholders,
As you know, on September 2, 2016, Accuride Corporation
(“Accuride” or the “Company”) announced it had signed a definitive
agreement to be acquired by affiliates of Crestview Partners
(“Crestview”), a leading private equity firm, for $2.58 per share
in cash.
Having conducted a lengthy and thorough process to evaluate
strategic alternatives reasonably available for the Company, the
Accuride Board of Directors unanimously determined that the
Crestview proposal offered certain, compelling and immediate value
to our shareholders.
You are asked to vote to APPROVE this value-creating transaction
on November 15, 2016. Your Board unanimously recommends a vote
“FOR” the proposed merger on the enclosed proxy card today.
ACCURIDE SHAREHOLDERS RECEIVE A SUBSTANTIAL
PREMIUM ANDIMMEDIATE AND CERTAIN CASH VALUE FOR THEIR
SHARES
In an otherwise challenging operating environment, Accuride is
pleased to present to its shareholders an opportunity to exchange
their shares for certain cash value:
- The $2.58 per share all-cash offer
represents an 86% premium to the 90-day average
volume weighted average price over Accuride’s closing stock price
on September 1, 2016.
- As recently as February 2016, Accuride
stock traded at $0.77 per share, which comparatively represents a
premium of 233%.
THE CRESTVIEW TRANSACTION IS THE OUTCOME OF
ATHOROUGH AND COMPREHENSIVE STRATEGIC ALTERNATIVES
REVIEW
Prior to reaching an agreement with Crestview, your Board ran a
lengthy and thorough strategic alternatives review process, during
which it engaged in discussions with multiple strategic and
financial parties and evaluated opportunities to refinance
Accuride’s $310 million in outstanding high-interest debt that
matures in August 2018.
After considering the available alternatives to Crestview’s
offer, as well as the opportunities and challenges associated with
refinancing the Company’s outstanding debt and proceeding as a
standalone business, your Board unanimously concluded that the
proposed transaction with Crestview is in the best interests of
Accuride shareholders.
In reaching the agreement with Crestview, and in line with its
commitment to maximizing value, the Accuride Board negotiated a
35-day “go shop” period to solicit alternative proposals. During
this period, the Board, with the assistance of its financial
advisor, solicited alternative proposals from 59 potential
acquirers, including Coliseum Capital Management. However, no
alternative proposal was received.
THE CRESTVIEW TRANSACTION ELIMINATES
STANDALONE RISK DURING A PERIOD OF ONGOING CHALLENGES FOR THE
INDUSTRY
This is a particularly challenging time in the highly cyclical
North American commercial vehicle industry, and Accuride’s
financial performance in recent periods unfortunately has been
influenced by these industry dynamics, despite continued strong
operational execution. Indeed, the most important end markets for
Accuride’s products are facing ongoing challenges.
- The Class 8 truck cycle trough has
proved to be deeper and more difficult than industry forecasts had
previously suggested:
- Class 8 vehicle production forecasts
continue to be revised downward;
- ACT Research’s October 2016 North
America Commercial Vehicle Outlook forecasts that Class 8 vehicle
production in 2016 will be 30% below 2015 levels; and
- The timing and strength of an upturn in
the Class 8 market remains unclear, and management believes that
this challenging market environment will continue into 2017.
- The commercial vehicle trailer market
appears to be starting its cyclical decline off of sustained
multi-year highs, and could be headed for a sustained trough as
transportation companies have substantially replaced their trailer
fleets.
Competitive dynamics in the marketplace are compounding these
demand challenges, as low-cost country-sourced wheel and wheel-end
products continue to pressure our share and profitability in
certain products and end-markets.
While your Board and leadership team are working hard to remain
nimble in the face of these challenges by further reducing costs
and driving efficiencies, managing through the downturn while
refinancing the Company’s debt would involve substantial risks and
would be difficult and costly to execute. Refinancing the debt
capital structure on terms less attractive than current terms would
significantly impair cash flow generation. As well, Accuride has
currently and would continue to have very limited capital available
to pursue growth initiatives.
The Board believes that Accuride would require a substantial
equity investment to both refinance our capital structure on
sustainable terms with lower leverage and to execute against a
standalone plan. In the current public company context, any
substantial equity investment is likely to be highly dilutive to
non-participating shareholders and may result in a sale of control
(or effective control) of the Company without the payment of an
appropriate control premium. Moreover, given the current challenges
faced by the Company in light of the highly cyclical North American
commercial vehicle industry, it may be difficult to complete such
an equity investment in a timely manner, or at all, and this could
have a significant negative impact on the ability to refinance the
Company’s debt.
Your Board and leadership team have worked diligently over the
past years to create a strong, enduring business platform at
Accuride. The steep downturn in the Class 8 market (and earlier the
oil & gas end markets impacting the recently divested Brillion
division) has unfortunately put a significant strain on our capital
structure and standalone business plan. Notwithstanding these
ongoing challenges, we secured the proposed acquisition offer at a
substantial premium which compensates our shareholders for the
long-term value of Accuride, including its value as a business
platform and its growth opportunities.
VOTE “FOR” THE
PROPOSED MERGER TODAY
Our proposed acquisition by Crestview provides Accuride
shareholders with a substantial premium and immediate and certain
cash value for their shares and eliminates the significant business
and capital structure risks associated with executing against a
standalone plan.
Your Board believes the proposed Crestview acquisition maximizes
the value of your investment and unanimously recommends that you vote to
approve it. Failing to vote has the same effect as a vote against
the transaction. Your vote is important, no
matter how many shares you own. Shareholders may vote by
following the instructions on the enclosed proxy card, or, if your
shares are held in ‘‘street name’’ through a broker, bank or
nominee, by instructing your broker, bank or nominee on how to vote
your shares using the voting instruction form furnished by your
broker, bank or nominee.
Please take a moment to vote “FOR” the merger with Crestview TODAY by signing and returning the enclosed
proxy card in the postage-paid envelope provided, or, if your
shares are held in ‘‘street name’’ through a broker, bank or
nominee, by instructing your broker, bank or nominee on how to vote
your shares using the voting instruction form furnished by your
broker, bank or nominee.
Thank you for your support.
Sincerely,
John W. RisnerChairman
Richard F. DauchPresident and Chief Executive Officer
If you have questions or need assistance
voting your shares please contact:
Georgeson LLC1290 Avenue of the
Americas, 9th FloorNew York, NY 10104
Stockholders call toll-free: (800) 676-0281
About Accuride Corporation
With headquarters in Evansville, Ind., USA, Accuride Corporation
is a leading supplier of components to the North American and
European commercial vehicle industries. The company’s products
include commercial vehicle wheels and wheel-end components and
assemblies. The company’s products are marketed under its brand
names, which include Accuride®, Accuride Wheel End Solutions™,
Gunite® and Gianetti Ruote™. Accuride’s common stock trades on the
New York Stock Exchange under the ticker symbol ACW. For more
information: www.AccurideCorp.com.
Additional Information About the Acquisition and Where to
Find It
Accuride filed a definitive proxy statement and related
materials with the Securities and Exchange Commission (“SEC”) on
October 17, 2016 for its special meeting of shareholders in
connection with the proposed merger contemplated by the Agreement
and Plan of Merger, dated September 2, 2016, by and among the
Company, Armor Parent Corp. and Armor Merger Sub Corp. (such
merger, the “proposed transaction” and such agreement, the “Merger
Agreement”). The definitive proxy statement will be mailed to
shareholders of Accuride on or about October 17, 2016. The
definitive proxy statement contains important information about the
proposed transaction and related matters. INVESTORS OF ACCURIDE ARE
URGED TO READ THE DEFINITIVE PROXY STATEMENT AND OTHER RELEVANT
MATERIALS CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN
IMPORTANT INFORMATION ABOUT ACCURIDE, ARMOR PARENT CORP., ARMOR
MERGER SUB CORP. AND THE PROPOSED TRANSACTION. Investors may obtain
a free copy of these materials and other documents filed by
Accuride with the SEC at the SEC’s website at www.sec.gov, at
Accuride’s website at www.accuridecorp.com or by sending
a written request to Accuride at 7140 Office Circle, Evansville,
Indiana 47715, Attention: General Counsel and Corporate
Secretary.
Participants in the Solicitation
Accuride and its directors, executive officers and certain other
members of management and employees may be deemed to be
participants in soliciting proxies from its shareholders in
connection with the proposed transaction. Information regarding the
persons who may, under the rules of the SEC, be considered to be
participants in the solicitation of Accuride’s shareholders in
connection with the proposed transaction is set forth in Accuride’s
definitive proxy statement for its special shareholder meeting,
which was filed on October 17, 2016. Additional information
regarding these individuals and any direct or indirect interests
they may have in the proposed transaction is set forth in the
definitive proxy statement. Information relating to the foregoing
can also be found in Accuride’s definitive proxy statement for its
2016 Annual Meeting of Shareholders (the “2016 Proxy Statement”),
which was filed with the SEC on March 18, 2016. To the extent that
holdings of Accuride’s securities have changed since the amounts
set forth in the 2016 Proxy Statement, such changes have been or
will be reflected on Statements of Change in Ownership on Form 4
filed with the SEC.
Forward-Looking Statements
Certain statements contained in this document may be considered
forward-looking statements within the meaning of the U.S.
securities laws, including Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, including statements regarding the proposed
transaction and the ability to consummate the proposed transaction.
These forward-looking statements generally include statements that
are predictive in nature and depend upon or refer to future events
or conditions, and include words such as “believes,” “plans,”
“anticipates,” “projects,” “estimates,” “expects,” “intends,”
“strategy,” “future,” “opportunity,” “may,” “will,” “should,”
“could,” “potential,” or similar expressions. Statements that are
not historical facts are forward-looking statements.
Forward-looking statements are based on current beliefs and
assumptions that are subject to risks and uncertainties. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date they are made. Actual
results could differ materially from those contained in any
forward-looking statement as a result of various factors,
including, without limitation: (1) Accuride may be unable to obtain
shareholder approval for the proposed transaction; (2) the
conditions to the closing of the proposed transaction may not be
satisfied and required regulatory approvals may not be obtained;
(3) the proposed transaction may involve unexpected costs,
liabilities or delays; (4) the business of Accuride may suffer as a
result of uncertainty surrounding the proposed transaction; (5) the
outcome of any legal proceedings related to the proposed
transaction; (6) Accuride may be adversely affected by other
economic, business, legislative, regulatory and/or competitive
factors; (7) the occurrence of any event, change or other
circumstances that could give rise to the termination of the Merger
Agreement; (8) risks that the proposed transaction disrupts current
plans and operations and the potential difficulties in employee
retention as a result of the proposed transaction; (9) the failure
by Armor Parent Corp. or Armor Merger Sub Corp. to obtain the
necessary debt and equity financing arrangements set forth in the
commitment letters received in connection with the proposed
transaction; and (10) other risks to consummation of the proposed
transaction, including the risk that the proposed transaction will
not be consummated within the expected time period or at all. If
the proposed transaction is consummated, Accuride’s shareholders
will cease to have any equity interest in Accuride and will have no
right to participate in its earnings and future growth. The
foregoing review of important factors that could cause actual
results to differ from expectations should not be construed as
exhaustive and should be read in conjunction with statements that
are included herein and elsewhere, including Accuride’s filings
with the SEC, including its Annual Report on Form 10-K for the year
ended December 31, 2015 and recent Quarterly Reports on Form 10-Q
and Current Reports on Form 8-K filed with the SEC, which are
available on the SEC’s website at www.sec.gov. Except as
required by applicable law, Accuride undertakes no obligation to
update any forward-looking statement, or to make any other
forward-looking statements, whether as a result of new information,
future events or otherwise. Accuride does not intend, and assumes
no obligation, to update any forward-looking statements. Accuride’s
filings with the SEC, including its Annual Report on Form 10-K for
the year ended December 31, 2015, the 2016 Proxy Statement and
recent Quarterly Reports on Form 10-Q and Current Reports on Form
8-K filed with the SEC, which are available on the SEC’s website
at www.sec.gov
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version on businesswire.com: http://www.businesswire.com/news/home/20161017005589/en/
ACCURIDEMEDIA RELATIONSTimothy G. Weir,
APR, 812-962-5128Director of Public Affairs, Communications
& Marketingtweir@accuridecorp.comorINVESTOR
RELATIONSTodd Taylor, 812-962-5105Vice President and
Treasurerttaylor@accuridecorp.comorJOELE FRANK, WILKINSON
BRIMMER KATCHERDan Katcher, Jim Golden or Priscila
Roney212-355-4449
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