KEMET Completes Acquisition of NEC TOKIN
April 19 2017 - 8:30AM
KEMET Corporation (the “Company” or “KEMET”) (NYSE:KEM), a leading
global supplier of passive electronic components, announced today
that it has completed the acquisition, through its wholly owned
subsidiary, KEMET Electronics Corporation (“KEC”), of NEC TOKIN
Corporation (“NEC TOKIN”).
The acquisition of NEC TOKIN was completed pursuant to the
previously announced February 23, 2017 Definitive NEC TOKIN Stock
Purchase Agreement (the “Agreement’) between KEC and NEC
Corporation (“NEC”). Pursuant to the Agreement, KEC paid NEC JPY
16.2 billion, or approximately $149.2 million, for all of the
outstanding shares of NEC TOKIN it does not already own. The
purchase price was comprised of JPY 6.0 billion (approximately
$55.3 million) plus one-half of an amount determined to be the
excess net cash proceeds from the announced sale of NEC TOKIN’s
electro-mechanical devices (“EMD”) business, after the repayment of
outstanding indebtedness of NEC TOKIN and after the payment of
taxes, fees and expenses relating to the sale of the EMD business.
The excess cash calculation is subject to working capital
adjustments pursuant to a master sale and purchase agreement for
the EMD business. Effective as of today, NEC TOKIN has changed its
name to TOKIN Corporation (“TOKIN”).
“We look forward to shaping our future together with TOKIN,”
stated Per Loof, the Company’s Chief Executive Officer. “This
begins a new transformative chapter for both KEMET and TOKIN. It is
an exciting time for all our stakeholders: customers, investors
and, indeed, our employees. We look forward to addressing together
the opportunities and challenges of developing and designing the
next level of technologies that will enable us to exceed the future
demands of our customers driven by the global electronic industry,”
continued Loof.
As previously announced, based on current estimates, after all
payments to NEC (and net of taxes, fees and expenses), the
acquisition effectively results in a net cash inflow to the
Company, on a consolidated basis, of approximately $38.6 million
and 100% ownership of the shares of NEC TOKIN. KEMET’s consolidated
combined cash on the balance sheet (including TOKIN Corporation),
post-closing, is approximately $269.1 million.
For details of the Agreement, please refer to the Company’s Form
8-K filed on February 23, 2017.
About KEMET
The Company's common stock is listed on the NYSE under the
ticker symbol "KEM" (NYSE:KEM). At the Investor Relations
section of our web site at http://www.kemet.com/IR, users may
subscribe to KEMET news releases and find additional information
about our Company. KEMET offers our customers the broadest
selection of capacitor technologies in the industry, along with an
expanding range of electromechanical devices, electromagnetic
compatibility solutions and supercapacitors. Our vision is to
be the preferred supplier of electronic component solutions
demanding the highest standards of quality, delivery and service.
Additional information about KEMET can be found at
http://www.kemet.com.
CAUTIONARY STATEMENT ON FORWARD-LOOKING
STATEMENTS
Certain statements included herein contain forward-looking
statements within the meaning of federal securities laws, including
the estimate of net cash inflow to the Company, on a consolidated
basis. These forward-looking statements are based on management’s
current expectations, estimates, beliefs and assumptions. Words
such as “expects,” “anticipates,” “believes,” “estimates,”
variations of such words and other similar expressions are intended
to identify such forward-looking statements. These statements are
not guarantees of future performance and involve certain risks,
uncertainties and assumptions, which are difficult to predict.
Therefore, actual outcomes and results may differ materially from
what is expressed or forecasted in, or implied by, such
forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect
management’s judgment only as of the date hereof. The Company
undertakes no obligation to update publicly any of these
forward-looking statements to reflect new information, future
events or otherwise.
Factors that may cause actual outcome and results to differ
materially from those expressed in, or implied by, these
forward-looking statements include, but are not necessarily limited
to the following:(i) adverse economic conditions could impact our
ability to realize operating plans if the demand for our products
declines, and such conditions could adversely affect our liquidity
and ability to continue to operate; (ii) continued net losses could
impact our ability to realize current operating plans and could
materially adversely affect our liquidity and our ability to
continue to operate; (iii) adverse economic conditions could cause
the write down of long-lived assets or goodwill; (iv) an increase
in the cost or a decrease in the availability of our principal or
single-sourced purchased raw materials; (v) changes in the
competitive environment; (vi) uncertainty of the timing of customer
product qualifications in heavily regulated industries; (vii)
economic, political, or regulatory changes in the countries in
which we operate; (viii) difficulties, delays or unexpected costs
in completing the restructuring plans; (ix) equity method
investment in NEC TOKIN exposes us to a variety of risks; (x)
acquisitions and other strategic transactions expose us to a
variety of risks; (xi) the acquisition of NEC TOKIN may
not achieve all of the anticipated results (xii) our business could
be negatively impacted by increased regulatory scrutiny and
litigation; (xiii) the inability to attract, train and retain
effective employees and management; (xiv) the inability to develop
innovative products to maintain customer relationships and offset
potential price erosion in older products; (xv) exposure to claims
alleging product defects; (xvi) the impact of laws and regulations
that apply to our business, including those relating to
environmental matters; (xvii) the impact of international laws
relating to trade, export controls and foreign corrupt practices;
(xviii) changes impacting international trade and corporate tax
provisions related to the global manufacturing and sales of our
products may have an adverse effect on our financial condition and
results of operations; (xix) volatility of financial and credit
markets affecting our access to capital; (xx) the need to reduce
the total costs of our products to remain competitive; (xxi)
potential limitation on the use of net operating losses to offset
possible future taxable income; (xxii) restrictions in our debt
agreements that limit our flexibility in operating our business;
(xxiii) failure of our information technology systems to function
properly or our failure to control unauthorized access to our
systems may cause business disruptions; (xxiv) additional exercise
of the warrant by K Equity, LLC which could potentially result in
the existence of a significant stockholder who could seek to
influence our corporate decisions; and (xxv) fluctuation in
distributor sales could adversely affect our results of
operations.
Contact:
William M. Lowe, Jr.
Executive Vice President and
Chief Financial Officer
williamlowe@kemet.com
864-963-6484
Richard J. Vatinelle
Vice President and
Treasurer
richardvatinelle@kemet.com
954-766-2838
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