Polaris Industries Inc. (NYSE: PII) (“Polaris”) and WSI Industries,
Inc. (Nasdaq: WSCI) (“WSI Industries”) today jointly announced the
execution of a merger agreement by which Polaris will acquire all
outstanding common stock of WSI Industries for $7.00 per share in
cash, resulting in a WSI Industries enterprise value of
approximately $23.9 million. The merger, which is expected to close
in the fourth calendar quarter of 2018, is subject to customary
conditions including WSI shareholder approval.
WSI Industries reported net sales of $25.9
million for the first three quarters of its fiscal 2018 ending
August 26, 2018, of which 78% was attributable to sales to
Polaris.
“The WSI board is committed to maximizing
shareholder value and we believe this transaction will deliver
excellent value to our shareholders,” said Michael Pudil, WSI
Industries’ president and chief executive officer. “I am proud of
our achievements at WSI Industries. This transaction is testament
to the manufacturing excellence we have delivered to Polaris over
the last 20 years.”
Commenting on the acquisition, Ken Pucel,
executive vice president of Operations, Engineering & Lean at
Polaris, said: “WSI Industries has long been a key supplier of
Polaris. By bringing precision machining capability in-house, the
acquisition of WSI Industries supports our long-term supply chain
strategy and is an exciting value creation opportunity for Polaris.
We look forward to welcoming the WSI employees to the Polaris
team.”
Following the closing of the transaction,
Polaris will manage WSI Industries as a distinct operation
reporting into Pucel’s Global Operations organization and will
maintain its facility in Monticello, Minnesota.
Advisors
Lake Street Capital Markets, LLC acted as
financial advisor to WSI Industries and Ballard Spahr LLP acted as
legal advisor to WSI Industries. Faegre Baker Daniels LLP acted as
legal advisor to Polaris.
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About WSI Industries
WSI Industries, Inc. (Nasdaq: WSCI) is a leading
contract manufacturer that specializes in the machining of complex,
high-precision parts for a wide range of industries, including
automotive, avionics and aerospace, energy, recreational vehicles,
small engines, bioscience and the defense markets. Visit
www.wsiindustries.com for more information.
About Polaris
Polaris Industries Inc. (NYSE: PII) is a global
powersports leader that has been fueling the passion of riders,
workers and outdoor enthusiasts for more than 60 years. With annual
2017 sales of $5.4 billion, Polaris’ innovative, high-quality
product line-up includes the RANGER®, RZR® and Polaris GENERAL™
side-by-side off-road vehicles; the Sportsman® and Polaris ACE®
all-terrain off-road vehicles; Indian Motorcycle® midsize and
heavyweight motorcycles; Slingshot® moto-roadsters; snowmobiles;
and pontoon, deck and cruiser boats. Polaris enhances the riding
experience with parts, garments and accessories, along with a
growing aftermarket portfolio, including Transamerican Auto Parts.
Polaris’ presence in adjacent markets globally include military and
commercial off-road vehicles, quadricycles, and electric vehicles.
Proudly headquartered in Minnesota, Polaris serves more than 100
countries across the globe. Visit www.polaris.com for more
information.
Important Additional Information and Where to Find
It
This communication relates to the proposed
merger involving WSI Industries. In connection with the proposed
merger, WSI Industries plans to file with the Securities and
Exchange Commission (the “SEC”) preliminary and definitive proxy
statements and other relevant documents. This communication is not
a substitute for the proxy statement or any other document that WSI
Industries may file with the SEC or send to its shareholders in
connection with the proposed merger. Before making any
voting decision, shareholders of WSI Industries are urged to read
all relevant documents filed with the SEC, including the proxy
statement, when they become available because they will contain
important information about the proposed merger. Investors
and security holders will be able to obtain the proxy statement and
other documents filed by WSI Industries with the SEC (when
available) free of charge at the SEC’s website, www.sec.gov, or
from WSI Industries at the investor relations page of its website,
www.wsiindustries.com/investor-relations. These documents are not
currently available.
Participants in the Solicitation
WSI Industries and its directors and executive
officers may be deemed to be participants in the solicitation of
proxies from the holders of WSI Industries common stock in respect
of the proposed merger. Information about the directors and
executive officers of WSI Industries is set forth in WSI
Industries’ Annual Report on Form 10-K for the year ended August
27, 2017, filed with the SEC on November 3, 2017 and proxy
statement for its 2018 Annual Meeting of Shareholders, filed with
the SEC on November 11, 2017. Additional information regarding
potential participants in the proxy solicitation and a description
of their direct and indirect interests, by security holdings or
otherwise, will be contained in the proxy statement and other
relevant documents to be filed by WSI Industries with the SEC in
respect of the proposed merger.
Caution Regarding Forward Looking
Statements
This press release includes certain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are
based on current expectations and beliefs of WSI Industries
management and Polaris Industries management and are subject to
uncertainty and changes in circumstances. Actual results may vary
materially from those expressed or implied by the forward-looking
statements herein due to risks and uncertainties. These risks and
uncertainties include, but are not limited to, those associated
with: the parties’ ability to meet expectations regarding the
timing and completion of the merger; the occurrence of any event,
change or other circumstance that would give rise to the
termination of the merger agreement and the fact that certain
terminations of the merger agreement require WSI Industries to pay
a termination fee of $810,000; the failure to satisfy each of the
conditions to the consummation of the merger; the disruption of
management’s attention from ongoing business operations due to the
merger; the effect of the announcement of the merger on WSI
Industries’ relationships with its customers, particularly its
customers other than Polaris Industries, as well as its operating
results and business generally; the outcome of any legal
proceedings related to the merger; retention of employees of WSI
Industries following the announcement of the merger; and the fact
that WSI’s stock price may decline significantly if the merger is
not completed.
For a further list and description of the risks
and uncertainties affecting WSI Industries, see its filings with
the SEC, including those described under the heading “Risk Factors”
in Part I, Item 1A of its Annual Report on Form 10-K for the fiscal
year ended August 27, 2017.
For a further list and description of the risks
and uncertainties affecting Polaris Industries, see its filings
with the SEC, including those described under the heading “Risk
Factors” in Part I, Item 1A of its Annual Report on Form 10-K for
the fiscal year ended December 31, 2017.
The forward-looking statements speak only as of
the date such statements are made. Neither Polaris Industries nor
WSI Industries is under any obligation to, and each expressly
disclaim any obligation to, update or alter any forward-looking
statements, whether as a result of new information, future events,
changes in assumptions or otherwise, except as required by law.
Contacts
WSI Industries, Inc.
Michael J. Pudil (President & CEO) or Paul D. Sheely (CFO)
763-295-9202
Polaris Industries Inc.
Media Contact:
Jess Rogers, 763-513-3445
jessica.rogers@polaris.com
or
Investor Contact:
Richard Edwards, 763-513-3477
richard.edwards@polaris.com
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