LIVONIA, Mich., March 1, 2019 /PRNewswire/ -- Tower
International, Inc. (NYSE: TOWR), a leading manufacturer of
engineered automotive structural metal components and assemblies,
today announced it has completed the sale of all of its European
Operations to Financière SNOP Dunois S.A.(FSD), a privately owned
French automotive supplier.
The purchase price represents an Enterprise Value of €255
million which represents an EV / Adjusted EBITDA multiple of 5.4x
2018 full year earnings.
"We are pleased to have completed the divestiture of Tower's
European operations at a valuation well above our current trading
multiple. The divestiture reduces Tower's net leverage to
less than 1 times Adjusted EBITDA, giving Tower the flexibility to
continue to profitably grow our business, maintain a conservative
balance sheet and continue to return of capital to our
shareholders," said CEO Jim Gouin.
"I would like to thank all of the colleagues from Tower
Europe for their great contributions to Tower International over
the years and wish them continued success as they become part of
FSD."
The divestiture resulted in net cash proceeds of approximately
$250 million after payment of
transaction costs and fees and the unwinding of the Euro
denominated swaps related to
Tower's Term Loan. Following the closure of the transaction,
Tower repaid $50 million of
outstanding Term Loan B indebtedness. This repayment, coupled
with Tower's voluntary reduction to the Term Loan in July 2018 represent repayments totaling
$100 million.
Gouin continued, "Since 2014, Tower's North American business
has grown by more than 40 percent in a relatively flat production
environment as we have benefitted from the industry's shift from
passenger cars to trucks and SUVs as well as OEM outsourcing.
Tower is well positioned to continue to benefit from these trends
and current projections for full-year 2020 represent continued
above market revenue growth, improved Adjusted EBITDA margins and
significant free cash flow."
Forward-Looking Statements and Risk Factors
This press release contains statements which constitute
forward-looking statements, within the meaning of the Private
Securities Litigation Reform Act of 1995, including but not limited
to statements regarding the completion of the sale transaction and
debt repayment described in this press release, the timing and
consequences of those transactions, projected enterprise value,
positioning, projected truck revenues and the outlook for revenue,
Adjusted EBITDA Margin, and net leverage. The forward-looking
statements can be identified by words such as "anticipate,"
"believe," "plan," "estimate," "expect," "intend," "project,"
"target," and other similar expressions. Forward-looking
statements are made as of the date of this presentation and are
based upon management's current expectations and beliefs concerning
future developments and their potential effects on us. Such
forward-looking statements are not guarantees of future
performance. The following important factors, as well as risk
factors described in our reports filed with the SEC, could cause
our actual results to differ materially from estimates or
expectations reflected in such forward-looking statements:
- global automobile production volumes;
- the financial condition of our customers and suppliers;
- our ability to make scheduled payments of principal or interest
on our indebtedness and comply with the covenants and restrictions
contained in the instruments governing our indebtedness;
- our ability to refinance our indebtedness;
- risks associated with our non-U.S. operations, including
foreign exchange risks and economic uncertainty in some
regions;
- any increase in the expense and funding requirements of our
pension and other postretirement benefits;
- our customers' ability to obtain equity and debt financing for
their businesses;
- our dependence on our largest customers;
- pricing pressure from our customers;
- changes to U.S. trade and tariff policies and the reaction of
other countries thereto;
- work stoppages or other labor issues affecting us or our
customers or suppliers;
- our ability to integrate acquired businesses;
- our ability to take advantage of emerging secular trends,
- risks associated with business divestitures; and
- costs or liabilities relating to environmental and safety
regulations.
We do not assume any obligation to update or revise the
forward-looking statements contained in this press release.
Contact:
Derek
Fiebig
Executive Director, Investor & External Relations
(248) 675-6457
fiebig.derek@towerinternational.com
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SOURCE Tower International