(PR NEWSWIRE) Lunn Industries, Inc. Merger With Technical Products Group, Inc
GLEN COVE, N.Y., Aug 21 /PRNewswire/ -- Lunn Industries, Inc. (Nasdaq: LUNN)
announced today that its Board of Directors has unanimously approved moving
forward with the stock-for-stock merger with TPG Holdings, Inc., which it had
announced in May. TPG is a private company primarily engaged in the business
of designing, developing and manufacturing advanced composite material
products for the aerospace and defense industries. The two companies had
entered into an Acquisition Agreement and Plan of Merger in June pursuant to
which it is contemplated that TPG will be merged with and into Lunn through
the exchange of each company's stock such that the Lunn stockholders would
retain approximately 26% of the combined entity on a fully diluted basis.
Based on the relative financial performance of Lunn and TPG during the first
six months of 1997, Lunn and TPG have agreed to amend the Merger Agreement to
provide that upon consummation of the merger, in addition to the issuance of
stock, there shall be issued to Lunn additional shares of the combined
company's stock in the event that TPG's 1997 net income is below a certain
threshold. The shares issuable as contingent stock consideration would
increase the currently contemplated 26% ownership by Lunn stockholders of the
combined company on an incremental basis based on how much TPG's 1997 net
income falls below the threshold. The contemplated merger still remains
subject to the approval of the Lunn and TPG stockholders, certain regulatory
approvals and a number of other customary conditions.
The following sets forth selected historical financial statements for TPG
and Lunn as well as the pro forma financial statements of the combined company
as if the merger had been effected January 1, 1996, for the 1997 second
quarter periods and the six months ended June 30, 1997.
Fiscal Quarter Ended
June 21 June 30 July 4 June 30
1996 1996 1997 1997
Hist. Hist. Comb. Hist. Hist. Comb.
TPG Lunn Profrma TPG Lunn Profrma
(In thousands)
Revenues $ 30,704 $ 4,642 $ 35,346$ 28,100 $ 5,705 $ 33,816
Gross Profit 7,576 962 8,838 6,906 1,356 8,262
Income from
Operations 2,906 308 3,148 2,213 542 2,688
Net income
(loss) $1,387 $201 $1,541 $1,049 $413 $1,321
Income (loss)
per share $2.89 0.02 $0.31 $2.10 $0.03 $0.24
Weighted average
shares
Outstanding 480,000 13,218,710 4,959,518 500,000 13,355,951 5,482,327
Six Months Ended
June 21 June 30 July 4 June 30
1996 1996 1997 1997
Hist. Hist. Comb. Hist. Hist. Comb.
TPG Lunn Profrma TPG Lunn ProFrma
(In thousands)
Revenues $ 57,752 $ 8,855 $66,607 $ 51,932 $ 10,726 $ 62,658
Gross Profit 14,296 1,912 16,208 11,992 2,487 14,479
Income from
Operations 4,508 518 4,928 2,372 858 3,132
Net income
(loss) $2,028 $295 $ 2,240 $853 $648 $1,227
Income (loss)
per share $4.25 $0.03 $0.45 $1.71 $0.05 $0.22
Weighted average
shares
Outstanding 477,250 9,012,769 4,953,788 500,000 13,285,299 5,482,327
As of As of
July 4,1997 June 30,1997
Historical Historical Combined
TPG Lunn Pro Forma
(In thousands)
Working Capital $ 18,059 $ 6,517 $ 23,376
Total Assets 46,101 21,269 72,270
Long-term liabilities 14,000 7,743 21,743
Redeemable 8% Cumulative Preferred
Stock 1,000 -- 1,000
Stockholders' Equity $7,871 $11,905 $23,476
The Board of Directors of Lunn believes that the merger with TPG will
enhance stockholder value over the long term as a result of a number of
factors, including the combined company's increased market capitalization
which may permit the combined company's common stock to be listed for trading
on the NASDAQ National Market System, its prospects for future growth, its
greater geographic scope and diversification of revenue sources.
Lunn Industries, Inc. and its wholly owned subsidiary, Alcore, Inc., are
diversified manufacturers of composite structures, bonded assemblies and
aluminum honeycomb for aerospace, transportation, construction, electronics
and defense industries.
/CONTACT Alan Baldwin, CEO of Lunn, 410-272-5230/
10:45 EDT
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