Monday August 3, 7:55 am Eastern Time
Company Press Release
SOURCE: Pacific Aerospace & Electronics, Inc.
Pacific Aerospace & Electronics Acquires UK Aerospace Manufacturer
WENATCHEE, Wash., Aug. 3 /PRNewswire/ -- Pacific Aerospace & Electronics, Inc. (Nasdaq: PCTH; PCTHW),
announced today that it has completed its acquisition of UK aerospace manufacturer Aeromet International plc for UK 42
million pounds sterling, or approximately $69 million in cash. The acquisition closed on July 30, 1998.
Aeromet operates from five sites in England and is one of the UK's leading suppliers of magnesium and aluminum precision sand
and investment castings, and titanium and aluminum formed sheet products, for the aerospace, defense, and motorsport
industries in Europe. Aeromet had revenues of $49 million in its fiscal year ended December 31, 1997, while Pacific Aerospace
& Electronics had $54 million in revenues in its fiscal year ended May 31, 1998. After giving pro forma effect to the Aeromet
acquisition as if it had occurred on June 1, 1997, the Company's pro forma revenues for fiscal 1998 would have been $115.5
million. The combined company has backlog of approximately $110 million, of which $80 million is expected to be shipped to
customers in fiscal 1999.
''The Aeromet acquisition will significantly expand our customer base to nearly 600 accounts world wide,'' said Don Wright,
President and CEO of Pacific Aerospace & Electronics, Inc. ''Aeromet also adds to our already blue chip customer base new
customers such as British Aerospace, Rolls Royce, and Lucas Aerospace. After the acquisition, our largest customer, Boeing,
will represent about 13% of our consolidated revenue base.''
''We believe that, as a result of this acquisition, the Company is positioned to be a supplier, either directly or indirectly, to
nearly every major aerospace and defense electronics manufacturer in the world,'' said Wright. ''Aeromet's casting and forming
technologies and products are complementary extensions of our existing product lines. Its licensed Sophia casting process
expands our technology base of 32 patents and proprietary processes already owned by Pacific Aerospace & Electronics. We
believe that we will increase our ability to produce higher value systems incorporating products of both companies. We also
believe that we are well positioned to build on the combined strengths and manufacturing capabilities of Pacific Aerospace &
Electronics and Aeromet to enhance our competitive position, particularly in the consolidating aerospace and defense
electronics markets.''
Wright added: ''We are pleased that a strong and experienced Aeromet management team will continue to build Aeromet's
businesses. We look forward to working with Duncan Crighton, who will continue in his role as president of Aeromet. Mr.
Crighton has over 30 years experience in the aerospace industry in the United States and Europe, and we are honored to have
him join the Company's senior management team.''
Pacific Aerospace & Electronics financed the Aeromet acquisition through the issuance to qualified institutional buyers of $75
million of 11.25% Senior Subordinated Notes, which will become due in 2005. Interest is payable on the notes semiannually.
The financing transaction was managed by the investment banking firms of Friedman, Billings, Ramsey & Co., Inc. and
BancBoston Securities, Inc.
Pacific Aerospace & Electronics is a highly diversified manufacturing company that develops, manufactures and markets
high-performance electronics and metal components and assemblies for the aerospace, defense, electronics and transportation
industries. Prior to the Aeromet acquisition, the Company's primary businesses were organized in two operational and
marketing units. The Electronics Group develops, manufactures and sells a broad range of precision components, filtering
devices, electronic assemblies, and explosively bonded materials designed to operate with a high degree of reliability in harsh
environments such as the ocean, space and the human body. The Aerospace Group provides machined and cast aluminum and
metal parts and component assemblies for commercial and military aircraft, heavy trucking and automotive uses. Aeromet will
become a third operational group and will continue to provide magnesium and aluminum precision cast parts and formed
titanium and aluminum sheet products to the aerospace, defense and motorsport industries.
The Company's common stock trades on the Nasdaq National Market System under the symbol ''PCTH,'' and its warrants
trade under the symbol ''PCTHW.''
Forward-looking statements in this release concerning trends or anticipated operating results are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees
of future performance and are subject to risks and uncertainties related to the Company's operations. These risks and
uncertainties include, but are not limited to, competitive factors (including the possibility of increased competition or
technological development, competitors, and price pressures); legal factors (such as limited protection of the Company's
proprietary technology and changes in government regulation); and the Company's dependence on key personnel and significant
customers.
SOURCE: Pacific Aerospace & Electronics, Inc. |
