ElkCorp Amends Merger Agreement with The Carlyle Group
23 January 2007 - 12:38AM
Business Wire
ElkCorp (NYSE:ELK), a leading manufacturer of roofing and building
products, today announced that The Carlyle Group (Carlyle) has
agreed to increase its tender offer to acquire all of the
outstanding shares of ElkCorp common stock to $42.00 per share in
cash, up from the previous offer of $40.50 per share, which was
announced on January 16, 2007. ElkCorp and Carlyle amended their
previously announced merger agreement to reflect this increased
price. Carlyle�s tender offer, which commenced on January 18, 2007,
will expire at midnight on February 14, 2007, unless extended in
accordance with the terms of the merger agreement and the
applicable rules and regulations of the Securities and Exchange
Commission (SEC). As previously announced, following completion of
the tender offer in which a majority of ElkCorp�s outstanding
shares are tendered, Carlyle has committed to complete a
second-step merger in which all remaining shares of ElkCorp common
stock will be converted into the right to receive the same price
paid per share in the tender offer. Carlyle has obtained fully
committed financing for the tender offer and the second-step
merger. Upon the recommendation of a special committee of ElkCorp�s
Board consisting solely of independent, non-management directors,
ElkCorp�s Board has approved the revised merger agreement and
recommends that shareholders tender their shares into the Carlyle
offer. As previously disclosed, on January 18, 2007 an affiliate of
Building Materials Corporation of America (BMCA) had commenced a
cash tender offer to purchase all of ElkCorp�s shares at $42.00 per
share. Carlyle�s tender offer of $42.00 values the Company at
approximately $1.1 billion, including the assumption of
approximately $173 million of net debt. The revised per share price
represents a premium of approximately 67% over ElkCorp�s closing
share price on November 3, 2006, the last trading day before
ElkCorp announced that its Board of Directors and management were
conducting a review of the company�s strategic alternatives. The
tender offer is subject to a majority of ElkCorp�s outstanding
shares being tendered into the offer and other customary closing
conditions. The transaction is not subject to any financing
condition and Carlyle has obtained fully committed financing for
both the tender offer and the second-step merger. The transaction
will be financed through a combination of equity and debt
financing, with the debt financing committed by Bank of America,
N.A., Merrill Lynch Capital Corporation, Inc. and General Electric
Capital Corporation and certain of their affiliates. Merrill Lynch,
Pierce, Fenner & Smith Inc. and Banc of America Securities LLC
are financial advisors to The Carlyle Group, and Debevoise &
Plimpton LLP is legal advisor. UBS Investment Bank is financial
advisor to ElkCorp, and Wachtell, Lipton, Rosen & Katz is legal
advisor. Citigroup Corporate and Investment Banking is financial
advisor to the Special Committee. About ElkCorp ElkCorp, through
its subsidiaries, manufactures Elk brand roofing and building
products (90% of consolidated revenue) and provides technologically
advanced products and services to other industries. Its common
stock is listed on the New York Stock Exchange (NYSE:ELK).
www.elkcorp.com About The Carlyle Group The Carlyle Group is a
global private equity firm with $46.9 billion under management.
Carlyle invests in buyouts, venture & growth capital, real
estate and leveraged finance in Asia, Europe and North America,
focusing on aerospace & defense, automotive &
transportation, consumer & retail, energy & power,
healthcare, industrial, technology & business services and
telecommunications & media. Since 1987, the firm has invested
$24 billion of equity in 576 transactions for a total purchase
price of $101.8 billion. The Carlyle Group employs more than 740
people in 16 countries. In the aggregate, Carlyle�s portfolio
companies have more than $68 billion in revenue and employ more
than 200,000 people around the world. www.carlyle.com Forward
Looking Statements. Statements made in this release, our website
and in our other public filings and releases, which are not
historical facts contain �forward-looking� statements (as defined
in the Private Securities Litigation Reform Act of 1995) that
involve risks and uncertainties and are subject to change at any
time. These forward-looking statements may include, but are not
limited to, statements containing words such as �anticipate,�
�contemplate,� �believe,� �plan,� �estimate,� �expect,� �intend,�
�may,� �target,� �look forward to� and similar expressions. Factors
that could cause actual results to differ materially include, but
are not limited to, the following: costs, litigation, an economic
downturn or changes in the laws affecting our business in those
markets in which we operate. There can be no assurance that the
tender offer, merger or other any other transaction will be
consummated, or if consummated, that it will increase shareholder
value. The forward-looking statements involve known and unknown
risks, uncertainties and other factors that are, in some cases,
beyond our control. We caution investors that any forward-looking
statements made by us are not guarantees of future performance or
events. We disclaim any obligation to update any such factors or to
announce publicly the results of any revisions to any of the
forward-looking statements to reflect future events or
developments, except to the extent required by law. Additional
Information and Where to Find It. In connection with the original
Carlyle tender offer announced on January 18, 2007, ElkCorp has
filed a solicitation/recommendation statement on Schedule 14D-9
with the Securities and Exchange Commission (the "SEC"), and
expects to file an amendment thereto in respect of the increased
purchase price. In connection with the proposed merger with
affiliates of The Carlyle Group, ElkCorp expects to file a proxy
statement with the SEC, if required by law. In connection with the
tender offer by an affiliate of BMCA, ElkCorp expects to file a
solicitation/recommendation statement on Schedule 14D-9 with the
SEC. Investors and security holders are strongly advised to read
these documents (when they become available in the case of those
not yet available) because they will contain important information
about the tender offer and the proposed merger. Free copies of
materials which will be filed by ElkCorp will be available at the
SEC's web site at www.sec.gov, or at the ElkCorp web site at
www.elkcorp.com, and will also be available, without charge, by
directing requests to ElkCorp, Investor Relations, 14911 Quorum
Drive, Suite 600, Dallas, TX 75254-1491, telephone (972) 851-0472.
ElkCorp and its directors, executive officers and other members of
its management and employees may be deemed participants in the
solicitation of tenders or proxies from its shareholders.
Information concerning the interests of ElkCorp's participants in
the solicitation is set forth in ElkCorp's proxy statements and
Annual Reports on Form 10-K, previously filed with the SEC, and
will be set forth in a proxy statement relating to the merger, if
one is required to be filed, and in the solicitation/recommendation
statements on Schedule 14D-9 when they become available.
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