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EXHIBIT 99.1 (Press Release)
Key Components Enters into Recapitalization Agreement
with Kelso & Company
Tarrytown, N.Y. - May 8, 2000 - Key Components, LLC (the "Company" or "KCI")
(CUSIP No. 9859Z), a leading manufacturer of custom-engineered essential
componentry, today announced that it has entered into an agreement with
affiliates of Kelso & Company ("Kelso") pursuant to which Kelso will purchase
from KCI shareholders up to $110,000,000 of Class A Non-Voting Preferred Stock
in KCI (the "Recapitalization").
Following the Recapitalization, John Dyson, Chairman, Clay Lifflander, Chief
Executive Officer, and other senior executives of KCI will hold 100% of the
common stock of KCI. Furthermore, Robert Kay, President, and other senior
executive management of the Company will continue in their current capacities.
After the Recapitalization, Kelso will have two seats on KCI's seven-member
Board of Directors.
Clay Lifflander said "We are extremely pleased to have entered into this
agreement with Kelso. KCI sought a partner who believes in KCI's strategic
vision to be a much larger world-class supplier of essential componentry and has
the capital and experience to help us achieve that goal. We believe that we have
found such a partner in Kelso. Their reputation precedes them as world-class
financial investors with vision and expertise. We look forward to sharing KCI's
future successes with them."
Philip Berney, Managing Director of Kelso, said "Kelso is extremely excited to
be partnering with Key Components. Through superior internal growth and a
properly-executed acquisition and integration program, KCI has grown from $13
million in revenues in 1996 to $150 million today. Such dramatic performance and
prospects make KCI an ideal investment for Kelso and we are greatly looking
forward to providing KCI with acquisition opportunities and capital to continue
this excellent track record."
The definitive agreement is subject to customary closing conditions, including
approval by KCI's bank syndicate. The Recapitalization transaction will not
trigger any rights or require any consents or waivers under the Company's
existing 10 1/2% Senior Notes due 2008. The Recapitalization is anticipated to
close within the next few weeks.
Kelso & Company, one of the oldest and most established firms specializing in
private equity investing, has been involved in acquisitions and
recapitalizations both as principal and as financial advisor since 1971. The
Firm makes equity investments on behalf of investment partnerships, which it
manages. Since 1980, Kelso has invested in more than 67 companies with total
enterprise value of more than $17 billion.
Key Components is a leading manufacturer of custom-engineered essential
componentry for application in a diverse array of end-use products. The Company
targets original equipment manufacturer ("OEM") markets where the Company
believes its value-added engineering and manufacturing capabilities, along with
its timely delivery, reliability, and customer service, enable it to
differentiate the Company from its competitors and enhance profitability. The
Company
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operates in two business segments, mechanical engineered components and
electrical components. The mechanical engineered components products consist
primarily of medium security lock products and accessories, flexible shaft and
remote valve control components, and turbocharger actuators and related
accessories. The Company's electrical components products include specialty
electrical components including, but not limited to, weather- and
corrosion-resistant wiring devices and battery chargers, and high-voltage
utility switches.
Key Components is an affiliate of Millbrook Capital Management, Inc. of
Millbrook, New York, an investment firm specializing in acquisitions and
management services.
This press release may contain forward-looking statements made in reliance upon
the safe harbor of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve a number of assumptions, risks and
uncertainties that could cause actual results of the Company to differ
materially from those matters expressed in or implied by such forward-looking
statements.
For further information please contact:
Company: Investor Relations:
Robert B. Kay Keith McGowan John Nesbett/Mary Ellen Adipietro
President Chief Financial Officer Lippert/Heilshorn & Associates
914-332-8088 914-332-8088 212-838-3777
