SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
August 11, 1998
(Date of earliest event reported)
TEXTRON INC.
(Exact name of Registrant as specified in its charter)
Delaware 1-5480 05-0315468
(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
40 Westminster Street, Providence, Rhode Island 02903
(Address of principal executive offices, including zip code)
(401) 421-2800
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events.
On August 11, 1998, the Registrant, Textron Inc.
("Textron"), issued a press release announcing that it has
reached an agreement to sell its Avco Financial Services,
Inc. unit to Associates First Capital Corporation for $ 3.9
billion in cash. The press release also announced that
Textron's Board of Directors has authorized a new 25 million
share repurchase program that supersedes the 8 million
shares that remained under its previous authorization. A
copy of the press release is filed herewith as Exhibit 99
and is incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Exhibit
99 Press Release issued August 11, 1998.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
TEXTRON INC.
(Registrant)
By/s/Wayne W. Juchatz
Name: Wayne W. Juchatz
Title: Executive Vice President and
General Counsel
Dated: August 11, 1998
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit
99 Press Release issued August 11, 1998
<PAGE>
Investor Contact:
Mary Lovejoy
401-457-6009
Media Contact:
Susan Tardanico
401-457-2354 FOR IMMEDIATE
RELEASE
Textron to Sell Avco Financial Services to The Associates
Proceeds to Fund Acquisitions, Share Buyback;
Board Authorizes 25-Million-Share Repurchase Program
Providence, RI - August 11, 1998 - Textron Inc. today
announced it has reached an agreement to sell its Avco
Financial Services unit to Dallas, TX-based Associates
First Capital Corporation for $3.9 billion in cash.
Additional terms were not disclosed. The acquisition is
subject to regulatory approvals.
Net after-tax proceeds to Textron will approximate $2.9
billion. "These proceeds will enable us to accelerate our
acquisition and share buyback programs, consistent with our
focus on maximizing value for Textron shareholders," said
Textron President and Chief Executive Officer Lewis B.
Campbell. "Our primary objective is to redeploy these funds
into our existing market-leading businesses," he added.
-more-
<PAGE>
Textron to Sell Avco/P.2
Textron also announced today that its Board of
Directors has authorized a new 25-million-share repurchase
program. This program supercedes the 8 million shares that
remained under its previous authorization.
"This increased authorization will enable us to be more
aggressive in repurchasing shares, beginning immediately,"
Campbell said. "This, coupled with our disciplined
acquisition strategy, position us to maintain our record of
consistent, double-digit earnings growth."
It is anticipated that up to 40 % of the after-tax
proceeds from the sale of Avco will be used to repurchase
Textron shares, while the remaining 60 % will fund
acquisitions.
In the past five years, Textron has acquired 33
companies in the United States and Europe. Having invested
more than $500 million in five acquisitions to date this
year, the company has already exceeded last year's
acquisition activity. "With a full pipeline of
opportunities, we are well-positioned to continue our
aggressive acquisition activity," Campbell continued.
"However, we remain steadfast in our commitment to our
rigorous acquisition criteria."
With $1.85 billion in annual revenues, AFS comprised
18% of Textron's total 1997 revenues. "Our financial goals
are clear and have not changed," said Campbell. "We are
confident we will meet or exceed our targets of 8-11% annual
revenue growth and double-digit EPS growth, and we are
targeting revenues in excess of $14 billion by the year
2000," he added.
-more-
<PAGE>
Textron to Sell Avco/P.3
In June, Textron announced it was exploring strategic
alternatives for AFS, which could include a sale, spin-off
or other form of divestiture. With the increasing
consolidation of the consumer finance industry, Textron
concluded the value of AFS would be maximized by combining
it with another leading financial services company. The
strategic review did not include Textron's commercial
finance subsidiary, Textron Financial Corporation (TFC)
which finances the sale of Textron and third-party products.
TFC remains a part of Textron.
Textron Inc. (NYSE:TXT) is a $10.5 billion, global,
multi-industry company with market-leading operations in
Aircraft, Automotive, Industrial and Finance.
XXX
Certain statements in this news release are forward-looking
statements, including those that discuss strategies, goals,
outlook or other non-historical matters, or project
revenues, income, returns or other financial measures.
These forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ
materially from those contained in the statements, including
the following: (i) continued market demand for the types of
products and services produced and sold by Textron, (ii)
changes in worldwide economic and political conditions and
associated impact on interest and foreign exchange rates,
(iii) the level of sales by original equipment manufacturers
of vehicles for which Textron supplies parts, (iv) the
successful integration of companies acquired by Textron and
(v) changes in consumer debt levels.
