SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):
February 9, 2000
Flowserve Corporation
(Exact name of Registrant as specified in its charter)
New York 1-13179 31-0267900
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation)
222 W. Las Colinas Blvd., Suite 1500
Irving, Texas 75039
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (972) 443-6500
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Item 5. Other Events.
We are filing this Current Report on Form 8-K to make
generally available certain information regarding the Registrant.
On February 9, 2000, the Registrant and Flowserve RED
Corporation, a Delaware corporation and wholly owned subsidiary of the
Registrant (collectively, the "Buyers"), entered into a definitive Purchase
Agreement with Ingersoll-Rand Corporation, a New Jersey corporation, and IDP
Acquisition LLC, a Delaware limited liability company (collectively, the
"Sellers"), whereby the Buyers will purchase 100% of the partnership interests
in Ingersoll-Dresser Pump Company, a Delaware general partnership, for $775
million in cash. A copy of the press release announcing the execution of the
definitive Purchase Agreement is set forth in Exhibit 99.1 to this Current
Report on Form 8-K and is hereby incorporated by reference herein.
Item 7. Financial Statements and Exhibits
(c) Press Release, dated February 10, 2000, by the Registrant.
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EXHIBIT INDEX
Exhibit
No. Description
- ------- -----------
99.1 Press Release, dated February 10, 2000, by the
Registrant.
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4
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.
FLOWSERVE CORPORATION
Date: February 16, 2000 By: /s/ Ronald F. Shuff
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Name: Ronald F. Shuff
Title: Vice President, Secretary and
General Counsel
[FLOWSERVE LOGO]
News Release
February 10, 2000
FROM: FLOWSERVE CORPORATION
SUBJECT: Flowserve to Acquire Ingersoll-Dresser Pumps for
$775 Million
FOR INFORMATION: Crystal C. Bell (972) 443-6557 (Investors)
Andrea Priest (212) 697-9191 (Media)
DALLAS, TEXAS - Flowserve Corporation today announced that it has
signed a definitive agreement to acquire Ingersoll-Dresser Pumps (IDP) for $775
million in cash. The acquisition will create the world's second largest pump
company.
The transaction, which will be accounted for as a purchase, will be
financed with a combination of bank financing and senior subordinated notes.
Flowserve has received $1.425 billion of committed financing from Credit Suisse
First Boston and Bank of America in connection with the acquisition. The
transaction is contingent on regulatory approvals and is expected to close in
mid-April. The acquisition should be accretive to earnings in 2001.
C. Scott Greer, President and Chief Executive Officer of Flowserve,
said, "The combination of Flowserve and IDP will form a platform for future
growth in earnings and cash flows, providing greater stability and growth for
Flowserve.
Flowserve Corporation 222 West Las Colinas Boulevard Phone 972-443-6500
Headquarters Suite 1500 Facsimile 972-443-6800
Irving, Texas 75039 USA www.flowserve.com
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Page 2 - Flowserve to Acquire Ingersoll-Dresser Pumps for $775 Million
"It is rare for a combination of two businesses to yield this amount of
available hard synergies, which should significantly lower the costs of the
total entity. These expected synergies will result in the elimination of a
number of overlapping facilities and other inefficiencies," said Greer.
"In addition to the cost savings, the acquisition strengthens our
petroleum and chemical product offerings and allows Flowserve to diversify in
the fast-growing water and power businesses. It also furthers our strategic goal
of achieving more balanced global coverage, strengthening our position in
Europe, Asia and Latin America," he continued.
"From a service perspective, not only is Flowserve acquiring some of
the best brands in the industry, but we will have access to one of the largest
installed bases of process pumps in the flow-control industry."
On a run rate, synergies are projected to be $75 million by the end of
2001. Due to the timing of the closing, some expected dissynergies and financing
costs, the acquisition is expected to be earnings neutral to slightly dilutive
to 2000 earnings. Flowserve intends to proceed with the integration of the two
businesses immediately upon closing the acquisition, with initial cost savings
being realized over the balance of 2000.
Flowserve also said today that it was suspending its quarterly cash
dividend effective immediately in order to reinvest in the growth of the
Company, and to better position the Company's stock for future appreciation.
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Page 3 - Flowserve to Acquire Ingersoll-Dresser Pumps for $775 Million
IDP is a wholly-owned business unit of Ingersoll-Rand Company (NYSE:
IR). With 1999 sales of $838 million and operating income of $64 million, IDP
offers a variety of pumps for diversified industrial use and specialty pumps for
process, power generation and marine applications.
Flowserve Corporation (NYSE: FLS) is one of the world's leading
providers of industrial flow management services. Operating in 28 countries,
with 1999 sales of $1.1 billion and about 7,000 employees, the Company produces
engineered pumps for the process industries, precision mechanical seals,
automated and manual quarter-turn valves, control valves and valve actuators,
and provides a range of related flow management services.
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SAFE HARBOR STATEMENT: This news release contains various forward-looking
statements and includes assumptions about Flowserve's future market conditions,
operations and results. These statements are based on current expectations and
are subject to significant risks and uncertainties. They are made pursuant to
safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Among the many factors that could cause actual results to differ materially from
the forward-looking statements are: further changes in the already competitive
environment for the Company's products or competitors' responses to Flowserve's
strategies; the Company's ability to integrate IDP and Invatec into its
management and operations; political risks or trade embargoes affecting
important country markets; the health of the petroleum, chemical and power
industries; economic turmoil in areas outside the United States; continued
economic growth within the United States; unanticipated difficulties or costs or
reduction in benefits associated with the implementation of the Company's
"Flowserver" business process improvement initiative including, software; the
recognition of significant expenses associated with adjustments to realign the
combined Company's facilities and other capabilities with its strategies and
business conditions, including without limitation expenses incurred in
restructuring the Company's operations to incorporate IDP facilities, and the
cost of financing to be assumed in acquiring IDP.
