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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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): March 24, 1998
GERBER SCIENTIFIC, INC.
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(Exact name of Registrant as
specified in its charter)
CONNECTICUT 1-5865 06-0640743
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or File No.) Identification No.)
organization)
83 Gerber Road West, South Windsor, Connecticut 06074
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area (860) 644-1551
code: ---------------
Not applicable
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(Former name or former address, if changes since last report)
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Item 5. Other Events.
See the following press release, dated March 24, 1998, announcing
recommended cash offers for Spandex PLC.
Contact: Gary K. Bennett For Immediate Release
(860) 648-8004 March 24, 1998
Gerber Scientific, Inc. Announces Recommended Cash
Offers for Spandex PLC Acquisition of European Distributor
Will Enhance Gerber's Position in Global Signmaking and
Specialty Graphics Markets
South Windsor, CT-Gerber Scientific, Inc. (NYSE: GRB), the
world's leading supplier of automated manufacturing systems for
the signmaking, apparel, ophthalmic, and other industries, today
announced cash offers for the entire issued and to-be-issued
share capital of UK-based Spandex PLC (LSE: SPA), the largest
distributor of equipment and related materials to the signmaking
industry in Europe and North America.
Gerber Scientific is offering 325 pence in cash, with a Loan Note
Alternative, for each Ordinary Share of Spandex, and 325 pence
with a Loan Note Alternative, for each Spandex "A" Share. These
two offers, for the entire issued and to-be-issued share capital
of Spandex, value the company at approximately 109.2 million
pounds sterling (approximately $183 million). The offers have been
unanimously recommended by the board of directors of Spandex.
Gerber Scientific has received irrevocable undertakings to accept
its offer from the founder and Chairman of Spandex, Charles E.
Dobson, and from others, in respect of shares representing in
aggregate, 54.5 percent of the total Ordinary and "A" Shares of
Spandex.
In its results for the year ended December 31, 1997, announced on
March 10, 1998, Spandex reported profit before tax of 9.0
million pounds sterling ($14.8 million), on revenues of 101.3
million pounds sterling ($167 million). Gerber Scientific
anticipates that the acquisition, which is expected to close
in May 1998, will make a positive contribution to its earnings for
its next fiscal year which begins May 1, 1998. Upon completion
of the transaction, Spandex will become a wholly owned subsidiary
of Gerber Scientific, Inc. Another of Gerber Scientific's wholly
owned subsidiaries, Gerber Scientific Products (GSP), produces
the automated signmaking systems for which Spandex has served as
principal distributor in most of Europe for many years. More
recently, Spandex has become a distributor for GSP in North
America. The products of GSP represented approximately 12 percent
of Spandex's 1997 revenue.
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"Through the sales and marketing expertise of Spandex and the
engineering and manufacturing capabilities of GSP, Gerber
Scientific will be positioned to exploit opportunities in the
rapidly growing signmaking and specialty graphics markets. We
will also secure a very familiar, high-quality distribution
channel for our own products, as well as those of third parties
in the signmaking industry," said Mr. George M. Gentile, Chairman
and Chief Executive Officer of Gerber Scientific. "We believe
Spandex's business model can be replicated in other geographic
markets, such as South America, Central America, Eastern Europe,
and Asia, where there are significant opportunities for the two
companies' products," continued Mr. Gentile.
Mr. Charles E. Dobson, the founder and Chairman of Spandex, said,
"Spandex is pleased to announce this merger with Gerber
Scientific. We have a longstanding business relationship which
is now set to prosper further. Together, we will benefit from
the closer alignment of Gerber Scientific's skills as an
inventive manufacturer and those of Spandex as a marketer and
distributor."
Gerber Scientific expects to mail the formal offer document to
Spandex shareholders shortly.
Schroders is Gerber Scientific's financial advisor for the
transaction. Spandex is represented by Dresdner Kleinwort
Benson. Financing for the transaction is being provided by
Wachovia Bank, N.A.
GSP revolutionized signmaking in the early 1980s by introducing
automation systems that sharply reduced laborious manual work
while enhancing signmaker creativity, graphic impact, and sign
durability. Typical GSP end users are sign shops or screen
printers, and also include large specialized users such as point-
of-sale marketing organizations, fabricators, entertainment
complexes, and race-car-teams. GSP had revenues of $116 million
for the fiscal year ending April 30, 1997.
Gerber Scientific, Inc., the parent company of GSP, reported net
earnings of $16.3 million, or $0.70 diluted earnings per share,
on revenues of $310.2 million for the nine months ended January
31, 1998. In the same period last year, the Company reported net
earnings of $10.9 million, or $0.47 diluted earnings per share,
on revenues of $275.4 million. For the fiscal year ended April
30, 1997, the Company had revenues of $380.9 million and net
earnings of $16.0 million, or $0.69 diluted earnings per share.
Gerber Scientific, Inc. is a rapidly growing provider of advanced
computer-based systems and equipment to a broad range of
industries seeking to automate product design, pre-production,
manufacturing, and quality control. Industries served include
apparel and sewn goods, signmaking, graphic arts, ophthalmic,
automotive, and aerospace. In addition to GSP, Gerber Scientific
has three other principal subsidiaries: Gerber Garment
Technology, the world leader in providing automation solutions to
the apparel and sewn goods industries, from conceptual design
through assembly; Gerber Systems Corporation, a supplier of
computer automated systems for the commercial printing and
electronics industries; and Gerber Coburn, the world leader in
ophthalmic lens processing systems used in all aspects of
surfacing prescriptions in lens blanks and in matching lenses to
fit patients' frames.
Founded in 1976 and headquartered in Bristol, England, Spandex is
a leading marketer and distributor of equipment and related
materials to the sign and allied industries. Operating out of 13
countries in Europe, Spandex has more recently acquired sign
supplies distribution companies in Canada and the U.S. Spandex
is engaged in three main activities: the distribution of
signmaking systems, the distribution of signmaking materials, and
materials manufacturing. In signmaking systems, the company
markets, distributes, and supports computer-controlled signmaking
equipment such as vinyl cutting plotters, specialist sign
printers, and routers manufactured by GSP. In signmaking
materials, the company supplies a comprehensive range of
signmaking materials including self-adhesive vinyl, banner
materials, specialist signmaking films, application tapes, and
sign blanks and substrates, as well as extruded aluminum sign
systems and plastic components. In materials manufacturing, the
company manufactures self-adhesive vinyl films for the sign and
allied industries in addition to labeling films for the packaging
markets through its wholly-owned subsidiary, Ultramark Adhesive
Products Limited.
In addition to the historical information contained herein, there
are matters discussed which are considered to be "forward-looking
statements." The Private Securities Litigation Reform Act of
1995 provides a "safe harbor" for forward-looking statements.
These forward-looking statements involve risks and uncertainties,
including, but not limited to, economic, competitive,
governmental, and technological factors affecting the Company's
operations, markets, products, and services, that could
significantly affect results in the future.
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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.
GERBER SCIENTIFIC, INC.
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(Registrant)
Date: March 31, 1998 By: / s / Gary K. Bennett
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Gary K. Bennett
Senior Vice President, Finance
and Principal Accounting Officer
