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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
SCHEDULE 13E-3
Rule 13E-3 Transaction Statement
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934)
-----------------------
TRIMAS CORPORATION
(Name of Issuer)
-----------------------
MASCOTECH, INC.
MASCOTECH ACQUISITION, INC.
TRIMAS CORPORATION
(Name of Person(s) Filing Statement)
-----------------------
Common Stock, $.01 Par Value
(Title of Class of Securities)
-----------------------
896215100
(CUSIP Number of Class of Securities)
-----------------------
Brian P. Campbell David B. Liner, Esq.
TriMas Corporation MascoTech, Inc.
315 East Eisenhower Parkway 21001 Van Born Road
Ann Arbor, Michigan 48108 Taylor, Michigan 48180
(313) 747-7025 (313) 274-7405
(Name, Address and Telephone Number of Persons Authorized to Receive Notices
and Communications on Behalf of Person(s) Filing Statement)
-----------------------
With Copies to:
David W. Ferguson, Esq. Jerome M. Schwartz, Esq.
Davis Polk & Wardwell Dickinson, Wright, Moon, Van Dusen & Freeman
450 Lexington Avenue 500 Woodward Avenue, Suite 4000
New York, NY 10017 Detroit, Michigan 48226
(212) 450-4000 (313) 223-3628
This statement is filed in connection with (check the appropriate box):
a. |_| The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the
Securities Exchange Act of 1934.
b. |_| The filing of a registration statement under the Securities Act of
1933.
c. |X| A tender offer.
d. |_| None of the above.
Check the following box if the soliciting materials or information
statement referred to in checking box (a) are preliminary copies: |_|
CALCULATION OF FILING FEE
================================================================================
Transaction Valuation* Amount of Filing Fee**
$912,927,132 $182,585
================================================================================
* Calculated by multiplying $34.50, the per share tender offer price, by
26,461, 656, the sum of the number of shares of Common Stock sought in the
Offer and the 327,647 shares of Common Stock subject to options that will
be vested and exercisable as of January 16, 1998.
** Calculated as 1/50 of 1% of the transaction value.
|X| Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: $182,585 Filing Party: MascoTech, Inc.
Form or Registration No.: Schedule 14D-1 Date Filed: December 17, 1997
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<PAGE>
INTRODUCTION
This Rule 13e-3 Transaction Statement on Schedule 13E-3 (the "Schedule
13E-3") is being filed by (i) MascoTech, Inc., a Delaware corporation
("Parent"), (ii) MascoTech Acquisition, Inc., a Delaware corporation
("Purchaser") and (iii) TriMas Corporation, a Delaware corporation (the
"Company") pursuant to Section 13(e) of the Securities Exchange Act of 1934, as
amended, and Rule 13e-3 thereunder in connection with the tender offer by
Purchaser for all of the issued and outstanding shares (the "Shares") of common
stock, $.01 par value per share, of the Company upon the terms and subject to
the conditions set forth in the Offer to Purchase dated December 17, 1997 (the
"Offer to Purchase") and the related Letter of Transmittal (which together
constitute the "Offer"), copies of which are filed as Exhibits (d)(1) and (d)(2)
hereto, respectively.
The following Cross Reference Sheet, prepared pursuant to General
Instruction F to Schedule 13E-3, shows the location in the Tender Offer
Statement on Schedule 14D-1 filed by Parent and Purchaser (the "Schedule 14D-1")
with the Securities and Exchange Commission on the date hereof of the
information required to be included in this Schedule 13E-3. The information set
forth in the Schedule 14D-1, including all exhibits thereto, is hereby expressly
incorporated herein by reference as set forth in the Cross Reference Sheet and
the responses in this Schedule 13E-3, and such responses are qualified in their
entirety by reference to the information contained in the Offer to Purchase and
the schedules and annexes thereto.
The information contained in this Schedule 13E-3 concerning the Company,
including, without limitation, the deliberations of the Company's Board of
Directors in connection with the transaction, the opinion of the Company's
financial advisor and the Company's capital structure and historical financial
statements and projections, was supplied by the Company. Parent and Purchaser
take no responsibility for the accuracy of such information. The information
contained in this Schedule 13E-3 concerning Parent and Purchaser was supplied by
Parent and Purchaser. The Company takes no responsibility for the accuracy of
such information.
2
<PAGE>
CROSS REFERENCE SHEET
WHERE LOCATED
ITEM IN SCHEDULE 13E-3 IN SCHEDULE 14D-1
- ------------------------- -----------------
Item 1(a) ..................................................... Item 1(a)
Item 1(b) ..................................................... Item 1(b)
Item 1(c) ..................................................... Item 1(c)
Item 1(d) ..................................................... *
Item 1(e) ..................................................... *
Item 1(f) ..................................................... *
Item 2(a) ..................................................... Item 2(a)
Item 2(b) ..................................................... Item 2(b)
Item 2(c) ..................................................... Item 2(c)
Item 2(d) ..................................................... Item 2(d)
Item 2(e) ..................................................... Item 2(e)
Item 2(f) ..................................................... Item 2(f)
Item 2(g) ..................................................... Item 2(g)
Item 3 ........................................................ Item 3
Item 4 ........................................................ *
Item 5 ........................................................ Item 5
Item 6(a) ..................................................... Item 4(a)
Item 6(b) ..................................................... *
Item 6(c) ..................................................... Item 4(b)
Item 6(d) ..................................................... *
Item 7(a) ..................................................... Item 5
Item 7(b) ..................................................... *
Item 7(c) ..................................................... *
Item 7(d) ..................................................... *
Item 8 ........................................................ *
Item 9 ........................................................ *
Item 10 ....................................................... Item 6
Item 11 ....................................................... Item 7
Item 12 ....................................................... *
Item 13 ....................................................... *
Item 14 ....................................................... *
Item 15(a) .................................................... *
Item 15(b) .................................................... Item 8
Item 16 ....................................................... Item 10(f)
Item 17 ....................................................... Item 11
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* The Item is located in the Schedule 13E-3 only.
3
<PAGE>
Item 1. Issuer and Class of Security Subject to the Transaction
(a)-(c) The response to Item 1(a)-(c) of the Schedule 14D-1 is incorporated
herein by reference.
(d) The information set forth in the Offer to Purchase under "Special
Factors--The Merger Agreement", "The Tender Offer--Price Range of Shares;
Dividends" and "The Tender Offer--Financing of the Offer and the Merger" is
incorporated herein by reference.
(e) Not applicable.
(f) Not applicable.
Item 2. Identity and Background
This Statement is filed by Purchaser, Parent and the Company. The response
to Item 2 of the Schedule 14D-1 is incorporated herein by reference. The
information set forth in the Offer to Purchase under "The Tender Offer--Certain
Information as to the Company" is incorporated herein by reference. During the
last five years, the Company and, to the best knowledge of the Company, none of
the persons listed in Schedule I of the Offer to Purchase has been (i) convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
activities subject to, federal or state securities laws or finding any violation
of such laws.
Item 3. Past Contacts, Transactions or Negotiations
The response to Item 3 of the Schedule 14D-1 is incorporated herein by
reference.
Item 4. Terms of the Transaction
(a) The information set forth in the Offer to Purchase on the cover page
thereof and under "Introduction", "Special Factors--Background of the Offer",
"Special Factors--The Merger Agreement", "The Tender Offer--Terms of the Offer",
"The Tender Offer--Acceptance for Payment and Payment for Shares", "The Tender
Offer--Procedures for Accepting the Offer and Tendering Shares", "The Tender
Offer--Withdrawal Rights", "The Tender Offer--Dividends and Distributions", "The
Tender Offer--Certain Conditions of the Offer", "The Tender Offer--Certain Legal
Matters" and "The Tender Offer--Miscellaneous" is incorporated herein by
reference.
(b) The information set forth in the Offer to Purchase under "Special
Factors--Interests of Certain Persons in the Offer and the Merger" is
incorporated herein by reference.
Item 5. Plans or Proposals of the Issuer or Affiliate
The response to Item 5 of the Schedule 14D-1 is incorporated herein by
reference.
Item 6. Source and Amount of Funds or Other Consideration
(a) The response to Item 4(a) of the Schedule 14D-1 is incorporated herein
by reference.
(b) The information set forth in the Offer to Purchase in "The Tender
Offer--Fees and Expenses" is incorporated herein by reference.
(c) The response to Item 4(b) of the Schedule 14D-1 is incorporated herein
by reference.
4
<PAGE>
(d) Not applicable.
Item 7. Purpose(s), Alternatives, Reasons and Effects
(a) The response to Item 5 of the Schedule 14D-1 is incorporated herein by
reference.
(b) The information set forth in the Offer to Purchase under "Special
Factors--Background of the Offer", "Special Factors--Recommendation of the
Special Committee and the Company Board; Fairness of the Offer and the Merger"
and "Special Factors--Purpose and Structure of the Offer and the Merger; Reasons
of Parent for the Offer and the Merger" is incorporated herein by reference.
(c)-(d) The information set forth in the Offer to Purchase under
"Introduction", "Special Factors--Background of the Offer", "Special
Factors--Recommendation of the Special Committee and the Company Board; Fairness
of the Offer and the Merger", "Special Factors--Purpose and Structure of the
Offer and the Merger; Reasons of Parent for the Offer and the Merger", "Special
Factors--Position of Parent and Purchaser Regarding Fairness of the Offer and
the Merger", "Special Factors--Plans for the Company After the Offer and the
Merger", "The Tender Offer--Certain Federal Income Tax Consequences" and "The
Tender Offer--Certain Effects of the Offer" is incorporated herein by reference.
Item 8. Fairness of the Transaction
(a)-(e) The information set forth in the Offer to Purchase under
"Introduction", "Special Factors--Background of the Offer ", "Special
Factors--Recommendation of the Special Committee and the Company Board; Fairness
of the Offer and the Merger", "Special Factors--Position of Parent and Purchaser
Regarding Fairness of the Offer and the Merger" and "Special Factors--Purpose
and Structure of the Offer and the Merger; Reasons of Parent for the Offer and
the Merger" is incorporated herein by reference.
(f) Not applicable.
Item 9. Reports, Opinions, Appraisals And Certain Negotiations
The information set forth in the Offer to Purchase under "Special
Factors--Background of the Offer", "Special Factors--Recommendation of the
Special Committee and the Company Board; Fairness of the Offer and the Merger",
"Special Factors--Opinion of Financial Advisor to the Special Committee",
"Special Factors--Opinion of Financial Advisor to Parent", "Special
Factors--Position of Parent and Purchaser Regarding Fairness of the Offer and
the Merger" and Annex B is incorporated herein by reference.
Item 10. Interest in Securities of the Issuer
The response to Item 6 of the Schedule 14D-1 is incorporated herein by
reference. The information set forth in the Offer to Purchase under "The Tender
Offer--Certain Information Concerning the Company" is incorporated herein by
reference.
Item 11. Contracts, Arrangements or Understandings with Respect to the Issuer's
Securities
The response to Item 7 of the Schedule 14D-1 is incorporated herein by
reference. The information set forth in the Offer to Purchase under "The Tender
Offer--Certain Information Concerning the Company" is incorporated herein by
reference.
5
<PAGE>
Item 12. Present Intention and Recommendation of Certain Persons with Regard to
the Offer and the Merger
The information set forth in the Offer to Purchase under "Introduction",
"Special Factors--Background of the Offer and the Merger", "Special
Factors--Recommendation of the Special Committee and the Company Board; Fairness
of the Offer and the Merger" and "Special Factors--Interests of Certain Persons
in the Offer and the Merger" is incorporated herein by reference.
Item 13. Other Provisions of the Offer and the Merger
(a) The information set forth in the Offer to Purchase under "Special
Factors--Rights of Stockholders in the Offer and the Merger", "Special
Factors--The Merger Agreement" and in Annexes A and C is incorporated herein by
reference.
(b) Not applicable.
(c) Not applicable.
Item 14. Financial Information
(a) The information set forth in the Offer to Purchase under "The Tender
Offer--Certain Information Concerning the Company" and "The Tender Offer--Price
Range of Shares; Dividends" is incorporated herein by reference. In addition,
the Company's audited financial statements for the fiscal years ended December
31, 1995 and December 31, 1996, and the Company's unaudited financial statements
for the period ended September 30, 1997, are attached to the Offer to Purchase
as Annexes D and E thereto, respectively.
(b) Not applicable.
Item 15. Persons and Assets Employed, Retained or Utilized
(a) The information set forth in the Offer to Purchase under "Special
Factors--Background of the Offer and the Merger", "Special
Factors--Recommendation of the Special Committee and the Company Board; Fairness
of the Offer and the Merger", "Special Factors--Plans for the Company After the
Offer and the Merger" and "The Tender Offer--Certain Effects of the Offer" is
incorporated herein by reference.
(b) The response to Item 8 of the Schedule 14D-1 is incorporated herein by
reference.
Item 16. Additional Information
The response to Item 10(f) of the Schedule 14D-1 is incorporated herein by
reference.
Item 17. Material to Be Filed as Exhibits
(a)(1) Commitment Letter (including the related term sheet), dated
December 10, 1997, from The First National Bank of Chicago, Bank
of America NT and NationsBank N.A.*
(b)(1) Opinion of BT Wolfensohn dated December 10, 1997 (attached as
Annex B to the Offer to Purchase).*
(b)(2) Presentation of BT Wolfensohn dated December 10, 1997.
(b)(3) Opinion of Salomon Smith Barney dated December 10, 1997.
6
<PAGE>
(b)(4) Presentation of Salomon Smith Barney dated December 10, 1997.
(c)(1) Registration Agreement, dated as of December 27, 1988, among the
Company, Masco Corporation and Parent (incorporated by reference
to the Company's Annual Report on Form 10-K for the year ended
December 31, 1992). Amendment dated as of April 21, 1992
(incorporated by reference to the Company's Annual Report on Form
10-K for the year ended December 31, 1996). Amendment dated as of
January 5, 1993 (incorporated by reference to the Company's
Annual Report on Form 10-K for the year ended December 31, 1992).
Amendment dated as of May 26, 1994 (incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended
December 31, 1994). Amendment dated as of May 15, 1996
(incorporated by reference to the Company's Annual Report on Form
10-K for the year ended December 31, 1996).
(c)(2) Agreement and Plan of Merger, dated as of December 10, 1997, as
amended by Amendment No. 1 dated as of December 15, 1997, among
the Company, Parent and Purchaser.*
(d)(1) Offer to Purchase dated December 17, 1997.*
(d)(2) Letter of Transmittal sent to holders of Shares.*
(d)(3) Notice of Guaranteed Delivery.*
(d)(4) Letter from Salomon Smith Barney to Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees.*
(d)(5) Letter to Clients for Use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.*
(d)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.*
(d)(7) Summary Advertisement as published in The Wall Street Journal on
December 17, 1997.*
(d)(8) Text of Press Release issued by Parent and the Company on
December 11, 1997.*
(d)(9) Text of Press Release issued by Parent on December 17, 1997.*
(e) Section 262 of the Delaware General Corporation Law (attached as
Annex C to the Offer to Purchase).*
(f) Not applicable.
(g)(1) Complaint filed in Sapsowitz v. Manoogian et al. (Court of
Chancery in the State of Delaware in and for New Castle County,
filed December 11, 1997).*
(g)(2) Complaint filed in Blue v. TriMas Corporation et al. (Court of
Chancery of the State of Delaware in and for New Castle County,
filed December 11, 1997).*
- -------------------
* Incorporated by reference to the Statement on Schedule 14D-1 filed by
Purchaser and Parent on December 17, 1997.
7
<PAGE>
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
December 17, 1997
MASCOTECH, INC.
By: /s/ David B. Liner
--------------------------------------------
Name: David B. Liner
Title: Vice President and Corporate Counsel
MASCOTECH ACQUISITION, INC.
By: /s/ David B. Liner
--------------------------------------------
Name: David B. Liner
Title: Secretary
TRIMAS CORPORATION
By: /s/ Brian P. Campbell
--------------------------------------------
Name: Brian P. Campbell
Title: President
8
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ---------- -----------
(b)(2) Presentation of BT Wolfensohn dated December 10, 1997.
(b)(3) Opinion of Salomon Smith Barney dated December 10, 1997.
(b)(4) Presentation of Salomon Smith Barney dated December 10, 1997.
9
<PAGE>
EXHIBIT (b)(2)
Confidential
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PROJECT MOTOWN
Presentation to the Oversight Committee
December 9, 1997
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BT Wolfensohn logo
The Information contained in this memorandum regarding Tiger was obtained from
Tiger and Mustang management and other sources that we believe to be reliable,
but has not been independently verified.
This memorandum has been prepared for the use of the Oversight Committee of
the Board of Directors of Tiger Corporation only. It is confidential and may
not be disclosed or provided to any third parties without the written
permission of BT Wolfensohn.
This memorandum is prepared as of December 9, 1997 and reflects information
made available to us prior to such date. It does include information
regarding all of the assessments made by BT Wolfensohn in arriving at its
conclusions.
Table of Contents
Section
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I. Executive Summary
o Summary of Proposed Transaction
o Financial Summary of the Proposed Transaction
o Summary of Key Transaction Events
o Intercompany and Director Relationships
o Tiger Stock Price History
o Other Considerations
II. Review of Tiger
o Historical Financial Statements
o Summary of Recent Analyst Research
o Ownership Profile and Liquidity Analysis
III. Valuation Analysis
o Selected Public Company Analysis
o Selected Precedent Transaction Analysis
o Discounted Cash Flow Analysis
IV. Pro Forma Combination Analysis
V. Appendix
o Analysis of Selected Companies
o Analysis of Selected Precedent Transactions
o Premiums Analysis for Selected Transactions
o Summary of Termination Fees for Selected Transactions
I. EXECUTIVE SUMMARY
Summary of Proposed Transaction
<TABLE>
<CAPTION>
<S> <C>
Transaction Mustang, a 37% shareholder and affiliate of Tiger, will offer to acquire all
shares not owned by Mustang pursuant to a cash tender offer and
second-step merger. The Chairman of Mustang, Mustang and Mustang's
largest shareholder (Mustang Corp.) hold in the aggregate approximately
45% of Tiger's shares.
Price/Offer $34.50 cash per share for all shares (approximately 25.3 million shares or
approximately 63% of outstanding shares) owned by the shareholders
other than Mustang.
Post-Transaction Tiger to become a wholly-owned subsidiary of Mustang upon completion
Ownership of merger.
Key Conditions to o Minimum Condition in Tender Offer requiring a majority of public shares
Tender and Merger (which shall for such purposes, exclude shares owned by Mustang,
Mustang Corp., its Chief Executive Officer and shares that may not be
tendered due to restrictions under Company Stock Plans).
o Recommendation of Oversight Committee; delivery of fairness opinion;
Tiger Board approval; filing of Schedules 14D-1, 14D-9 and 13E-3.
o Regulatory consents.
Key Representations/ Standard, to include corporate existence, authorization, non-contravention,
Warranties capitalization, absence of changes, no undisclosed material liabilities,
financial statements, regulatory filings.
Financing Commitment letter received by Mustang; financing not a condition to
Offer or Closing.
Termination Fees; Up to $5 million in reasonable expenses to either Tiger or Mustang if
Expenses either terminates the agreement due to a breach of representation,
warranty or obligation of the other.
$10 million to Mustang if Buyer terminates the agreement in response to
Board of Tiger withdrawing or modifying adverse to Buyer its
recommendation as a result of an acquisition proposal by a third party and
within 12 months of termination of agreement Tiger enters into a
transaction agreement with a third party; such fee to be payable only at
the consummation of transaction with a third party.
No Solicitation Standard, with fiduciary out in event of receipt of bona fide third party
acquisition proposal.
Timing Announcement expected on or about December 11, 1997; Offer to
commence within five days of announcement; tender offer to close in
mid-January if Minimum Condition is met; merger to follow.
</TABLE>
Financial Summary of the Proposed Transaction
($ in millions, except per share data)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
I. Enterprise Value:
Common Shares Outstanding 41.3 Gross Equity Value at $34.50/share $1,443.2
Total Options 0.5 Less: Option Proceeds 4.6
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Total Shares and Options Outstanding 41.8 Equity Value 1,438.6
==== --------
Plus: Debt 71.6
Less: Cash 126.0
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Total Enterprise Value $1,384.3
========
<CAPTION>
<S> <C>
II. Transaction Value:
Offer Price Per Share $34.50
Shares Subject to Cash Offer 25.30
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872.90
Cancellation of Options, Net 12.90
Rollover of Stock Awards 29.50
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Total $915.30
=======
<CAPTION>
<S> <C> <C>
III. Historical Trading Data and Premium: Tiger Price
Per Share Offer Premium %
----------- ---------------
Last Close (as of 12/5/97) $31.13 10.8%
One Week Prior (11/28/97) 31.00 11.3
One Month Prior (11/5/97) 29.56 16.7
Commencement of discussions (9/10/97) 28.19 22.4
52-Week High (12/3/97) 31.63 9.1
52-Week Low (1/30/97) 22.00 56.8
One Year Trailing Weighted Average Price 26.48 30.3
</TABLE>
Financial Summary of the Proposed Transaction
($ in millions, except per share data)
<TABLE>
<CAPTION>
IV. Purchase Price Multiples(a)
Tiger Transaction Range of
Financial Multiples At Range of Selected Selected Precedent
Data Offer Price Public Companies Transactions
---------- ------------- ------------------ -------------------
<S> <C> <C> <C> <C>
Enterprise Value Multiples
LTM Revenues $658.4 2.1x 0.8x-3.4x 0.7x-3.3x
LTM EBITDA 138.4 10.0 6.2x-13.6x 7.1x-14.8x
LTM EBIT 113.3 12.2 8.5x-16.7x 9.1x-16.3x
Equity Value Multiples
LTM Net Income $70.1 20.5x 12.2x-24.9x 12.7x-26.8x
1997 Est. Net Income(b) 72.5 19.8 12.7x-23.9x NA
1998 Est. Net Income(b) 80.6 17.8 11.5x-21.6x NA
Book Value 541.4 2.7 2.0x-5.2x 1.6x-5.7x
1998 I/B/E/S EPS 1.92 18.0 NA
<CAPTION>
<S> <C>
V. Discounted Stand-Alone Cash
Flow Analysis
Discount Rates: 10.5% - 12.5% $23.07 - $42.17
Terminal Value Assumptions:
(a) 8.0 - 10.0x EBITDA
(b) Perpetuity Growth Rates 3.0 - 5.0%
- ------------
(a) LTM results as of Septmeber 30, 1997.
(b) Tiger management projections.
</TABLE>
Summary of Key Transaction Events
o On September 10, 1997, Tiger's Board of Directors was notified by the
Chairman of Mustang Corporation that Mustang wished to commence
discussions to acquire the shares of Tiger that it did not already
own. The Tiger Board authorized the Committee to act and retain its
own advisers.
o On September 24, 1997, the Committee received a confidential preliminary
offer from Mustang, comprised of cash at $33.00 per share for 50% of
the shares to be purchased and one share of common stock for the
remaining 50% of the shares to be purchased of a newly formed company
("NewCo") designed to effect the mergers of Tiger and Mustang.
Mustang indicated that it had no interest in selling its existing
interest in Tiger.
o After consideration, the Committee sent a letter to Mustang on October 9,
rejecting the September 24 offer.
o On October 31, 1997, Mustang management and representatives of Smith
Barney presented a total transaction alternative proposal, comprised
of $33.00 cash per share for at least 50% but not more than 60% of
the total transaction consideration and convertible preferred stock
("CPS") of NewCo for the balance of the transaction consideration.
The Oversight Committee rejected the revised proposal.
o On November 7, 1997, BT Wolfensohn, on behalf of the Oversight Committee,
presented a counterproposal to Smith Barney. The proposal was $37.50
with 60% payable in cash, with the balance paid in Mustang
convertible preferred stock.
o Mustang rejected the counterproposal offered by the Oversight Committee
on November 10, 1997.
o On November 18, 1997, the Chairman of Mustang contacted the members of
the Oversight Committee requesting a meeting to discuss a transaction
at mutually acceptable terms.
o On November 21, 1997, a member of the Oversight Committee met with the
Chairman of Mustang. After extensive discussion and negotiation, a
preliminary understanding was reached to pursue a transaction,
subject to mutually acceptable terms and conditions, at $34.50 cash
per share for the shares of Tiger not owned by Mustang.
[ Graphic Omitted
Organizational chart titled "Intercompany and Director Relationships"
shows relationship between Richard Manooglan (Chairman, Mustang Corp.,
Mustang, Tiger) and Mustang Corp (Affiliate) directors,
Mustang (Offeror) directors and Tiger (Target) directors ]
[ Graphic Omitted
Chart titled "Tiger Stock Trading History - Tiger 5
Year Stock Chart - High-Low-Close & Volume" was
constructed using data from the table below ]
Tiger Stock Trading History
Security Price History
TRIMAS CORP COM 05-Dec-97
TMS 89621510 Common Stock NYSE
U.S. Dollar
<TABLE>
<CAPTION>
Date Volume High Low Close
<S> <C> <C> <C> <C>
04-Dec-92 1703000 14.500 11.875 14.125
11-Dec-92 128400 14.688 14.063 14.625
18-Dec-92 85000 14.875 14.500 14.500
24-Dec-92 118200 14.500 14.250 14.250
31-Dec-92 71000 14.563 14.250 14.500
08-Jan-93 75000 15.000 14.438 14.813
15-Jan-93 108200 14.938 14.563 14.813
22-Jan-93 91400 14.813 14.250 14.313
29-Jan-93 191000 14.563 14.313 14.313
05-Feb-93 176000 14.563 14.313 14.438
12-Feb-93 470000 15.500 14.438 15.375
19-Feb-93 159600 15.438 14.500 14.813
26-Feb-93 74600 15.438 14.563 15.438
05-Mar-93 159000 16.313 15.375 16.313
12-Mar-93 77000 16.500 15.813 15.938
19-Mar-93 54800 16.125 15.438 15.438
26-Mar-93 89600 15.563 15.313 15.563
02-Apr-93 147000 16.313 15.688 16.188
08-Apr-93 24400 16.063 15.750 16.000
16-Apr-93 29800 16.000 15.625 15.688
23-Apr-93 80600 16.438 15.688 16.375
30-Apr-93 298600 17.875 16.375 17.438
07-May-93 301800 17.375 16.563 16.563
14-May-93 65200 17.250 16.563 17.188
21-May-93 222600 17.375 16.938 16.938
28-May-93 72600 17.375 16.938 17.375
04-Jun-93 14800 17.875 17.438 17.625
11-Jun-93 221400 18.688 17.750 18.375
18-Jun-93 174200 18.375 17.250 18.125
25-Jun-93 129800 18.250 17.813 17.813
02-Jul-93 144600 18.813 17.750 18.438
09-Jul-93 69700 18.500 17.375 17.750
16-Jul-93 72000 20.000 17.875 19.500
23-Jul-93 52500 19.750 18.875 19.000
30-Jul-93 122900 19.125 17.750 17.750
06-Aug-93 236300 17.750 17.500 17.500
13-Aug-93 418600 18.000 17.000 17.500
20-Aug-93 126900 18.000 17.500 17.625
27-Aug-93 131600 18.250 17.500 18.125
03-Sep-93 159500 18.375 17.750 17.875
10-Sep-93 116800 18.375 17.750 18.000
17-Sep-93 265600 18.500 18.000 18.500
24-Sep-93 228900 19.000 18.250 18.250
01-Oct-93 148700 18.875 18.000 18.875
08-Oct-93 105100 19.125 18.250 19.125
15-Oct-93 92900 19.750 19.125 19.625
22-Oct-93 70100 19.875 19.250 19.500
29-Oct-93 276300 20.625 18.625 20.625
05-Nov-93 155900 21.000 18.875 20.750
12-Nov-93 85200 20.875 19.875 20.500
19-Nov-93 263200 21.625 20.625 21.125
26-Nov-93 241300 21.750 21.250 21.625
03-Dec-93 219700 22.250 21.375 21.750
10-Dec-93 269000 22.875 22.000 22.375
17-Dec-93 387000 23.375 22.000 23.250
23-Dec-93 224800 23.125 22.500 22.625
31-Dec-93 298300 24.625 22.625 24.375
07-Jan-94 389400 24.125 22.750 23.125
14-Jan-94 77700 23.500 22.750 23.125
21-Jan-94 150000 23.750 23.000 23.375
28-Jan-94 130100 24.375 23.625 24.125
04-Feb-94 191400 25.500 23.750 25.125
11-Feb-94 351700 26.500 24.750 26.500
18-Feb-94 274000 26.625 25.625 26.500
25-Feb-94 510600 28.250 26.625 27.875
04-Mar-94 472900 28.500 27.750 28.125
11-Mar-94 587900 28.375 25.250 25.750
18-Mar-94 139200 26.250 24.500 25.875
25-Mar-94 122800 25.875 25.000 25.250
31-Mar-94 160700 25.750 25.000 25.125
08-Apr-94 368000 26.000 23.500 26.000
15-Apr-94 337500 27.125 26.000 26.250
22-Apr-94 169700 26.125 24.500 25.250
29-Apr-94 126200 26.125 25.250 25.875
06-May-94 229300 26.875 25.875 25.875
13-May-94 163900 25.750 25.000 25.500
20-May-94 494000 25.500 25.250 25.375
27-May-94 566700 26.000 25.000 26.000
03-Jun-94 36400 26.000 25.375 25.750
10-Jun-94 265200 26.000 25.125 25.375
17-Jun-94 155700 25.125 23.875 23.875
24-Jun-94 545600 24.000 21.625 22.500
01-Jul-94 174700 24.125 22.000 24.000
08-Jul-94 59200 24.000 22.625 23.000
15-Jul-94 742400 23.500 22.000 23.000
22-Jul-94 176000 24.125 22.500 23.500
29-Jul-94 104700 23.500 22.875 23.125
05-Aug-94 185100 23.500 22.875 23.000
12-Aug-94 33700 23.125 22.500 22.625
19-Aug-94 198400 23.875 22.625 23.875
26-Aug-94 52100 24.875 23.125 24.500
02-Sep-94 153400 24.875 23.625 23.750
09-Sep-94 250500 23.500 23.000 23.000
16-Sep-94 142500 23.750 22.625 23.625
23-Sep-94 232500 24.125 22.000 22.000
30-Sep-94 143300 22.875 21.500 22.750
07-Oct-94 222400 22.875 21.500 22.250
14-Oct-94 230200 23.000 21.125 21.250
21-Oct-94 231000 23.500 21.250 23.250
28-Oct-94 45000 23.500 22.875 23.500
04-Nov-94 216100 23.625 21.500 22.750
11-Nov-94 53500 22.750 21.625 21.625
18-Nov-94 251800 22.875 21.500 22.125
25-Nov-94 37600 22.000 21.000 21.000
02-Dec-94 636000 21.125 18.625 20.125
09-Dec-94 441300 20.875 19.750 20.000
16-Dec-94 847600 19.750 18.375 18.625
23-Dec-94 231900 19.250 18.500 19.125
30-Dec-94 151800 20.250 19.000 20.000
06-Jan-95 175800 21.125 20.000 20.625
13-Jan-95 124400 20.500 19.750 20.375
20-Jan-95 96400 21.000 20.000 20.375
27-Jan-95 113500 20.375 19.625 19.750
03-Feb-95 143100 20.750 19.625 20.750
10-Feb-95 103100 22.250 21.000 22.000
17-Feb-95 192800 22.000 20.625 21.000
24-Feb-95 90200 21.625 21.000 21.625
03-Mar-95 90200 22.625 21.375 22.625
10-Mar-95 38900 22.750 22.000 22.250
17-Mar-95 71700 22.250 21.625 21.875
24-Mar-95 86500 22.000 20.375 21.875
31-Mar-95 53400 22.750 21.250 22.250
07-Apr-95 69600 22.375 21.625 22.000
13-Apr-95 148400 22.000 20.875 20.875
21-Apr-95 90300 22.500 21.000 22.375
28-Apr-95 104900 22.500 21.375 21.875
05-May-95 254400 23.250 21.500 22.750
12-May-95 147100 24.375 22.750 23.500
19-May-95 101500 23.750 23.000 23.375
26-May-95 127800 23.625 22.875 23.250
02-Jun-95 240100 23.250 22.375 22.875
09-Jun-95 114000 23.750 22.875 23.000
16-Jun-95 184400 23.625 22.000 22.000
23-Jun-95 226400 22.750 20.250 20.625
30-Jun-95 176800 23.000 20.750 23.000
07-Jul-95 231500 25.000 22.750 25.000
14-Jul-95 159900 25.500 23.375 23.375
21-Jul-95 135500 23.750 22.750 23.625
28-Jul-95 433200 23.750 21.250 21.250
04-Aug-95 539100 21.875 20.000 21.750
11-Aug-95 181800 22.375 21.125 21.625
18-Aug-95 179000 22.375 21.375 22.250
25-Aug-95 57400 22.500 21.250 21.750
01-Sep-95 97900 21.750 21.125 21.250
08-Sep-95 426600 22.750 20.750 22.375
15-Sep-95 317800 22.500 21.625 22.375
22-Sep-95 93500 22.375 21.625 21.750
29-Sep-95 72200 21.750 20.500 20.750
06-Oct-95 71200 21.500 20.500 21.125
13-Oct-95 126900 22.250 20.625 21.625
20-Oct-95 61400 21.875 21.125 21.125
27-Oct-95 332300 21.250 20.625 20.625
03-Nov-95 182600 21.500 20.625 21.000
10-Nov-95 89900 21.250 20.500 20.500
17-Nov-95 156300 21.000 20.375 20.625
24-Nov-95 189000 20.500 20.000 20.125
01-Dec-95 197300 20.125 19.000 19.875
08-Dec-95 215900 20.250 19.250 19.250
15-Dec-95 173400 20.250 19.250 19.375
22-Dec-95 275600 19.625 19.125 19.375
29-Dec-95 147200 19.500 18.375 18.750
05-Jan-96 157600 19.750 18.750 18.875
12-Jan-96 472400 18.875 17.750 18.000
19-Jan-96 479300 18.375 17.500 18.000
26-Jan-96 96700 18.500 16.875 17.750
02-Feb-96 107400 19.000 17.875 18.625
09-Feb-96 405600 18.875 18.125 18.438
16-Feb-96 791300 21.000 18.250 20.750
23-Feb-96 131900 21.875 20.875 21.875
01-Mar-96 373500 24.375 21.750 22.375
08-Mar-96 164300 22.875 21.875 21.875
15-Mar-96 244300 22.750 21.250 22.750
22-Mar-96 153000 23.500 22.125 22.625
29-Mar-96 212800 23.000 21.750 22.000
04-Apr-96 335500 22.625 21.750 22.250
12-Apr-96 673900 22.250 21.125 21.625
19-Apr-96 157200 22.000 20.875 21.625
26-Apr-96 81700 22.875 21.500 22.500
03-May-96 398200 25.000 22.375 25.000
10-May-96 495200 25.375 24.000 25.375
17-May-96 79600 25.500 24.000 24.500
24-May-96 116900 24.500 23.625 23.625
31-May-96 296300 24.000 23.000 23.750
07-Jun-96 213300 24.500 23.250 24.125
14-Jun-96 399000 25.000 23.750 24.625
21-Jun-96 546900 24.500 23.500 23.500
28-Jun-96 630100 23.500 23.125 23.375
05-Jul-96 175900 23.375 23.000 23.250
12-Jul-96 403700 23.375 22.250 22.625
19-Jul-96 234600 22.375 21.375 21.375
26-Jul-96 297200 21.125 19.875 20.375
02-Aug-96 52100 21.875 19.875 21.625
09-Aug-96 233200 23.250 21.875 23.000
16-Aug-96 63000 23.250 22.500 23.250
23-Aug-96 102300 23.750 23.125 23.500
30-Aug-96 89100 23.750 23.250 23.250
06-Sep-96 145800 23.875 23.250 23.875
13-Sep-96 107100 23.875 23.375 23.625
20-Sep-96 221000 24.250 23.250 24.250
27-Sep-96 90700 24.125 23.500 23.625
04-Oct-96 142500 24.750 23.375 24.750
11-Oct-96 46200 24.750 23.375 23.375
18-Oct-96 91100 23.500 22.875 22.875
25-Oct-96 51400 23.875 22.875 23.375
01-Nov-96 36100 23.500 22.375 23.250
08-Nov-96 185500 23.750 22.625 23.000
15-Nov-96 25700 23.250 22.750 23.250
22-Nov-96 317800 24.000 23.125 23.875
29-Nov-96 115600 25.500 23.500 25.375
06-Dec-96 97200 25.375 24.500 24.500
13-Dec-96 53600 24.625 23.625 23.750
20-Dec-96 65800 23.750 22.625 23.500
27-Dec-96 122800 23.500 22.625 23.500
03-Jan-97 353900 24.250 23.375 24.250
10-Jan-97 275200 24.375 22.875 23.375
17-Jan-97 202400 23.250 22.625 23.000
24-Jan-97 177900 23.250 22.375 22.500
31-Jan-97 129300 22.625 22.000 22.250
07-Feb-97 151500 23.500 22.125 23.375
14-Feb-97 1042900 24.000 23.125 24.000
21-Feb-97 462600 24.750 23.875 24.250
28-Feb-97 111800 24.500 24.125 24.375
07-Mar-97 472300 24.750 24.250 24.375
14-Mar-97 254200 24.750 24.000 24.125
21-Mar-97 435200 24.000 23.250 23.500
27-Mar-97 375300 23.750 23.375 23.625
04-Apr-97 321600 24.125 23.125 23.875
11-Apr-97 199800 24.000 23.125 23.375
18-Apr-97 290500 23.375 22.750 23.125
25-Apr-97 62900 23.750 23.000 23.375
02-May-97 110300 25.000 23.375 25.000
09-May-97 181800 27.125 24.875 25.750
16-May-97 123700 26.750 25.750 26.250
23-May-97 76600 28.125 25.750 28.125
30-May-97 162300 28.375 27.750 28.375
06-Jun-97 176300 29.125 28.250 29.125
13-Jun-97 203800 29.625 28.875 29.500
20-Jun-97 251900 31.000 29.500 29.875
27-Jun-97 166900 30.000 27.750 28.188
03-Jul-97 212900 28.750 27.625 28.750
11-Jul-97 170900 29.500 28.875 29.375
18-Jul-97 182800 29.625 29.250 29.563
25-Jul-97 52300 29.438 29.000 29.188
01-Aug-97 143600 29.375 29.000 29.375
08-Aug-97 124900 29.625 28.313 28.625
15-Aug-97 119100 29.000 27.250 27.250
22-Aug-97 143400 28.563 27.063 28.063
29-Aug-97 123600 28.875 28.063 28.625
05-Sep-97 135900 28.500 27.813 28.125
12-Sep-97 254400 30.500 28.000 30.375
19-Sep-97 131800 30.500 30.188 30.188
26-Sep-97 105500 31.563 30.188 30.750
03-Oct-97 95300 31.563 30.438 31.000
10-Oct-97 154100 30.938 29.625 30.063
17-Oct-97 142200 30.438 29.813 30.063
24-Oct-97 126800 30.188 29.813 30.000
31-Oct-97 99400 30.000 28.375 29.250
07-Nov-97 130000 30.188 28.750 29.250
14-Nov-97 113100 30.188 28.563 29.563
21-Nov-97 176000 30.188 29.688 30.000
28-Nov-97 108000 31.000 29.375 31.000
05-Dec-97 157000 31.813 31.000 31.125
</TABLE>
[ Graphic Omitted
Chart titled "Tiger Stock Trading History - Tiger 5
Year Stock Chart - High-Low-Close" was constructed
using data from the table below ]
Tiger Stock Trading History
04-Dec-92 14.5 11.875 14.125
11-Dec-92 14.688 14.063 14.625
18-Dec-92 14.875 14.5 14.5
25-Dec-92 14.5 14.25 14.25
01-Jan-93 14.563 14.25 14.5
08-Jan-93 15 14.438 14.813
15-Jan-93 14.938 14.563 14.813
22-Jan-93 14.813 14.25 14.313
29-Jan-93 14.563 14.313 14.313
05-Feb-93 14.563 14.313 14.438
12-Feb-93 15.5 14.438 15.375
19-Feb-93 15.438 14.5 14.813
26-Feb-93 15.438 14.563 15.438
05-Mar-93 16.313 15.375 16.313
12-Mar-93 16.5 15.813 15.938
19-Mar-93 16.125 15.438 15.438
26-Mar-93 15.563 15.313 15.563
02-Apr-93 16.313 15.688 16.188
09-Apr-93 16.063 15.75 16
16-Apr-93 16 15.625 15.688
23-Apr-93 16.438 15.688 16.375
30-Apr-93 17.875 16.375 17.438
07-May-93 17.375 16.563 16.563
14-May-93 17.25 16.563 17.188
21-May-93 17.375 16.938 16.938
28-May-93 17.375 16.938 17.375
04-Jun-93 17.875 17.438 17.625
11-Jun-93 18.688 17.75 18.375
18-Jun-93 18.375 17.25 18.125
25-Jun-93 18.25 17.813 17.813
02-Jul-93 18.813 17.75 18.438
09-Jul-93 18.5 17.375 17.75
16-Jul-93 20 17.875 19.5
23-Jul-93 19.75 18.875 19
30-Jul-93 19.125 17.75 17.75
06-Aug-93 17.75 17.5 17.5
13-Aug-93 18 17 17.5
20-Aug-93 18 17.5 17.625
27-Aug-93 18.25 17.5 18.125
03-Sep-93 18.375 17.75 17.875
10-Sep-93 18.375 17.75 18
17-Sep-93 18.5 18 18.5
24-Sep-93 19 18.25 18.25
01-Oct-93 18.875 18 18.875
08-Oct-93 19.125 18.25 19.125
15-Oct-93 19.75 19.125 19.625
22-Oct-93 19.875 19.25 19.5
29-Oct-93 20.625 18.625 20.625
05-Nov-93 21 18.875 20.75
12-Nov-93 20.875 19.875 20.5
19-Nov-93 21.625 20.625 21.125
26-Nov-93 21.75 21.25 21.625
03-Dec-93 22.25 21.375 21.75
10-Dec-93 22.875 22 22.375
17-Dec-93 23.375 22 23.25
24-Dec-93 23.125 22.5 22.625
31-Dec-93 24.625 22.625 24.375
07-Jan-94 24.125 22.75 23.125
14-Jan-94 23.5 22.75 23.125
21-Jan-94 23.75 23 23.375
28-Jan-94 24.375 23.625 24.125
04-Feb-94 25.5 23.75 25.125
11-Feb-94 26.5 24.75 26.5
18-Feb-94 26.625 25.625 26.5
25-Feb-94 28.25 26.625 27.875
04-Mar-94 28.5 27.75 28.125
11-Mar-94 28.375 25.25 25.75
18-Mar-94 26.25 24.5 25.875
25-Mar-94 25.875 25 25.25
01-Apr-94 25.75 25 25.125
08-Apr-94 26 23.5 26
15-Apr-94 27.125 26 26.25
22-Apr-94 26.125 24.5 25.25
29-Apr-94 26.125 25.25 25.875
06-May-94 26.875 25.875 25.875
13-May-94 25.75 25 25.5
20-May-94 25.5 25.25 25.375
27-May-94 26 25 26
03-Jun-94 26 25.375 25.75
10-Jun-94 26 25.125 25.375
17-Jun-94 25.125 23.875 23.875
24-Jun-94 24 21.625 22.5
01-Jul-94 24.125 22 24
08-Jul-94 24 22.625 23
15-Jul-94 23.5 22 23
22-Jul-94 24.125 22.5 23.5
29-Jul-94 23.5 22.875 23.125
05-Aug-94 23.5 22.875 23
12-Aug-94 23.125 22.5 22.625
19-Aug-94 23.875 22.625 23.875
26-Aug-94 24.875 23.125 24.5
02-Sep-94 24.875 23.625 23.75
09-Sep-94 23.5 23 23
16-Sep-94 23.75 22.625 23.625
23-Sep-94 24.125 22 22
30-Sep-94 22.875 21.5 22.75
07-Oct-94 22.875 21.5 22.25
14-Oct-94 23 21.125 21.25
21-Oct-94 23.5 21.25 23.25
28-Oct-94 23.5 22.875 23.5
04-Nov-94 23.625 21.5 22.75
11-Nov-94 22.75 21.625 21.625
18-Nov-94 22.875 21.5 22.125
25-Nov-94 22 21 21
02-Dec-94 21.125 18.625 20.125
09-Dec-94 20.875 19.75 20
16-Dec-94 19.75 18.375 18.625
23-Dec-94 19.25 18.5 19.125
30-Dec-94 20.25 19 20
06-Jan-95 21.125 20 20.625
13-Jan-95 20.5 19.75 20.375
20-Jan-95 21 20 20.375
27-Jan-95 20.375 19.625 19.75
03-Feb-95 20.75 19.625 20.75
10-Feb-95 22.25 21 22
17-Feb-95 22 20.625 21
24-Feb-95 21.625 21 21.625
03-Mar-95 22.625 21.375 22.625
10-Mar-95 22.75 22 22.25
17-Mar-95 22.25 21.625 21.875
24-Mar-95 22 20.375 21.875
31-Mar-95 22.75 21.25 22.25
07-Apr-95 22.375 21.625 22
14-Apr-95 22 20.875 20.875
21-Apr-95 22.5 21 22.375
28-Apr-95 22.5 21.375 21.875
05-May-95 23.25 21.5 22.75
12-May-95 24.375 22.75 23.5
19-May-95 23.75 23 23.375
26-May-95 23.625 22.875 23.25
02-Jun-95 23.25 22.375 22.875
09-Jun-95 23.75 22.875 23
16-Jun-95 23.625 22 22
23-Jun-95 22.75 20.25 20.625
30-Jun-95 23 20.75 23
07-Jul-95 25 22.75 25
14-Jul-95 25.5 23.375 23.375
21-Jul-95 23.75 22.75 23.625
28-Jul-95 23.75 21.25 21.25
04-Aug-95 21.875 20 21.75
11-Aug-95 22.375 21.125 21.625
18-Aug-95 22.375 21.375 22.25
25-Aug-95 22.5 21.25 21.75
01-Sep-95 21.75 21.125 21.25
08-Sep-95 22.75 20.75 22.375
15-Sep-95 22.5 21.625 22.375
22-Sep-95 22.375 21.625 21.75
29-Sep-95 21.75 20.5 20.75
06-Oct-95 21.5 20.5 21.125
13-Oct-95 22.25 20.625 21.625
20-Oct-95 21.875 21.125 21.125
27-Oct-95 21.25 20.625 20.625
03-Nov-95 21.5 20.625 21
10-Nov-95 21.25 20.5 20.5
17-Nov-95 21 20.375 20.625
24-Nov-95 20.5 20 20.125
01-Dec-95 20.125 19 19.875
08-Dec-95 20.25 19.25 19.25
15-Dec-95 20.25 19.25 19.375
22-Dec-95 19.625 19.125 19.375
29-Dec-95 19.5 18.375 18.75
05-Jan-96 19.75 18.75 18.875
12-Jan-96 18.875 17.75 18
19-Jan-96 18.375 17.5 18
26-Jan-96 18.5 16.875 17.75
02-Feb-96 19 17.875 18.625
09-Feb-96 18.875 18.125 18.438
16-Feb-96 21 18.25 20.75
23-Feb-96 21.875 20.875 21.875
01-Mar-96 24.375 21.75 22.375
08-Mar-96 22.875 21.875 21.875
15-Mar-96 22.75 21.25 22.75
22-Mar-96 23.5 22.125 22.625
29-Mar-96 23 21.75 22
05-Apr-96 22.625 21.75 22.25
12-Apr-96 22.25 21.125 21.625
19-Apr-96 22 20.875 21.625
26-Apr-96 22.875 21.5 22.5
03-May-96 25 22.375 25
10-May-96 25.375 24 25.375
17-May-96 25.5 24 24.5
24-May-96 24.5 23.625 23.625
31-May-96 24 23 23.75
07-Jun-96 24.5 23.25 24.125
14-Jun-96 25 23.75 24.625
21-Jun-96 24.5 23.5 23.5
28-Jun-96 23.5 23.125 23.375
05-Jul-96 23.375 23 23.25
12-Jul-96 23.375 22.25 22.625
19-Jul-96 22.375 21.375 21.375
26-Jul-96 21.125 19.875 20.375
02-Aug-96 21.875 19.875 21.625
09-Aug-96 23.25 21.875 23
16-Aug-96 23.25 22.5 23.25
23-Aug-96 23.75 23.125 23.5
30-Aug-96 23.75 23.25 23.25
06-Sep-96 23.875 23.25 23.875
13-Sep-96 23.875 23.375 23.625
20-Sep-96 24.25 23.25 24.25
27-Sep-96 24.125 23.5 23.625
04-Oct-96 24.75 23.375 24.75
11-Oct-96 24.75 23.375 23.375
18-Oct-96 23.5 22.875 22.875
25-Oct-96 23.875 22.875 23.375
01-Nov-96 23.5 22.375 23.25
08-Nov-96 23.75 22.625 23
15-Nov-96 23.25 22.75 23.25
22-Nov-96 24 23.125 23.875
29-Nov-96 25.5 23.5 25.375
06-Dec-96 25.375 24.5 24.5
13-Dec-96 24.625 23.625 23.75
20-Dec-96 23.75 22.625 23.5
27-Dec-96 23.5 22.625 23.5
03-Jan-97 24.25 23.375 24.25
10-Jan-97 24.375 22.875 23.375
17-Jan-97 23.25 22.625 23
24-Jan-97 23.25 22.375 22.5
31-Jan-97 22.625 22 22.25
07-Feb-97 23.5 22.125 23.375
14-Feb-97 24 23.125 24
21-Feb-97 24.75 23.875 24.25
28-Feb-97 24.5 24.125 24.375
07-Mar-97 24.75 24.25 24.375
14-Mar-97 24.75 24 24.125
21-Mar-97 24 23.25 23.5
28-Mar-97 23.75 23.375 23.625
04-Apr-97 24.125 23.125 23.875
11-Apr-97 24 23.125 23.375
18-Apr-97 23.375 22.75 23.125
25-Apr-97 23.75 23 23.375
02-May-97 25 23.375 25
09-May-97 27.125 24.875 25.75
16-May-97 26.75 25.75 26.25
23-May-97 28.125 25.75 28.125
30-May-97 28.375 27.75 28.375
06-Jun-97 29.125 28.25 29.125
13-Jun-97 29.625 28.875 29.5
20-Jun-97 31 29.5 29.875
27-Jun-97 30 27.75 28.188
04-Jul-97 28.75 27.625 28.75
11-Jul-97 29.5 28.875 29.375
18-Jul-97 29.625 29.25 29.563
25-Jul-97 29.438 29 29.188
01-Aug-97 29.375 29 29.375
08-Aug-97 29.625 28.313 28.625
15-Aug-97 29 27.25 27.25
22-Aug-97 28.563 27.063 28.063
29-Aug-97 28.875 28.063 28.625
05-Sep-97 28.5 27.813 28.125
12-Sep-97 30.5 28 30.375
19-Sep-97 30.5 30.188 30.188
26-Sep-97 31.563 30.188 30.75
03-Oct-97 31.563 30.438 31
10-Oct-97 30.938 29.625 30.063
17-Oct-97 30.438 29.813 30.063
24-Oct-97 30.188 29.813 30
31-Oct-97 30 28.375 29.25
07-Nov-97 30.188 28.75 29.25
14-Nov-97 30.188 28.563 29.563
21-Nov-97 30.188 29.688 30
05-Dec-97 31 29.375 31
05-Dec-97 31.813 31 31.125
1. 6/29/93 - Tiger issues $100 million convertible subordinated
debentures due August 1, 2003.
2. 11/23/93 - Tiger announces acquisition of Lamons Metal Gasket
Company for $60 million cash, plus contingent payments.
3. 3/94 - 9/94 - Mustang sells 540,000 shares of Tiger at $22.88 - $27.25.
4. 10/18/95 - First of Michigan initiates coverage of Tiger with a
"buy" rating.
5. 1/15/96 - Tiger raised to short-term "outperform" from "market
perform" by Everen Securities.
6. 2/29/96 - Tiger downgraded to short-term "market perform" from
"outperform" by Everen Securities.
7. 6/28/96 - Legg Mason initiates coverage of Tiger with an
"outperform-2" rating.
6/96 - 11/96 - Tiger acquires Queensland Towbars Pty. Ltd., The
Englass Group, Heinrich Stolz GmbH and Beaumont Bolt
& Gasket Co. for an aggregate $54.2 million of cash
and assumed liabilities.
8. 2/97 - 3/97 - Tiger redeems 5% convertible debentures due 2003.
[ Graphic Omitted
Chart titled "Tiger Stock Trading History -
TIGER vs. S&P 500 vs. COMPOSITE GROUP -
indexed to December 1, 1996"
was constructed using data from the table below ]
Tiger Stock Trading History
Tiger S&P 500 Composite
29-Nov-96 100 100 100
30-Nov-96 100 99.939 100.282
01-Dec-96 98.522 98.845 99.1
02-Dec-96 99.015 98.425 97.731
03-Dec-96 98.522 98.33 98.484
04-Dec-96 96.552 97.699 96.749
05-Dec-96 97.044 99.041 98.243
10-Dec-96 96.059 98.748 97.497
11-Dec-96 95.567 97.848 96.341
12-Dec-96 94.089 96.342 94.996
13-Dec-96 93.596 96.251 94.528
16-Dec-96 91.133 95.239 93.788
17-Dec-96 91.626 95.908 92.831
18-Dec-96 89.655 96.634 94.052
19-Dec-96 90.64 98.513 94.983
20-Dec-96 92.611 98.923 96.618
23-Dec-96 89.163 98.666 96.058
24-Dec-96 89.655 99.209 96.369
26-Dec-96 90.148 99.841 97.558
27-Dec-96 92.611 99.97 98.021
30-Dec-96 92.611 99.581 98.482
31-Dec-96 94.089 97.849 98.412
02-Jan-97 94.089 97.357 96.762
03-Jan-97 95.567 98.812 97.229
06-Jan-97 95.074 98.762 97.016
07-Jan-97 95.074 99.499 97.721
08-Jan-97 94.089 98.863 97.471
09-Jan-97 91.626 99.713 97.957
10-Jan-97 92.118 100.328 98.59
13-Jan-97 91.133 100.329 98.419
14-Jan-97 91.626 101.564 99.381
15-Jan-97 89.163 101.345 98.051
16-Jan-97 90.148 101.682 98.364
17-Jan-97 90.64 102.53 98.928
20-Jan-97 90.148 102.6 99.239
21-Jan-97 91.133 103.395 99.466
22-Jan-97 90.148 103.859 98.938
23-Jan-97 89.655 102.713 97.798
24-Jan-97 88.67 101.783 96.999
27-Jan-97 87.685 101.057 96.504
28-Jan-97 87.685 101.057 97.048
29-Jan-97 86.7 102.045 97.494
30-Jan-97 87.685 103.586 99.069
31-Jan-97 87.685 103.849 99.735
03-Feb-97 88.67 103.925 98.901
04-Feb-97 89.163 104.259 99.99
05-Feb-97 90.148 102.808 99.246
06-Feb-97 92.611 103.055 100.109
07-Feb-97 92.118 104.298 100.799
10-Feb-97 92.611 103.753 100.138
11-Feb-97 94.089 104.302 100.413
12-Feb-97 94.089 106.043 100.616
13-Feb-97 94.089 107.239 101.916
14-Feb-97 94.581 106.798 102.759
18-Feb-97 97.537 107.829 102.815
19-Feb-97 97.044 107.327 102.226
20-Feb-97 97.044 106.047 101.946
21-Feb-97 95.567 105.911 101.2
24-Feb-97 95.567 107.035 102.233
25-Feb-97 96.552 107.276 101.86
26-Feb-97 96.552 106.428 101.526
27-Feb-97 96.059 105.026 100.738
28-Feb-97 96.059 104.465 100.272
03-Mar-97 97.537 105.058 100.316
04-Mar-97 97.537 104.482 100.125
05-Mar-97 96.552 105.94 100.679
06-Mar-97 96.552 105.487 101.669
07-Mar-97 96.059 106.334 102.298
10-Mar-97 97.537 107.481 102.989
11-Mar-97 96.552 107.176 104.25
12-Mar-97 96.059 106.24 104.35
13-Mar-97 94.581 104.298 103.262
14-Mar-97 95.074 104.775 104.627
17-Mar-97 94.089 105.111 104.705
18-Mar-97 93.596 104.312 104.416
19-Mar-97 92.611 103.798 104.621
20-Mar-97 92.118 103.386 103.724
21-Mar-97 92.611 103.577 103.725
24-Mar-97 92.611 104.474 104.225
25-Mar-97 92.118 104.234 103.447
26-Mar-97 92.611 104.423 102.361
27-Mar-97 93.103 102.227 100.956
31-Mar-97 92.611 100.013 98.974
01-Apr-97 95.074 100.346 100.183
02-Apr-97 93.596 99.087 100.018
03-Apr-97 93.596 99.115 99.119
04-Apr-97 94.089 100.116 100.804
07-Apr-97 93.596 100.675 101.41
08-Apr-97 94.089 101.202 101.334
09-Apr-97 94.089 100.473 101.153
10-Apr-97 92.118 100.174 100.988
11-Apr-97 92.118 97.441 98.588
14-Apr-97 90.64 98.244 98.724
15-Apr-97 90.64 99.696 100.281
16-Apr-97 91.133 100.86 101.454
17-Apr-97 91.133 100.627 102.126
18-Apr-97 91.133 101.231 102.631
21-Apr-97 91.626 100.443 102.184
22-Apr-97 92.611 102.324 103.596
23-Apr-97 91.133 102.195 104.042
24-Apr-97 92.611 101.87 104.258
25-Apr-97 92.118 101.103 103.649
28-Apr-97 94.581 102.106 103.924
29-Apr-97 96.552 104.892 105.428
30-Apr-97 97.044 105.855 105.445
01-May-97 97.044 105.483 106.143
02-May-97 98.522 107.391 107.551
05-May-97 102.463 109.672 110.738
06-May-97 103.941 109.345 109.473
07-May-97 101.478 107.741 108.638
08-May-97 100.493 108.354 108.751
09-May-97 101.478 108.951 109.537
12-May-97 104.434 110.652 111.470
13-May-97 102.956 110.054 110.61
14-May-97 104.434 110.438 111.283
15-May-97 101.97 111.21 111.885
16-May-97 103.448 109.607 110.654
19-May-97 104.434 110.072 111.453
20-May-97 105.419 111.181 111.314
21-May-97 105.911 110.876 110.619
22-May-97 108.867 110.388 111.299
23-May-97 110.837 111.89 113.292
27-May-97 111.823 112.244 113.573
28-May-97 110.837 111.914 113.949
29-May-97 110.345 111.5 114.302
30-May-97 111.823 112.055 114.639
02-Jun-97 111.823 111.802 114.942
03-Jun-97 114.286 111.685 115.458
04-Jun-97 113.3 110.976 115.167
05-Jun-97 114.286 111.414 115.437
06-Jun-97 114.778 113.34 116.297
09-Jun-97 115.764 113.988 116.9
10-Jun-97 116.256 114.299 117.083
11-Jun-97 115.764 114.868 117.036
12-Jun-97 115.764 116.705 119.657
13-Jun-97 116.256 117.998 119.889
16-Jun-97 118.227 118.081 119.046
17-Jun-97 119.704 118.15 118.274
18-Jun-97 120.197 117.442 118.859
19-Jun-97 122.168 118.622 119.519
20-Jun-97 117.734 118.715 119.711
23-Jun-97 118.227 116.063 117.612
24-Jun-97 116.749 118.404 119.354
25-Jun-97 114.778 117.433 118.138
26-Jun-97 111.576 116.731 117.394
27-Jun-97 111.084 117.21 119.077
30-Jun-97 110.837 116.924 117.375
01-Jul-97 110.837 117.702 118.982
02-Jul-97 112.315 119.42 121.131
03-Jul-97 113.3 121.122 121.237
07-Jul-97 115.271 120.499 120.964
08-Jul-97 115.271 121.364 121.413
09-Jul-97 115.764 119.883 120.219
10-Jul-97 115.517 120.708 121.52
11-Jul-97 115.764 121.091 122.326
14-Jul-97 116.01 121.315 122.725
15-Jul-97 116.01 122.29 125.122
16-Jul-97 116.502 123.721 126.133
17-Jul-97 116.502 123.063 126.77
18-Jul-97 116.502 120.908 124.901
21-Jul-97 115.517 120.597 124.183
22-Jul-97 115.517 123.376 126.92
23-Jul-97 115.517 123.717 127.002
24-Jul-97 115.271 124.211 127.148
25-Jul-97 115.025 124.011 125.995
28-Jul-97 115.517 123.702 125.981
29-Jul-97 114.532 124.474 127.962
30-Jul-97 115.271 125.795 128.643
31-Jul-97 115.025 126.059 128.33
01-Aug-97 115.764 125.114 127.326
04-Aug-97 115.764 125.532 127.596
05-Aug-97 116.01 125.805 127.549
06-Aug-97 115.025 126.855 128.999
07-Aug-97 115.271 125.649 128.064
08-Aug-97 112.808 123.318 124.771
11-Aug-97 112.808 123.775 125.142
12-Aug-97 113.3 122.392 124.318
13-Aug-97 112.315 121.796 123.922
14-Aug-97 111.823 122.159 124.428
15-Aug-97 107.389 118.994 122.697
18-Aug-97 110.345 120.537 123.718
19-Aug-97 109.852 122.323 124.484
20-Aug-97 111.084 124.085 126.314
21-Aug-97 111.33 122.196 124.468
22-Aug-97 110.591 121.998 125.16
25-Aug-97 110.837 121.55 125.351
26-Aug-97 113.547 120.607 124.958
27-Aug-97 113.054 120.697 123.803
28-Aug-97 112.069 119.372 122.935
29-Aug-97 112.808 118.817 123.063
02-Sep-97 111.823 122.53 123.497
03-Sep-97 111.084 122.567 124.308
04-Sep-97 111.084 122.965 124.215
05-Sep-97 110.837 122.725 124.127
08-Sep-97 111.084 123.009 124.307
09-Sep-97 112.315 123.328 123.645
10-Sep-97 111.084 121.401 122.086
11-Sep-97 112.315 120.55 121.152
12-Sep-97 119.704 122.046 122.457
15-Sep-97 119.458 121.499 122.184
16-Sep-97 119.704 124.916 125.026
17-Sep-97 119.212 124.567 124.745
18-Sep-97 119.704 125.134 124.769
19-Sep-97 118.966 125.559 124.654
22-Sep-97 119.704 126.209 124.634
23-Sep-97 119.704 125.747 124.765
24-Sep-97 120.443 124.763 123.846
25-Sep-97 120.443 123.895 123.325
26-Sep-97 121.182 124.861 124.465
29-Sep-97 121.429 125.933 124.847
30-Sep-97 120.197 125.133 125.445
01-Oct-97 122.168 126.207 126.322
02-Oct-97 121.921 126.874 127.321
03-Oct-97 122.168 127.477 126.896
06-Oct-97 121.921 128.489 128.368
07-Oct-97 119.704 129.867 129.291
08-Oct-97 118.719 128.641 128.499
09-Oct-97 118.227 128.216 129.376
10-Oct-97 118.473 127.735 128.486
13-Oct-97 118.227 127.883 128.345
14-Oct-97 117.734 128.171 128.693
15-Oct-97 118.227 127.569 129.282
16-Oct-97 119.951 126.183 127.924
17-Oct-97 118.473 124.721 127.156
20-Oct-97 118.227 126.233 128.706
21-Oct-97 118.719 128.435 130.857
22-Oct-97 118.473 127.935 130.084
23-Oct-97 118.227 125.583 127.888
24-Oct-97 118.227 124.388 127.979
27-Oct-97 116.256 115.848 121.857
28-Oct-97 113.547 121.774 122.502
29-Oct-97 113.3 121.418 122.618
30-Oct-97 113.547 119.373 121.124
31-Oct-97 115.271 120.818 123.132
03-Nov-97 114.778 124.038 125.287
04-Nov-97 115.764 124.271 126.358
05-Nov-97 116.502 124.536 127.249
06-Nov-97 118.719 123.911 128.225
07-Nov-97 115.271 122.521 126.939
10-Nov-97 116.01 121.678 126.247
11-Nov-97 115.517 122.015 124.739
12-Nov-97 117.241 119.675 123.425
13-Nov-97 114.286 121.088 123.949
14-Nov-97 116.502 122.632 124.636
17-Nov-97 118.227 124.99 126.155
18-Nov-97 118.719 123.937 124.782
19-Nov-97 118.719 124.777 125.305
20-Nov-97 118.719 126.678 127.187
21-Nov-97 118.227 127.221 127.226
24-Nov-97 116.749 125.052 125.957
25-Nov-97 118.966 125.6 125.883
26-Nov-97 120.936 125.709 126.631
28-Nov-97 122.168 126.205 127.473
01-Dec-97 124.138 128.764 129.244
02-Dec-97 124.384 128.356 129.341
05-Dec-97 124.631 129.028 127.976
04-Dec-97 123.645 128.544 127.833
05-Dec-97 122.66 129.956 129.392
[ Graphic Omitted
Chart titled "Tiger Stock Trading History -
TIGER vs. S&P 500 vs. COMPOSITE GROUP -
indexed to August 29, 1997"
was constructed using data from the table below ]
Tiger Stock Trading History
Composite TIGER S&P 500
29-Aug-97 100 100 100
02-Sep-97 100.363 99.127 103.125
03-Sep-97 101.008 98.472 103.156
04-Sep-97 100.946 98.472 103.491
05-Sep-97 100.86 98.253 103.289
08-Sep-97 100.997 98.472 103.528
09-Sep-97 100.463 99.563 103.797
10-Sep-97 99.202 98.472 102.175
11-Sep-97 98.445 99.563 101.459
12-Sep-97 99.488 106.114 102.717
15-Sep-97 99.266 105.895 102.257
16-Sep-97 101.558 106.114 105.133
17-Sep-97 101.344 105.677 104.84
18-Sep-97 101.368 106.114 105.316
19-Sep-97 101.271 105.459 105.674
22-Sep-97 101.271 106.114 106.221
23-Sep-97 101.376 106.114 105.832
24-Sep-97 100.66 106.769 105.004
25-Sep-97 100.246 106.769 104.274
26-Sep-97 101.171 107.424 105.086
29-Sep-97 101.496 107.642 105.989
30-Sep-97 101.977 106.55 105.315
01-Oct-97 102.687 108.297 106.219
02-Oct-97 103.502 108.079 106.781
03-Oct-97 103.159 108.297 107.289
06-Oct-97 104.346 108.079 108.14
07-Oct-97 105.091 106.114 109.3
08-Oct-97 104.444 105.24 108.268
09-Oct-97 105.16 104.803 107.91
10-Oct-97 104.441 105.022 107.506
13-Oct-97 104.338 104.803 107.63
14-Oct-97 104.616 104.367 107.872
15-Oct-97 105.097 104.803 107.365
16-Oct-97 104.001 106.332 106.199
17-Oct-97 103.361 105.022 104.968
20-Oct-97 104.613 104.803 106.241
21-Oct-97 106.359 105.24 108.095
22-Oct-97 105.747 105.022 107.673
23-Oct-97 103.978 104.803 105.694
24-Oct-97 104.06 104.803 104.688
27-Oct-97 99.111 103.057 97.501
28-Oct-97 99.611 100.655 102.488
29-Oct-97 99.711 100.437 102.189
30-Oct-97 98.498 100.655 100.468
31-Oct-97 100.133 102.183 101.684
03-Nov-97 101.887 101.747 104.394
04-Nov-97 102.765 102.62 104.59
05-Nov-97 103.471 103.275 104.813
06-Nov-97 104.266 105.24 104.287
07-Nov-97 103.224 102.183 103.117
10-Nov-97 102.657 102.838 102.408
11-Nov-97 101.423 102.402 102.692
12-Nov-97 100.363 103.93 100.722
13-Nov-97 100.776 101.31 101.911
14-Nov-97 101.331 103.275 103.211
17-Nov-97 102.545 104.803 105.195
18-Nov-97 101.448 105.24 104.309
19-Nov-97 101.879 105.24 105.016
20-Nov-97 103.393 105.24 106.616
21-Nov-97 103.427 104.803 107.073
24-Nov-97 102.399 103.493 105.248
25-Nov-97 102.345 105.459 105.709
26-Nov-97 102.944 107.205 105.8
28-Nov-97 103.623 108.297 106.218
01-Dec-97 105.053 110.044 108.372
02-Dec-97 105.134 110.262 108.028
03-Dec-97 104.033 110.48 108.594
04-Dec-97 103.914 109.607 108.186
05-Dec-97 105.2 108.734 109.374
[ Graphic Omitted
Chart titled "Tiger Volume at Price
December 1, 1996 - December 5, 1997"
was constructed using data from the table below ]
Tiger Volume at Price
December 1, 1996 - December 5, 1997
At or Below
At this Price This Price
$23 0.047 0.047
$24 0.342 0.389
$25 0.161 0.55
$26 0.02 0.57
$27 0.021 0.591
$28 0.019 0.61
$29 0.125 0.735
$30 0.145 0.88
$31 0.102 0.982
$32 0.018 1.00
Other Considerations
<TABLE>
<CAPTION>
<S> <C>
Considerations
----------------------------------------------------------
1. Principal alternative -- continuation as a o Share values captured in discounted cash flow analysis
public company with existing affiliate
relationships
2. Other alternatives (unlikely or problematic)
(a) Recapitalization
(i) Special Dividend; pro rata stock o Likely adverse tax consequences
repurchase
(ii) Buyout of Mustang shares o Mustang repeatedly stated no interest in selling its
ownership position
(iii) Self tender for public shares o Problematic for 37% holder (Mustang)
o Price of self-tender vs. current offer proposed by Mustang
o Liquidity of stock stub post-tender
(b) Third Party Offer o Unlikely due to current stock ownership positions of
Mustang, Chairman of Mustang, Mustang Corp.
o No standstill for Mustang or its affiliates
</TABLE>
<PAGE>
II. REVIEW OF TIGER
<PAGE>
Tiger Historical Summary Financials
($ in millions, except per share data)
Income Statements
<TABLE>
<CAPTION>
For Years Ended December 31,
---------------------------------------------------------- CAGR/ LTM
1992(a) 1993 1994 1995 1996 AVG. 9/30/97
--------- --------- --------- --------- --------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Revenues(b) $388.2 $443.2 $535.5 $553.5 $600.2 11.5% $658.4
EBITDA 75.5 88.5 112.0 120.2 127.2 13.9% 138.4
EBIT 58.6 70.0 91.4 98.7 104.3 15.5% 113.3
Net Income $29.8 $38.0 $50.1 $56.0 $61.4 19.8% $70.1
======== ======= ======= ======= ======= =======
Earnings Per Share $0.87 $1.05 $1.35 $1.51 $1.66 17.5% $1.78
======== ======= ======= ======= ======= =======
Margins
- -------
EBITDA Margin 19.5% 20.0% 20.9% 21.7% 21.2% 21.0%
EBIT Margin 15.1% 15.8% 17.1% 17.8% 17.4% 17.2%
Net Income Margin 7.7% 8.6% 9.4% 10.1% 10.2% 10.6%
Growth Rates
- ------------
Net Revenue 14.4% 14.2% 20.8% 3.4% 8.4% 13.6%
EBITDA 11.1% 17.2% 26.6% 7.3% 5.8% 11.6%
EBIT 8.6% 19.4% 30.6% 8.0% 5.7% 11.7%
Net Income 47.0% 27.6% 31.8% 11.8% 9.6% 18.5%
Earnings Per Share 29.9% 20.7% 28.6% 11.9% 9.9% 11.9%
- ---------------------------------
Source: Tiger 10-K, 10-Q filings.
(a) EBITDA, EBIT and Net Income exclude extraordinary charge of $5.7 million related to the early extinguishment of debt.
(b) In late 1993, the Company acquired Lamons Metal Gasket Co. from Mustang for $60.3 million, adding approximately
$48.3 million to revenue in 1994. In 1996, the Company also acquired The Englass Group, Heinrich Stolz, Queensland
Towbars and Beaumont Bolt & Gasket Company, adding approximately $45.0 million to 1997 revenue estimates.
</TABLE>
<TABLE>
Tiger Historical Summary Financials
($ in millions)
Balance Sheets
<CAPTION>
As of December 31,
---------------------------------------------------
1992 1993 1994 1995 1996 9/30/97
------ ------ ------ ------ ------ -------
<S> <C> <C> <C> <C> <C> <C>
Assets
Current Assets
Cash & Equivalents $64.8 $69.8 $107.7 $92.4 $105.9 $126.0
Receivables 46.6 58.7 64.2 71.2 80.4 93.4
Inventories 60.8 76.7 79.6 85.5 92.2 89.7
Other Current Assets 9.0 9.8 11.8 2.5 4.1 5.3
------- ------- ------- ------- ------- -------
Total Current Assets 181.1 215.0 263.2 251.6 282.6 314.3
Property & Equipment 144.9 162.2 168.4 173.7 194.5 194.7
Other Long-Term Assets 140.6 186.9 182.7 191.1 219.5 218.1
------- ------- ------- ------- ------- -------
Total Assets $466.6 $564.1 $614.3 $616.4 $696.7 $727.1
======= ======= ======= ======= ======= =======
Liabilities & Shareholders' Equity
Current Liabilities
Accounts Payable $16.9 $20.3 $21.6 $24.4 $33.8 $29.4
Current Portion of Long-Term Debt 0.1 0.3 0.3 -- -- --
Other Current Liabilities 32.4 30.6 33.8 29.7 45.4 37.2
------- ------- ------- ------- ------- -------
Total Current Liabilities 49.3 51.2 55.6 54.1 79.2 66.5
Deferred Income Taxes & Other 23.4 29.2 29.5 36.4 39.9 47.5
Long-Term Debt 178.5 238.9 238.6 187.2 187.1 71.6
------- ------- ------- ------- ------- -------
Total Liabilities 251.2 319.3 323.7 277.7 306.2 185.7
Shareholders' Equity
Preferred Stock $0.1 -- -- -- -- --
Total Shareholders' Equity 215.4 244.9 290.6 338.7 390.5 541.4
------- ------- ------- ------- ------- -------
Total Liabilities & Shareholders' Equity $466.6 $564.1 $614.3 $616.4 $696.7 $727.1
======= ======= ======= ======= ======= =======
- ---------------------------------
Source: Tiger 10-K, 10-Q filings.
</TABLE>
<TABLE>
Summary of Recent Analyst Research
<CAPTION> Earnings
Target Estimates
Institution House/ Share --------------
Analyst Date Recommendation Price 1997 1998 Commentary
- --------------------- ------- -------------- ---------- ------ ------ ------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Salomon Smith Barney/ 12/1/97 "3L-Neutral" $30.00 $1.75 $1.95 "We believe that the shares are fairly valued at
Donald Zwyer 15x estimated 1998 EPS and re-initiate coverage
with a neutral/low risk rating."
Roney & Co. 8/14/97 "Buy" $35.00 $1.71 $1.97 "Selling to literally dozens of niche markets
and producing hundreds of products, Tiger is
well insulated from both general economic trends
and individual industry risk. As a result,
earnings are highly predictable... Tiger trades
at a substantial multiple discount to both the
market and comparable companies, a discount that
is unjustified by the Company's growth record,
prospects and superior financial condition. We
expect investors to benefit from both earnings
growth and multiple expansion over the next
twelve months."
Barrington Research 8/6/97 "1-Buy" NA $1.77 $1.98 NA
Associates/
Walter Liptak
Lehman Brothers/ 6/25/97 "2-Outperform" $34.00 $1.78 $2.00 "Looking forward we believe a renewal of
Harriet C. Baldwin 17.0x 1998 acquisition activity - and a pickup in EPS
Baldwin EPS momentum - is coming. . . Historically,
estimate of acquisitions have been an important source of
$2.00 growth. We believe that the announcement of
a sizable acquisition (accretive)could be the
next catalyst for the shares. . . Year-to-date
shares have outperformed the brisk pace of
the market. . . We expect full year EPS at
$1.78, up 15% versus $1.55 in 1996 - and
compared to 9% EPS growth in 1996. We
anticipate revenue growth at Tiger to
accelerate to 12% in 1997, compared to 8% in
1996, driven by the 8% in 1996, once acquired
product lines reach Tiger standards."
</TABLE>
<TABLE>
Ownership Profile
<CAPTION>
Institutional Shares % of Insider Shares % of Options
Holdings Held Outstanding Holdings Held Outstanding Held
- ------------------------------ --------- ----------- ---------------- --------- ------------- -------
<S> <C> <C> <C> <C> <C> <C>
T. Rowe Price 3,975,000 9.6% Herbert S. Amster 22,500 0.05% 0
Fidelity 3,921,400 9.5 Brian P. Campbell 1,194,753 2.85 220,000
Cramer Rosenthal McGly 1,128,378 2.7 Peter C. DeChants 39,950 0.10 24,000
David L. Babson & Co. 989,040 2.4 William E. Meyers 59,907 0.14 15,189
First Chicago NBD Corp. 824,966 2.0 Douglas P. Roosa 6,320 0.02 0
Skyline Asset Mgmt. 530,500 1.3 Helmut F. Stern 500,000 1.23 0
Ohio St. Teachers Ret. Fund 500,000 1.2 ----------------- --------- ------ -------
Invista Capital Mgmt Inc. 421,500 1.0 Total 1,823,430 4.41% 259,189
Zurich Kemper Investments 400,000 1.0
First Pacific Advisors 391,769 0.9
Barclays Bank Plc 355,821 0.9 <CAPTION>
Dalton Greiner Hartman 262,900 0.6 Shares % of
Mellon Bank 234,014 0.6 Affiliate Holdings Held Outstanding
Wright Investors Service 222,900 0.5 --------------------- ----------- -----------
College Retirement Equities 196,100 0.5 <S> <C> <C>
Columbia Management Co. 170,000 0.4 Mustang Corp. 1,583,708 3.8%
Delaware Management Co. 147,000 0.4 Mustang 15,191,109 36.8
Putnam Investment Mgmt. 143,332 0.3 Richard A. Manoogian 1,801,852 4.4
Vanguard Group Inc. 124,100 0.3 --------------------- ---------- ----
First Manhattan Co. 119,950 0.3 Total 18,576,669 45.0%
Palisade Capital Mgmt. 116,848 0.3
Schwartz Investment Counsel 115,437 0.3
Bankers Trust NY Corp. 109,400 0.3
Pekin Singer & Shapiro 105,520 0.3 Recapitulation:
Geneva Capital Mgmt Lt. 103,000 0.2 --------------------
Welch & Forbes Inc. 87,970 0.2 Affiliate Holdings 18,576,669 45.0%
ANB Investment 71,780 0.2 Institutional Holdings 16,955,998 41.0
Conseco Inc. 68,000 0.2 Insider Holdings 1,823,430 4.4
Princor Management Corp. 61,100 0.1 Retail and Other 3,969,021 9.6
Wilshire Assoc. Inc. 58,700 0.1 ------------------------ ---------- -----
State Street Corp. 50,400 0.1 Total Shares Outstanding 41,325,118 100.0%
Others (Each holding less than
50,000 shares) 624,973 1.5
- ------------------------------ ---------- -----
Total 16,955,998 41.0%
</TABLE>
Liquidity Analysis of Tiger
Shares Outstanding 41,325,118
Float(a) 20,815,062
Adjusted Float(b) 9,976,278
Average Daily Trading Volume
30-day 29,968
60-day 27,423
90-day 28,502
180-day 30,324
Average Daily Turnover(c)
30-day 0.1%
60-day 0.1
90-day 0.1
180-day 0.1
Average Daily Adjusted Turnover(c)
30-day 0.3%
60-day 0.3
90-day 0.3
180-day 0.3
Number of Research Analysts 7
[ Graphic Omitted
Chart titled "TIGER 1 YEAR STOCK CHART
High-Low-Close & Volume"
was constructed using data from the table below ]
Volume High Low Close
05-Dec-96 9100 25 24.875 25
06-Dec-96 3800 24.875 24.5 24.5
09-Dec-96 800 24.625 24.5 24.625
10-Dec-96 33300 24.625 24.375 24.375
11-Dec-96 14500 24.25 24.125 24.25
12-Dec-96 3000 24.25 23.875 23.875
13-Dec-96 2000 23.75 23.625 23.75
16-Dec-96 9900 23.75 23.125 23.125
17-Dec-96 11100 23.375 23 23.25
18-Dec-96 10200 23.25 22.75 22.75
19-Dec-96 25000 23.125 22.625 23
20-Dec-96 9600 23.5 23 23.5
23-Dec-96 9200 23.375 22.625 22.625
24-Dec-96 9700 22.75 22.625 22.75
26-Dec-96 27700 23 22.75 22.875
27-Dec-96 76200 23.5 23 23.5
30-Dec-96 8100 23.625 23.375 23.5
31-Dec-96 8100 23.875 23.375 23.875
02-Jan-97 189200 23.875 23.75 23.875
03-Jan-97 148500 24.25 23.75 24.25
06-Jan-97 5600 24.375 24.125 24.125
07-Jan-97 56300 24.25 24.125 24.125
08-Jan-97 91700 24.125 23.75 23.875
09-Jan-97 89800 24 23.25 23.25
10-Jan-97 31800 23.375 22.875 23.375
13-Jan-97 26100 23.25 23 23.125
14-Jan-97 19800 23.25 23.125 23.25
15-Jan-97 21700 23 22.625 22.625
16-Jan-97 4000 23.125 22.625 22.875
17-Jan-97 130800 23 22.875 23
20-Jan-97 7200 22.875 22.75 22.875
21-Jan-97 138700 23.25 22.875 23.125
22-Jan-97 7000 23 22.875 22.875
23-Jan-97 2800 22.875 22.75 22.75
24-Jan-97 22200 22.75 22.375 22.5
27-Jan-97 11200 22.625 22.25 22.25
28-Jan-97 43900 22.5 22.25 22.25
29-Jan-97 25000 22.5 22 22
30-Jan-97 25700 22.25 22 22.25
31-Jan-97 23500 22.25 22.125 22.25
03-Feb-97 26000 22.75 22.125 22.5
04-Feb-97 56200 22.75 22.5 22.625
05-Feb-97 16100 22.875 22.625 22.875
06-Feb-97 46800 23.5 22.875 23.5
07-Feb-97 6400 23.375 23.25 23.375
10-Feb-97 24400 23.5 23.125 23.5
11-Feb-97 751500 24 23.625 23.875
12-Feb-97 32500 23.875 23.75 23.875
13-Feb-97 121500 23.875 23.75 23.875
14-Feb-97 113000 24 23.875 24
18-Feb-97 210800 24.75 23.875 24.75
19-Feb-97 81200 24.75 24.5 24.625
20-Feb-97 76700 24.625 24.5 24.625
21-Feb-97 93900 24.625 24.25 24.25
24-Feb-97 8900 24.375 24.125 24.25
25-Feb-97 56600 24.5 24.375 24.5
26-Feb-97 23000 24.5 24.25 24.5
27-Feb-97 11100 24.5 24.25 24.375
28-Feb-97 12200 24.375 24.125 24.375
03-Mar-97 97200 24.75 24.25 24.75
04-Mar-97 29000 24.75 24.625 24.75
05-Mar-97 120200 24.75 24.375 24.5
06-Mar-97 108200 24.625 24.5 24.5
07-Mar-97 117700 24.5 24.25 24.375
10-Mar-97 77100 24.75 24.25 24.75
11-Mar-97 45300 24.75 24.375 24.5
12-Mar-97 37500 24.5 24.375 24.375
13-Mar-97 23600 24.375 24 24
14-Mar-97 70700 24.125 24 24.125
17-Mar-97 32000 24 23.75 23.875
18-Mar-97 45500 24 23.75 23.75
19-Mar-97 59200 23.875 23.5 23.5
20-Mar-97 113600 23.875 23.375 23.375
21-Mar-97 184900 23.5 23.25 23.5
24-Mar-97 115300 23.625 23.375 23.5
25-Mar-97 146000 23.625 23.375 23.375
26-Mar-97 43900 23.625 23.5 23.5
27-Mar-97 70100 23.75 23.5 23.625
31-Mar-97 49200 23.5 23.125 23.5
01-Apr-97 33600 24.125 23.5 24.125
02-Apr-97 52000 24 23.625 23.75
03-Apr-97 144800 23.875 23.75 23.75
04-Apr-97 42000 23.875 23.625 23.875
07-Apr-97 40800 23.875 23.625 23.75
08-Apr-97 10100 23.875 23.75 23.875
09-Apr-97 75100 24 23.75 23.875
10-Apr-97 69100 23.875 23.375 23.375
11-Apr-97 4700 23.375 23.125 23.375
14-Apr-97 31700 23.25 22.75 23
15-Apr-97 158700 23.25 22.875 23
16-Apr-97 49100 23.375 22.75 23.125
17-Apr-97 41800 23.375 23.125 23.125
18-Apr-97 9200 23.375 23.125 23.125
21-Apr-97 9000 23.25 23 23.25
22-Apr-97 14100 23.5 23.125 23.5
23-Apr-97 24200 23.75 23 23.125
24-Apr-97 12100 23.5 23.25 23.5
25-Apr-97 3500 23.625 23.375 23.375
28-Apr-97 23500 24 23.375 24
29-Apr-97 15900 24.5 24 24.5
30-Apr-97 28300 24.625 24.25 24.625
01-May-97 31300 24.875 24.625 24.625
02-May-97 11300 25 24.625 25
05-May-97 29800 26.125 24.875 26
06-May-97 49200 27.125 26 26.375
07-May-97 21500 26.625 25.625 25.75
08-May-97 39500 26.125 25.5 25.5
09-May-97 41800 25.875 25.25 25.75
12-May-97 31200 26.5 25.875 26.5
13-May-97 13200 26.75 26.125 26.125
14-May-97 17100 26.5 26.25 26.5
15-May-97 7900 26.25 25.75 25.875
16-May-97 54300 26.25 25.875 26.25
19-May-97 11900 26.5 25.75 26.5
20-May-97 13800 26.875 26.375 26.75
21-May-97 11500 27.25 26.875 26.875
22-May-97 3800 27.625 27 27.625
23-May-97 35600 28.125 27.625 28.125
27-May-97 109000 28.375 27.875 28.375
28-May-97 14400 28.375 27.875 28.125
29-May-97 6100 28.125 27.875 28
30-May-97 32800 28.375 27.75 28.375
02-Jun-97 6300 28.375 28.25 28.375
03-Jun-97 58600 29.125 28.375 29
04-Jun-97 25200 28.875 28.625 28.75
05-Jun-97 38800 29 28.5 29
06-Jun-97 47400 29.125 28.875 29.125
09-Jun-97 54800 29.5 29.125 29.375
10-Jun-97 73600 29.5 28.875 29.5
11-Jun-97 5300 29.5 29.375 29.375
12-Jun-97 38100 29.375 29.125 29.375
13-Jun-97 32000 29.625 29.25 29.5
16-Jun-97 42100 30 29.5 30
17-Jun-97 64900 30.5 30 30.375
18-Jun-97 37500 30.625 30.375 30.5
19-Jun-97 62200 31 30.5 31
20-Jun-97 45200 30.625 29.875 29.875
23-Jun-97 15000 30 29.625 30
24-Jun-97 11900 29.875 29.375 29.625
25-Jun-97 46500 29.5 29.125 29.125
26-Jun-97 34800 29 28.188 28.313
27-Jun-97 58700 28.438 27.75 28.188
30-Jun-97 66900 28.125 27.875 28.125
01-Jul-97 23000 28.125 28 28.125
02-Jul-97 67600 28.625 27.625 28.5
03-Jul-97 55400 28.75 28.375 28.75
07-Jul-97 35800 29.25 28.875 29.25
08-Jul-97 49600 29.344 29.188 29.25
09-Jul-97 32100 29.438 29.25 29.375
10-Jul-97 37600 29.5 29.313 29.313
11-Jul-97 15800 29.438 29.25 29.375
14-Jul-97 25200 29.5 29.25 29.438
15-Jul-97 63900 29.438 29.313 29.438
16-Jul-97 34200 29.625 29.375 29.563
17-Jul-97 22600 29.563 29.5 29.563
18-Jul-97 36900 29.563 29.25 29.563
21-Jul-97 7900 29.438 29.25 29.313
22-Jul-97 7800 29.313 29.25 29.313
23-Jul-97 17000 29.313 29.25 29.313
24-Jul-97 16200 29.25 29 29.25
25-Jul-97 3400 29.25 29.125 29.188
28-Jul-97 29400 29.313 29.063 29.313
29-Jul-97 2900 29.25 29.063 29.063
30-Jul-97 23500 29.25 29 29.25
31-Jul-97 20200 29.25 29.125 29.188
01-Aug-97 67600 29.375 29.063 29.375
04-Aug-97 37600 29.375 29.188 29.375
05-Aug-97 43500 29.625 29.375 29.438
06-Aug-97 4600 29.438 29.188 29.188
07-Aug-97 18000 29.25 28.75 29.25
08-Aug-97 21200 29.25 28.313 28.625
11-Aug-97 16200 28.625 28 28.625
12-Aug-97 44100 29 28.688 28.75
13-Aug-97 17900 28.75 28.5 28.5
14-Aug-97 12500 28.438 28.25 28.375
15-Aug-97 28400 28 27.25 27.25
18-Aug-97 48500 28 27.063 28
19-Aug-97 34100 28.125 27.75 27.875
20-Aug-97 14000 28.25 27.875 28.188
21-Aug-97 11600 28.563 28.25 28.25
22-Aug-97 35200 28.063 27.75 28.063
25-Aug-97 6900 28.125 28.063 28.125
26-Aug-97 18800 28.813 28.188 28.813
27-Aug-97 28500 28.875 28.625 28.688
28-Aug-97 29400 28.75 28.313 28.438
29-Aug-97 40000 28.625 28.5 28.625
02-Sep-97 39600 28.5 28.25 28.375
03-Sep-97 15900 28.25 27.813 28.188
04-Sep-97 21400 28.375 28.125 28.188
05-Sep-97 59000 28.25 28 28.125
08-Sep-97 8100 28.375 28.063 28.188
09-Sep-97 94800 28.5 28.063 28.5
10-Sep-97 6700 28.5 28.125 28.188
11-Sep-97 111700 28.5 28 28.5
12-Sep-97 33100 30.5 28.438 30.375
15-Sep-97 62300 30.375 30.25 30.313
16-Sep-97 17700 30.438 30.313 30.375
17-Sep-97 38800 30.5 30.188 30.25
18-Sep-97 2500 30.5 30.375 30.375
19-Sep-97 10500 30.438 30.188 30.188
22-Sep-97 18400 31.563 30.188 30.375
23-Sep-97 15900 30.688 30.313 30.375
24-Sep-97 18400 30.75 30.25 30.563
25-Sep-97 40400 30.625 30.25 30.563
26-Sep-97 12400 30.75 30.5 30.75
29-Sep-97 3800 30.813 30.625 30.813
30-Sep-97 13600 30.625 30.438 30.5
01-Oct-97 24300 31 30.5 31
02-Oct-97 24300 31.563 30.688 30.938
03-Oct-97 29300 31 30.938 31
06-Oct-97 12600 30.938 30.75 30.938
07-Oct-97 22000 30.625 30.313 30.375
08-Oct-97 58500 30.25 29.625 30.125
09-Oct-97 15200 30.125 30 30
10-Oct-97 45800 30.188 29.875 30.063
13-Oct-97 4500 30 29.938 30
14-Oct-97 37700 30 29.813 29.875
15-Oct-97 25500 30 29.813 30
16-Oct-97 27200 30.438 29.875 30.438
17-Oct-97 47300 30.438 30 30.063
20-Oct-97 30500 30.063 30 30
21-Oct-97 42700 30.188 29.875 30.125
22-Oct-97 14600 30.063 29.938 30.063
23-Oct-97 18900 30 29.813 30
24-Oct-97 20100 30.063 29.938 30
27-Oct-97 35400 30 29.5 29.5
28-Oct-97 30800 28.938 28.375 28.813
29-Oct-97 4200 28.813 28.625 28.75
30-Oct-97 9800 28.813 28.5 28.813
31-Oct-97 19200 29.313 29.188 29.25
03-Nov-97 15500 29.5 28.75 29.125
04-Nov-97 9300 29.375 28.75 29.375
05-Nov-97 7600 29.563 29.313 29.563
06-Nov-97 26100 30.188 29.625 30.125
07-Nov-97 71500 30 29.188 29.25
10-Nov-97 24100 29.5 28.938 29.438
11-Nov-97 1900 29.438 29.313 29.313
12-Nov-97 53800 30.188 29.063 29.75
13-Nov-97 29400 29 28.563 29
14-Nov-97 3900 29.625 29.063 29.563
17-Nov-97 12000 30 29.688 30
18-Nov-97 8900 30.125 29.938 30.125
19-Nov-97 1300 30.125 30.125 30.125
20-Nov-97 42900 30.125 30 30.125
21-Nov-97 110900 30.188 29.938 30
24-Nov-97 9800 29.875 29.563 29.625
25-Nov-97 9100 30.188 29.375 30.188
26-Nov-97 53200 30.688 30.125 30.688
28-Nov-97 35900 31 30.688 31
01-Dec-97 59600 31.563 31.125 31.5
02-Dec-97 2300 31.75 31.563 31.563
03-Dec-97 45600 31.813 31.625 31.625
04-Dec-97 1200 31.5 31.375 31.375
05-Dec-97 48300 31.375 31 31.125
<TABLE>
<CAPTION>
Divestiture Days Required Based on 25% of
% % Current Average Daily Trading Volume
Institutional Investors Float Outstanding Holdings 30-Day 60-Day 90-Day 180-Day
- ----------------------------- -------- ----------- -------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
T. Rowe Price 19.1% 9.5% 3,975,000 530.6 579.8 557.9 524.3
Fidelity 18.8 9.6 3,921,400 523.4 572.0 550.3 517.3
Cramer Rosenthal McGly 5.4 2.7 1,128,378 150.6 164 6 158.4 148.8
David L. Babson & Co. 4.8 2.4 989,040 132.0 144.3 138.8 130.5
First Chicago NBD 4.0 2.0 824,966 110.1 120.3 115.8 108.8
Skyline Asset Management 2.5 1.3 530,500 70.8 77.4 74.5 70.0
Ohio State Teachers Retirement 2.4 1.2 500,000 66.7 72.9 70.2 66.0
Fund
Invista Capital Management 2.0 1.0 421,500 56.3 61.5 59.2 55.6
Zurich Kemper Investments, Inc. 1.9 1.0 400,000 53.4 58.3 56.1 52.8
First Pacific Advisors 1.9 0.9 391,769 52.3 57.1 55.0 51.7
----- ----- ----------
62.9% 31.7% 13,082,553
- --------------------
Note: Share price data through December 5, 1997.
(a) Float represents shares outstanding, less Mustang, Mustang Corp., management and director holdings.
(b) Adjusted Float represents Float less five largest institutional investors.
(c) Average Daily Turnover = Avg. Daily Trading Volume/Float.
(d) Adjusted Daily Turnover = Avg. Daily Trading Volume/Adjusted Float.
</TABLE>
<PAGE>
III. VALUATION ANALYSIS
<PAGE>
[ Graphic Omitted
Chart titled "Selected Public Company Analysis Summary
Implied Tiger Share Price (a)"
was constructed using data from the table below ]
- --------------------
(a) LTM results through September 30, 1997. Composite group includes
Aeroquip-Vickers, Inc., Barnes Group Incorporated, Blount
International, Inc., Cincinnati Milacron Inc., Cooper Industries,
Danaher Corporation, Dover Corporation, Federal Signal Corporation,
GenCorp Inc., Illinois Tool Works, Kaydon Corporation, Mark IV
Industries, Pentair Inc., Regal-Beloit Corporation and Teleflex Inc.
<TABLE>
Selected Public Company Analysis Summary
<CAPTION>
Tiger
Tiger Transaction Publicly Traded Company Multiples Implied Equity Valuation (Per Share)(b)
Results Multiples at ------------------------------------- ----------------------------------------
(mm) Offer Price Mean Median Range Mean Median Range
------- ------------ -------- -------- -------------- -------- -------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
LTM Revenues $658.4 2.1x 1.5x 1.4x 0.8x - 3.4x $24.91 $23.33 $13.89 - $54.81
LTM EBITDA 138.4 10.0 9.0 8.5 6.2 - 13.6 31.08 29.43 21.82 - 46.30
LTM EBIT 113.3 12.2 11.8 11.3 8.5 - 16.7 33.25 31.90 24.32 - 46.52
LTM Net Income 70.1 20.5 17.2 15.7 12.2 - 24.9 28.83 26.32 20.45 - 41.74
1997E EPS 1.76 19.6 17.3 16.3 12.7 - 23.9 30.45 28.69 22.35 - 42.06
1998E EPS 1.92 18.0 15.2 14.4 11.5 - 21.6 29.18 27.65 22.08 - 41.47
Book Value 541.4 2.7 3.4 3.3 2.0 - 5.2 44.00 42.71 25.89 - 67.30
- ---------------------
(a) LTM results through September 30, 1997.
(b) Includes net cash of $54.3 million; 41.8 million fully diluted shares. See Appendix for Public Company
Transaction Analysis.
</TABLE>
[ Graphic Omitted
Chart titled "Selected Precedent Transactions Summary
Implied Tiger Share Price"
was constructed using data from the table on the following page ]
- --------------------
(a) LTM results through September 30, 1997. See Appendix for Analysis of
Selected Precedent Transactions.
<TABLE>
Selected Precedent Transactions
<CAPTION>
Tiger
Tiger Transaction Precedent Transation Multiples Implied Equity Valuation (Per Share)(b)
Results Multiples at ------------------------------------- -----------------------------------------
(mm) Offer Price Mean Median Range Mean Median Range
------- ------------ -------- -------- ---------------- -------- -------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
LTM Revenues $658.4 2.1x 1.3x 1.1x 0.7x - 3.3x $21.76 $18.61 $12.32 - $53.24
LTM EBITDA 138.4 10.0 9.3 8.7 7.1 - 14.8 32.07 30.09 24.79 - 50.28
LTM EBIT 113.3 12.2 12.6 12.4 9.1 - 16.3 35.42 34.88 25.94 - 45.44
LTM Net Income 70.1 20.5 19.0 17.5 12.7 - 26.8 31.85 29.33 21.29 - 44.92
Book Value 541.4 2.7 3.0 2.4 1.6 - 5.7 38.83 31.06 20.71 - 73.77
- ---------------------
(a) LTM results through September 30, 1997.
(b) Includes net cash of $54.3 million; 41.8 million fully diluted shares. See Appendix for Selected Precedent Transaction
Analysis.
</TABLE>
<TABLE>
Summary Discounted Cash Flow Analysis
<CAPTION>
Per Share Value Range
-------------------------------------------------------
Terminal Value Method Perpetuity Growth Method
--------------------- ------------------------
<S> <C> <C>
Results:
Case One $32.96 - $42.11 $25.80 - $41.68
Case Two 29.51 - 37.57 22.80 - 36.43
<CAPTION>
1994 Actual - 1997 Est. Case One 1997 - 2002 Case Two 1997 - 2002
------------------------- ---------------------- ----------------------
<S> <C> <C> <C>
Assumptions:
Revenue Growth 7.5% 7.5% 7.5%
Operating Income (EBIT) Growth 8.2% 10.8% 7.5%
EBIT Margin % 17.4% 20.2% (2002) 17.4% (2002)
Case One: Tiger management five-year projections.
Case Two: Tiger management five-year projections, adjusted for constant EBIT margin assumption per discussions
with the Oversight Committee.
</TABLE>
<TABLE>
DISCOUNTED CASH FLOW ANALYSIS BT WOLFENSOHN
Project Motown
(In Thousands Except Per Share Amounts)
CASE 1
<CAPTION>
1998 1999 2000 2001 2002
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Cash Provided by Operations
Earnings Before Interest and Taxes (EBIT) $124,899.0 $139,668.0 $158,477.0 $175,569.0 $193,132.0
Taxes @ 38.0% (48,449.6) (54,061.8) (61,209.3) (67,704.2) (74,378.2)
Unlevered Net Income $76,449.4 $85,606.2 $97,267.7 $107,864.8 $118,753.8
+Depreciation and Amortization $27,765.0 $33,341.0 $34,629.0 $31,057.0 $30,603.0
+Change in Deferred Taxes 2,000.0 2,000.0 2,000.0 2,000.0 2,000.0
+After-tax Proceeds from Asset Sales 0.0 0.0 0.0 0.0 0.0
-Net Additions to Property, Plant and Equipment (37,222.0) (37,795.0) (35,095.0) (29,997.0) (30,121.0)
-Net Change in Non-cash Working Capital (4,242.9) (1,873.3) (8,305.9) (6,120.9) (5,183.4)
Total Cash Flow Provided By Operations $64,749.5 $81,278.8 $90,495.9 $104,803.8 $116,052.4
Unlevered Operating Free Cash Flow After-tax $64,749.5 $81,278.8 $90,495.9 $104,803.8 $116,052.4
Earnings Before Interest, Taxes, Depreciation
& Amortization (EBITDA) 152,664.0 173,009.0 193,106.0 206,626.0 223,735.0
Terminal Value at 8.0x EBITDA --- --- --- --- $1,789,880.0
Terminal Value at 9.0x EBITDA --- --- --- --- 2,013,615.0
Terminal Value at 10.0x EBITDA --- --- --- --- 2,237,350.0
Five Year Net Free Cash Flows at 8.0x EBITDA $64,749.5 $81,278.8 $90,495.9 $104,803.8 $1,905,932.4
Net Free Cash Flows at 9.0x EBITDA 64,749.5 81,278.8 90,495.9 104,803.8 2,129,667.4
Net Free Cash Flows at 10.0x EBITDA 64,749.5 81,278.8 90,495.9 104,803.8 2,353,402.4
<CAPTION>
Perpetuity Method Terminal Value
- ------------------------------------
<S> <C> <C> <C>
10.5% 11.5% 12.5%
3.0% $1,593,786.4 $1,406,282.1 $1,258,252.4
4.0% 1,856,838.6 1,609,260.1 1,419,935.4
5.0% 2,215,546.0 1,874,692.8 1,624,733.7
</TABLE>
<TABLE>
<CAPTION>
FIVE YEAR NET PRESENT VALUE ANALYSIS
TERMINAL EXIT VALUE METHOD ENTERPRISE EQUITY PER
VALUE VALUE (a) SHARE
<S> <C> <C> <C> <C>
NPV @ 10.5% $1,419,431.3 $1,489,755.1 $35.61
8.0x EBITDA NPV @ 11.5% $1,362,483.9 $1,432,807.7 $34.25
NPV @ 12.5% $1,308,419.2 $1,378,743.0 $32.96
NPV @ 10.5% $1,555,238.5 $1,625,562.3 $38.86
9.0x EBITDA NPV @ 11.5% $1,492,309.2 $1,562,633.0 $37.36
NPV @ 12.5% $1,432,576.2 $1,502,900.0 $35.93
NPV @ 10.5% $1,691,045.6 $1,761,369.4 $42.11
10.0x EBITDA NPV @ 11.5% $1,622,134.6 $1,692,458.4 $40.46
NPV @ 12.5% $1,556,733.2 $1,627,057.0 $38.90
</TABLE>
<TABLE>
<CAPTION>
FIVE YEAR NET PRESENT VALUE ANALYSIS
ENTERPRISE EQUITY PER
PERPETUITY VALUE METHOD VALUE VALUE (a) SHARE
<S> <C> <C> <C> <C>
NPV @ 10.5% $1,300,402.6 $1,366,157.6 $32.66
3.0% Growth Rate NPV @ 11.5% $1,139,895.8 $1,205,650.8 $28.82
NPV @ 12.5% $1,013,403.6 $1,079,158.6 $25.80
NPV @ 10.5% $1,460,075.2 $1,525,830.2 $36.48
4.0% Growth Rate NPV @ 11.5% $1,257,676.6 $1,323,431.6 $31.64
NPV @ 12.5% $1,103,126.2 $1,168,881.2 $27.94
NPV @ 10.5% $1,677,810.6 $1,743,565.6 $41.68
5.0% Growth Rate NPV @ 11.5% $1,411,697.7 $1,477,452.7 $35.32
NPV @ 12.5% $1,216,774.7 $1,282,529.7 $30.66
</TABLE>
<TABLE>
DISCOUNTED CASH FLOW ANALYSIS BT WOLFENSOHN
Project Motown
(In Thousands Except Per Share Amounts)
CASE 2
<CAPTION>
1998 1999 2000 2001 2002
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Cash Provided by Operations
Earnings Before Interest and Taxes (EBIT) $124,899.0 $133,808.7 $145,068.9 $155,514.7 $166,390.5
Taxes @ 38.0% (48,449.6) (51,835.3) (56,114.2) (60,083.6) (64,216.4)
Unlevered Net Income $76,449.4 $81,973.4 $88,954.7 $95,431.1 $102,174.1
+Depreciation and Amortization $27,765.0 $33,341.0 $34,629.0 $31,057.0 $30,603.0
+Change in Deferred Taxes 2,000.0 2,000.0 2,000.0 2,000.0 2,000.0
+After-tax Proceeds from Asset Sales 0.0 0.0 0.0 0.0 0.0
-Net Additions to Property, Plant
and Equipment (37,222.0) (37,795.0) (35,095.0) (29,997.0) (30,121.0)
-Net Change in Non-cash Working Capital (4,242.9) (1,873.3) (8,305.9) (6,120.9) (5,183.4)
Total Cash Flow Provided By Operations $64,749.5 $77,646.0 $82,182.8 $92,370.2 $99,472.7
Unlevered Operating Free Cash Flow After-tax $64,749.5 $77,646.0 $82,182.8 $92,370.2 $99,472.7
Earnings Before Interest, Taxes, Depreciation
& Amortization (EBITDA) 152,664.0 167,149.7 179,697.9 186,571.7 196,993.5
Terminal Value at 8.0x EBITDA --- --- --- --- $1,575,948.1
Terminal Value at 9.0x EBITDA --- --- --- --- 1,772,941.6
Terminal Value at 10.0x EBITDA --- --- --- --- 1,969,935.1
Five Year Net Free Cash Flows at 8.0x EBITDA $64,749.5 $77,646.0 $82,182.8 $92,370.2 $1,675,420.7
Net Free Cash Flows at 9.0x EBITDA 64,749.5 77,646.0 82,182.8 92,370.2 1,872,414.3
Net Free Cash Flows at 10.0x EBITDA 64,749.5 77,646.0 82,182.8 92,370.2 2,069,407.8
<CAPTION>
Perpetuity Method Terminal Value
- --------------------------------
<S> <C> <C> <C>
10.5% 11.5% 12.5%
3.0% $1,366,091.5 $1,205,374.9 $1,078,493.3
4.0% 1,591,563.0 1,379,354.6 1,217,077.6
5.0% 1,899,024.0 1,606,866.5 1,392,617.6
</TABLE>
<TABLE>
<CAPTION>
FIVE YEAR NET PRESENT VALUE ANALYSIS
TERMINAL EXIT VALUE METHOD ENTERPRISE EQUITY PER
VALUE VALUE (a) SHARE
<S> <C> <C> <C> <C>
NPV @ 10.5% $1,262,034.6 $1,332,358.4 $31.85
8.0 x EBITDA NPV @ 11.5% $1,211,762.6 $1,282,086.4 $30.65
NPV @ 12.5% $1,164,030.4 $1,234,354.2 $29.51
NPV @ 10.5% $1,381,609.6 $1,451,933.4 $34.71
9.0 x EBITDA NPV @ 11.5% $1,326,070.9 $1,396,394.7 $33.38
NPV @ 12.5% $1,273,347.8 $1,343,671.6 $32.12
NPV @ 10.5% $1,501,184.6 $1,571,508.4 $37.57
10.0 x EBITDA NPV @ 11.5% $1,440,379.1 $1,510,702.9 $36.11
NPV @ 12.5% $1,382,665.2 $1,452,989.0 $34.73
</TABLE>
<TABLE>
<CAPTION>
FIVE YEAR NET PRESENT VALUE ANALYSIS
ENTERPRISE EQUITY PER
PERPETUITY VALUE METHOD VALUE VALUE (a) SHARE
<S> <C> <C> <C> <C>
NPV @ 10.5% $1,134,651.7 $1,200,406.7 $28.70
3.0% Growth Rate NPV @ 11.5% $996,732.3 $1,062,487.3 $25.40
NPV @ 12.5% $887,978.4 $953,733.4 $22.80
NPV @ 10.5% $1,271,512.8 $1,337,267.8 $31.97
4.0% Growth Rate NPV @ 11.5% $1,097,686.5 $1,163,441.5 $27.81
NPV @ 12.5% $964,882.8 $1,030,637.8 $24.64
NPV @ 10.5% $1,458,141.6 $1,523,896.6 $36.43
5.0% Growth Rate NPV @ 11.5% $1,229,703.4 $1,295,458.4 $30.97
NPV @ 12.5% $1,062,295.0 $1,128,050.0 $26.97
</TABLE>
<TABLE>
Project Motown BT WOLFENSOHN
Assumptions Discounted Cash Flow Analysis
CASE 1 (In Thousands Except Per Share Amounts)
<CAPTION>
HISTORICAL FISCAL YEAR ENDED December 31,
-------------------------------------------------------------
1994 1995 1996 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Sales $535,480.0 $553,491.0 $600,230.0 $664,983.0
% Growth 20.8% 3.4% 8.4% 10.8%
Gross Profit 173,960.0 182,021.0 196,850.0 216,932.0
Margin % 32.5% 32.9% 32.8% 32.6%
EBITDA 111,980.0 120,161.0 127,220.0 141,704.0
Margin % 20.9% 21.7% 21.2% 21.3%
EBIT 91,400.0 98,681.0 104,290.0 115,729.0
Margin % 17.1% 17.8% 17.4% 17.4%
EBITA(1) 93,470.0 100,661.0 106,430.0 118,279.0
Margin % 17.5% 18.2% 17.7% 17.8%
Cash Taxes(2) 38.00% (35,518.6) (38,251.2) (40,443.4) (44,946.0)
Unlevered Net Income 55,881.4 60,429.8 63,846.6 70,783.0
Depreciation & Amortization(3) 20,580.0 21,480.0 22,930.0 25,975.0
% of Sales 3.8% 3.9% 3.8% 3.9%
Amortization 5,350.0 5,040.0 5,280.0 6,200.0
% of Sales 1.0% 0.9% 0.9% 0.9%
Non-Deductible 2,070.0 1,980.0 2,140.0 2,550.0
Capital Expenditures 24,310.0 23,470.0 54,160.0 45,156.0
% of Sales 4.5% 4.2% 9.0% 6.8%
Working Capital 100,180.0 105,070.0 97,550.0 115,976.0
% of Sales 18.7% 19.0% 16.3% 17.4%
Growth % 4.9% 7.2% 18.9%
Fully Diluted Shares: (000s)(4) 41,831.2
Net Debt @ 12/31/97 ($65,755.0)
Cash Proceeds from Options $4,568.8
<CAPTION>
PROJECTED FISCAL YEAR ENDED December 31,
---------------------------------------------------------------------
1998 1999 2000 2001 2002
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Sales $716,480.0 $767,590.0 $832,184.0 $892,106.0 $954,495.0
% Growth 7.7% 7.1% 8.4% 7.2% 7.0%
Gross Profit 236,079.0 256,421.0 280,999.0 304,028.0 328,293.0
Margin % 32.9% 33.4% 33.8% 34.1% 34.4%
EBITDA 152,664.0 173,009.0 193,106.0 206,626.0 223,735.5
Margin % 21.3% 22.5% 23.2% 27.7% 23.4%
EBIT 124,899.0 139,668.0 158,447.0 175,569.0 193,132.0
Margin % 17.4% 18.2% 19.0% 19.7% 20.2%
EBITA(1) 127,499.0 142,268.0 161,077.0 178,169.0 195,732.0
Margin % 17.8% 18.5% 19.4% 20.0% 20.5%
Cash Taxes(2) 38.00% (48,449.6) (54,061.8) (61,209.3) (67,704.2) (74,328.2)
Unlevered Net Income 76,449.4 85,606.2 97,267.7 107,864.8 118,753.8
Depreciation & Amortization(3) 27,765.0 33,341.0 34,629.0 31,057.0 30,603.0
% of Sales 3.9% 4.3% 4.2% 3.5% 3.2%
Amortization 6,250.0 6,150.0 6,150.0 6,150.0 6,150.0
% of Sales 0.9% 0.8% 0.7% 0.7% 0.6%
Non-Deductible 2,600.0 2,600.0 2,600.0 2,600.0 2,600.0
Capital Expenditures 37,222.0 37,950.0 35,095.0 29,997.0 30,121.0
% of Sales 5.2% 4.9% 4.2% 3.4% 3.2%
Working Capital 120,218.9 122,092.2 130,398.1 136,519.0 141,702.5
% of Sales 16.8% 15.9% 15.7% 15.3% 14.8%
Growth % 3.7% 1.6% 6.8% 4.7% 3.8%
<FN>
- ------------
(1) EBITA equals earnings before interest and non-deduction amortization.
(2) Cash tax is based on the effective tax rate of 38%.
(3) Depreciation and Amortization includes both deductible and non-deductible
amortization.
(4) Includes 506,047 shares held under option. Cash proceeds from options
equals $4,568,805.
</TABLE>
<TABLE>
Project Motown BT WOLFENSOHN
Assumptions Discounted Cash Flow Analysis
CASE 2 (In Thousands Except Per Share Amounts)
<CAPTION>
HISTORICAL FISCAL YEAR ENDED December 31,
-------------------------------------------------------------
1994 1995 1996 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Sales $535,480.0 $553,491.0 $600,230.0 $664,983.0
% Growth 20.8% 3.4% 8.4% 10.8%
Gross Profit 173,960.0 182,021.0 196,850.0 216,932.0
Margin % 32.5% 32.9% 32.8% 32.6%
EBITDA 111,980.0 120,161.0 127,220.0 141,704.0
Margin % 20.9% 21.7% 21.2% 21.3%
EBIT 91,400.0 98,681.0 104,290.0 115,729.0
Margin % 17.1% 17.8% 17.4% 17.4%
EBITA(1) 93,470.0 100,661.0 106,430.0 118,279.0
Margin % 17.5% 18.2% 17.7% 17.8%
Cash Taxes(2) 38.00% (35,518.6) (38,251.2) (40,443.4) (44,946.0)
Unlevered Net Income 55,881.4 60,429.8 63.846.6 70,783.0
Depreciation & Amortization(3) 20,580.0 21,480.0 22,930.0 25,975.0
% of Sales 3.8% 3.9% 3.8% 3.9%
Amortization 5,350.0 5,040.0 5,280.0 6,200.0
% of Sales 1.0% 0.9% 0.9% 0.9%
Non-Deductible 2,070.0 1,980.0 2,140.0 2,550.0
Capital Expenditures 24,310.0 23,470.0 54,160.0 45,156.0
% of Sales 4.5% 4.2% 9.0% 6.8%
Working Capital 100,180.0 105,070.0 97,550.0 115,976.0
% of Sales 18.7% 19.0% 16.3% 17.4%
Growth % 4.9% 7.2% 18.9%
Fully Diluted Shares: (000s)(4) 41,831.2
Net Debt @ 12/31/97 ($65,755.0)
Cash Proceeds from Options $4,568.8
<CAPTION>
PROJECTED FISCAL YEAR ENDED December 31,
------------------------------------------------------------------
1998 1999 2000 2001 2002
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Sales $716,480.0 $767,590.0 $832,184.0 $892,106.0 $954,495.0
% Growth 7.7% 7.1% 8.4% 7.2% 7.0%
Gross Profit 236,079.0 256,421.0 280,999.0 304,028.0 328,293.0
Margin % 32.9% 33.4% 33.8% 34.1% 34.4%
EBITDA 152,664.0 173,009.0 193,106.0 206,626.0 223,735.5
Margin % 21.3% 22.5% 23.2% 27.7% 23.4%
EBIT 124,899.0 139,668.0 158,477.0 175,569.0 193,132.0
Margin % 17.4% 18.2% 19.0% 19.7% 20.2%
EBITA(1) 127,499.0 136,408.7 147,668.9 158,114.7 168,990.5
Margin % 17.8% 17.8% 17.7% 17.7% 17.7%
Cash Taxes(2) 38.00% (48,449.6) (51,835.3) (56,114.2) (60,083.6) (64,216.4)
Unlevered Net Income 76,449.4 81,973.4 88,954.7 95,431.1 102,174.1
Depreciation & Amortization(3) 27,765.0 33,341.0 34,629.0 31,057.0 30,603.0
% of Sales 3.9% 4.3% 4.2% 3.5% 3.2%
Amortization 6,250.0 6,150.0 6,150.0 6,150.0 6,150.0
% of Sales 0.9% 0.8% 0.7% 0.7% 0.6%
Non-Deductible 2,600.0 2,600.0 2,600.0 2,600.0 2,600.0
Capital Expenditures 37,222.0 37,950.0 35,095.0 29,997.0 30,121.0
% of Sales 5.2% 4.9% 4.2% 3.4% 3.2%
Working Capital 120,218.9 122,092.2 130,398.1 136,519.0 141,702.5
% of Sales 16.8% 15.9% 15.7% 15.3% 14.8%
Growth % 3.7% 1.6% 6.8% 4.7% 3.8%
<FN>
- ------------
(1) EBITA equals earnings before interest and non-deduction amortization.
(2) Cash tax is based on the effective tax rate of 38%.
(3) Depreciation and Amortization includes both deductible and non-deductible
amortization.
(4) Includes 506,047 shares held under option. Cash proceeds from options
equals $4,568,805.
</TABLE>
<PAGE>
IV. PRO FORMA COMBINATION ANALYSIS
<PAGE>
<TABLE>
Pro Forma Combination Analysis
Pro Forma Mustang Balance Sheet as of 12/31/97
($ in millions)
<CAPTION>
Transaction Mustang
Tiger(a) Mustang(a) Adjustments Pro Forma
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Assets
Cash $61.4 $25.0 ($15.6)(b) $70.8
Other Current Assets 182.0 245.2 427.2
------ -------- ----------- --------
Total Current Assets 243.4 270.2 498.0
Fixed Assets 202.7 411.5 614.2
Investments 5.2 296.3 (139.2)(c) 162.3
Intangible Assets 176.1 117.6 470.1 (d) 763.8
Other Assets 35.7 20.0 6.6 (e) 62.3
------ -------- ----------- --------
Total Assets $663.1 $1,115.6 321.9 $2,100.6
====== ======== =========== ========
Liabilities and Stockholders' Equity
Accounts Payable $29.2 $52.7 $81.9
Other Current Liabilities 35.8 84.7 120.5
------ -------- ----------- --------
Total Current Liabilities 65.0 137.4 202.4
Existing Debt -- 520.2 (210.2)(f) 310.0
Acquisition Debt -- -- 1,095.2 (g) 1,095.2
Other Liabilities 44.5 183.2 (39.0)(h) 188.7
------ -------- ----------- --------
Total Liabilities 109.5 841.0 846.3 1,796.8
Common Equity 553.6 274.6 (524.4)(i) 304.8
------ -------- ----------- --------
Total Liabilities and Stockholders' Equity $663.1 $1,115.6 321.9 $2,100.6
====== ======== =========== ========
- --------------------
(a) From company projections received from Tiger and Mustang, respectively. For Tiger, cash is shown net of debt balances.
(b) Assumed use of excess cash to finance transaction.
(c) Reversal of carrying value of Tiger investment held by Mustang.
(d) Net additional transaction goodwill calculated as adjusted purchase price less deferred tax of $39.0 million and adjusted
book value not already held by Mustang.
(e) Deferred of financing fees.
(f) Assumes Mustang refinances existing bank debt with acquisition debt. Mustang to keep $310 million convertible subordinated
notes outstanding.
(g) Acquisition debt, including refinancing of existing bank debt.
(h) Reversal of deferred tax liability.
(i) Elimination of Tiger equity; net of shares issued in rollover of Tiger stock award plan.
</TABLE>
<TABLE>
Pro Forma Combination Analysis
Pro Forma Mustang Income Statements and Cash Flow Summary
($ in millions)
<CAPTION>
For years ended December 31,(a)
----------------------------------------------------------------
1998 1999 2000 2001 2002
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Revenue $1,691.5 $1,842.6 $2,007.2 $2,125.9 $2,249.9
EBITDA 322.2 360.2 396.8 420.3 447.9
EBIT 234.2 264.9 298.6 324.2 350.8
Net Income $96.7 $119.5 $146.4 $167.3 $190.1
======== ======== ======== ======== ========
Capital Expenditures 97.2 82.8 83.0 73.2 75.5
Depreciation and Amortization 88.0 95.3 98.2 96.1 97.1
Revenue Growth 7.3% 7.3% 7.3% 7.3% 7.3%
EBITDA Margin 19.0% 19.5% 19.8% 19.8% 19.9%
EBIT Margin 13.8% 14.4% 14.9% 15.3% 15.6%
Net Income Margin 5.7% 6.5% 7.3% 7.9% 8.5%
- --------------------
Source: Management projections for Tiger, Mustang, respectively.
</TABLE>
<TABLE>
Pro Forma Combination Analysis
Pro Forma Balance Sheets
($ in millions)
<CAPTION>
Projected as of December 31,
---------------------------------------------------------------------
1998 1999 2000 2001 2002
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Assets
Cash $25.0 $25.0 $25.0 $25.0 $25.0
Other Current Assets 447.7 470.4 513.8 539.9 568.8
-------- -------- -------- -------- --------
Total Current Assets 472.7 495.4 538.8 564.9 593.8
Fixed Assets 652.9 669.7 683.9 690.3 697.9
Investments 173.9 187.4 197.6 214.3 219.4
Intangible Assets 770.2 746.5 724.4 702.4 680.3
Other Assets 62.6 54.9 56.9 58.8 60.7
-------- -------- -------- -------- --------
Total Assets $2,132.2 $2,154.0 $2,201.8 $2,230.7 $2,252.1
======== ======== ======== ======== ========
Liabilities and Stockholders' Equity
Accounts Payable $87.1 $92.5 $102.1 $103.0 $115.6
Other Current Liabilities 127.6 135.6 148.0 156.0 163.9
-------- -------- -------- -------- --------
Total Current Liabilities 214.6 228.2 250.1 259.0 279.5
Acquisition Debt 1,000.4 888.5 767.1 619.1 430.8
Convertible Subordinated Debt 310.0 310.0 310.0 310.0 310.0
Other Liabilities 196.8 218.3 241.0 264.5 287.6
-------- -------- -------- -------- --------
Total Liabilities 1,721.9 1,644.9 1,568.2 1,452.6 1,307.9
Common Equity 410.3 509.1 633.6 778.0 944.2
-------- -------- -------- -------- --------
Total Liabilities and Stockholders' Equity $2,132.2 $2,154.0 $2,201.8 $2,230.7 $2,252.1
======== ======== ======== ======== ========
- ---------------------
Source: Management projections for Tiger, Mustang, respectively.
</TABLE>
<TABLE>
Pro Forma Transaction Analysis
Pro Forma Capitalization and Coverage Analysis
($ in millions)
<CAPTION>
Projected(a)
----------------------------------------------------------------------------------
At Close 1998 1999 2000 2001 2002
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Total Senior/Bank Debt $1,095.2 $1,000.1 $888.2 $766.8 $618.8 $430.5
Total Debt (incl. Convertible debt) 1,405.2 1,310.1 1,198.2 1,076.8 928.8 740.5
Total Senior Bank Debt/EBITDA 3.9x 3.1x 2.5x 1.9x 1.5x 1.0x
Total Debt (incl. Convertible debt)/EBITDA 5.0x 4.1x 3.3x 2.7x 2.2x 1.7x
Total Interest Expense $90.8 $84.0 $75.4 $66.9 $56.6
EBITDA/Interest Expense 3.5x 4.3x 5.3x 6.3x 7.9x
EBITDA - CapEx/Interest Expense 2.5x 3.3x 4.2x 5.2x 6.6x
Debt/Equity/Ratio (Pre-Convert) 4.6x 3.4x 2.5x 1.8x 1.2x 0.8x
(Post-Convert) 1.8x 1.4x 1.1x 0.8x 0.6x 0.4x
Debt/Total Cap. (Pre-Convert) 82.2% 77.4% 71.3% 64.0% 55.3% 44.6%
(Post-Convert) 64.1 59.1 52.9 45.5 36.8 25.9
- --------------------
(a) Based on management projections provided by Tiger and Mustang, respectively. Closing assumed as of 12/31/97; multiples
based on LTM (9/30/97) results. Assumes $4 million in annual pre-tax cost savings, interest rate on acquisition debt of 7.0%
and a marginal tax rate of 37%.
</TABLE>
<PAGE>
APPENDIX
<PAGE>
<TABLE>
Analysis of Selected Public Companies
($ in millions, except per share data)
<CAPTION>
Current Current
Share 52 Week Price as a Total
Price ---------------------- % of 52- Market Firm
Company Name 12/5/97 High Low Week High Value Value
- ---------------------------- ------------- ---------- ---------- ---------- ---------- --------- (cont'd
<S> <C> <C> <C> <C> <C> <C> below)
TIGER $31.125 22.000 31.625 98.4% $1,286.3 $1,231.9
Aeroquip-Vickers, Inc. $51.688 33.000 57.500 89.9% $1,455.4 $1,763.7
Barnes Group Incorporated $26.500 19.000 30.000 88.3% $537.6 $573.4
Blount International, Inc. $50.957 36.000 53.688 94.9% $953.9 $1,004.6
Cincinnati Milacron Inc. $27.938 18.000 29.688 94.1% $1,115.3 $1,473.7
Cooper Industries $51.625 38.500 57.438 89.9% $6,246.8 $7,525.7
Danaher Corp. $60.563 39.625 60.813 99.6% $3,540.0 $3,736.8
Dover $69.313 48.250 72.625 95.4% $7,707.1 $8,308.9
Federal Signal Corporation $20.188 20.188 27.375 73.7% $920.5 $1,185.2
GenCorp Inc. $24.500 17.500 31.000 79.0% $1,007.0 $1,157.6
Illinois Tool Works $56.063 38.375 56.313 99.6% $13,985.0 $14,827.0
Kaydon Corporation $33.813 20.938 34.125 99.1% $1,149.3 $1,072.9
Mark IV Industries $23.000 19.875 28.000 82.1% $1,465.3 $2,197.6
Pentair Inc. $37.625 27.125 39.625 95.0% $1,432.8 $1,970.5
Regal-Beloit Corporation $28.000 18.250 32.625 85.8% $583.0 $787.0
Teleflex $39.250 23.375 39.375 99.7% $1,452.7 $1,685.2
(table continued)
<CAPTION>
Firm Value Market Value
as a Multiple of: as a Multiple of:
---------------------------------------- -------------------------------------------------------
LTM LTM LTM LTM Net 1997E 1998E Book Dividend
Revenues EBITDA EBIT Income EPS EPS Value Yield
-------- -------- ------- ------- ------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
TIGER $658.4 $138.4 $113.3 $70.1 $1.76 $1.92 $541.4 0.90
1.9x 8.9x 10.9x 18.3x 17.7x 16.2x 2.4x
Aeroquip-Vickers, Inc. $2,099.4 $273.2 $206.4 $112.4 $4.06 $4.38 $491.3 1.55
0.8x 6.5x 8.5x 12.9x 12.7x 11.8x 3.0x
Barnes Group Incorporated $627.8 $92.5 $65.4 $39.5 $1.95 $2.00 $179.8 2.53
0.9x 6.2x 8.8x 13.6x 13.6x 13.3x 3.0x
Blount International, Inc. $686.7 $117.9 $94.2 $56.8 $3.03 $3.55 $300.0 0.56
1.5x 8.5x 10.7x 16.8x 16.8x 14.4x 3.2x
Cincinnati Milacron Inc. $1,854.1 $176.6 $124.5 $73.7 $2.00 $2.25 $452.3 1.72
0.8x 8.3x 11.8x 15.1x 14.0x 12.4x 2.5x
Cooper Industries $5,333.2 $885.8 $663.7 $433.3 $3.16 $3.55 $2,523.7 2.56
1.4x 8.5x 11.3x 14.4x 16.3x 14.5x 2.5x
Danaher Corp. $1,982.5 $329.3 $255.2 $146.5 $2.55 $2.90 $870.4 0.17
1.9x 11.3x 14.6x 24.2x 23.8x 20.9x 4.1x
Dover $4,370.5 $709.9 $569.0 $379.1 $3.40 $3.80 $1,625.6 1.10
1.9x 11.7x 14.6x 20.3x 20.4x 18.2x 4.7x
Federal Signal Corporation $912.9 $124.6 $104.7 $64.0 $1.29 $1.48 $293.4 3.32
1.3x 9.5x 11.3x 14.4x 15.6x 13.6x 3.1x
GenCorp Inc. $1,532.8 $184.8 $125.0 $82.4 $1.70 $2.03 $264.0 2.45
0.8x 6.3x 9.3x 12.2x 14.4x 12.1x 3.8x
Illinois Tool Works $5,168.2 $1,093.1 $903.4 $561.1 $2.35 $2.60 $2,666.0 0.86
2.9x 13.6x 16.4x 24.9x 23.9x 21.6x 5.2x
Kaydon Corporation $315.7 $102.5 $90.7 $58.3 $1.83 $2.06 $266.3 1.06
3.4x 10.5x 11.8x 19.7x 18.5x 16.4x 4.3x
Mark IV Industries $2,132.0 $304.6 $232.5 $106.3 $1.73 $2.00 $741.2 0.70
1.0x 7.2x 9.5x 13.8x 13.3x 11.5x 2.0x
Pentair Inc. $1,742.4 $227.1 $160.6 $79.7 $2.04 $2.38 $542.8 1.44
1.1x 8.7x 12.3x 18.0x 18.4x 15.8x 2.6x
Regal-Beloit Corporation $543.8 $112.2 $89.0 $37.1 $1.81 $2.15 $181.2 1.71
1.4x 7.0x 8.8x 15.7x 15.5x 13.0x 3.2x
Teleflex $1,074.6 $146.1 $100.7 $66.0 $1.80 $2.11 $450.9 1.02
1.6x 11.5x 16.7x 22.0x 21.8x 18.6x 3.2x
----------------------------------------------------------------------------------------------------------------
TIGER 1.9x 8.9x 10.9x 18.3x 17.7x 16.2x 2.4x 0.90%
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
High: 3.4x 13.6x 16.7x 24.9x 23.9x 21.6x 5.2x 3.32%
Low: 0.8 6.2 8.5 12.2 12.7 11.5 2.0 0.17
Mean: 1.5 9.0 11.8 17.2 17.3 15.2 3.4 1.42
Median: 1.4 8.5 11.3 15.7 16.3 14.4 3.3 1.10
----------------------------------------------------------------------------------------------------------------
- --------------------
Note: High, Low, Mean and Median calculations exclude Tiger.
</TABLE>
PROJECT MOTOWN Preliminary Draft - Confidential
- ------------------------------------------------------------------------------
<TABLE>
Comparative Growth Rates and Margins for Selected Public Companies
<CAPTION>
3 Year Compound Annual Growth Rates EBITDA Margin EBIT Margin
----------------------------------------- -------------------------- ---------------------------
Revenue EBITDA EBIT Net Income EPS Latest Year 4 Year Average Latest Year 4 Year Average
------- ------ ---- ---------- --- ----------- -------------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TIGER 10.6% 12.9% 14.2% 17.3% 16.5% 21.2% 20.9% 17.4% 17.0%
Aeroquip-Vickers, Inc. 7.3% 16.1% 23.0% 46.9% 47.9% 12.1% 11.2% 8.7% 7.7%
Barnes Group Incorporated 5.8% 26.4% 46.9% 64.5% 61.2% 13.8% 11.3% 9.3% 6.9%
Blount International, Inc.(a) NA NA NA NA NA 17.9% 17.5% 14.2% 13.9%
Cincinnati Milacron Inc. 18.9% 31.5% 34.9% 39.4% 18.3% 9.6% 8.6% 6.6% 5.9%
Cooper Industries 3.4% 2.7% 2.6% 7.0% 5.0% 16.4% 16.9% 12.0% 12.4%
Danaher Corp. 26.2% 32.9% 37.4% 39.1% 36.9% 15.6% 15.0% 12.0% 11.1%
Dover Corp. 18.0% 26.1% 28.5% 29.1% 29.4% 16.3% 14.5% 13.2% 11.4%
Federal Signal Corporation 16.6% 16.9% 17.2% 15.9% 16.2% 13.5% 13.6% 11.5% 11.5%
GenCorp Inc. -7.4% 0.4% 7.8% 16.0% 13.7% 11.8% 10.2% 7.5% 5.9%
Illinois Tool Works 16.5% 25.0% 29.4% 33.0% 28.9% 19.6% 18.0% 16.0% 14.2%
Kaydon Corp. 16.4% 18.4% 21.2% 22.2% 24.0% 31.2% 30.3% 27.2% 25.3%
Mark IV Industries 29.4% NA 28.9% 37.9% 24.6% 14.1% 13.9% 10.8% 10.6%
Pentair Inc. 18.3% 28.9% 28.0% 37.8% 31.5% 12.9% 11.6% 9.1% 8.2%
Regal-Beloit Corp. 6.0% 12.3% 15.3% 1.4% 0.9% 17.6% 16.8% 14.2% 13.3%
Teleflex 11.8% 13.7% 14.6% 19.3% 17.3% 15.0% 14.4% 10.8% 10.2%
- -------------------------------------------------------------------------------------------------------------------------------
TIGER (b) 10.6% 12.9% 14.2% 17.3% 16.5% 21.2% 20.9% 17.4% 17.0%
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
High: 29.4% 32.9% 46.9% 64.5% 61.2% 31.2% 30.3% 27.2% 25.3%
Low: -7.4% 0.4% 2.6% 1.4% 0.9% 9.6% 8.6% 6.6% 5.9%
Mean: 13.4% 19.3% 24.0% 29.3% 25.4% 15.8% 14.9% 12.2% 11.2%
Median: 16.5% 18.4% 25.5% 31.1% 24.3% 15.0% 14.4% 11.5% 11.1%
- -------------------------------------------------------------------------------------------------------------------------------
- ------------
(a) Due to discontinued operations and the change in fiscal year ending from February to December, the company does not
report proforma historic information prior to year 1995.
(b) High, Low, Mean and Median calculations exclude Tiger.
</TABLE>
<TABLE>
Summary Description of Selected Public Companies
<S> <C>
Tiger Tiger is an international diversified manufacturer of proprietary products. The Company
manufactures industrial container closures, specialty dispensing and packaging products,
pressured gas cylinders, specialty industrial gaskets, towing systems products, specialty
fasteners and other products. The Company's products are sold in commercial, industrial and
consumer niche markets.
Aeroquip-Vickers Inc. Aeroquip-Vickers manufactures engineered hydraulic, motion control and plastic components
and systems. The Company markets its brand name products to industrial, automotive and
aerospace and defense customers worldwide through manufacturing operations in 18
countries.
Barnes Group Barnes Group operates through its subsidiaries Bowman Distribution, Associated Spring and
Barnes Aerospace. The Company's products include: precision springs and custom metal
parts, fasteners, automotive replacement parts, spray chemicals, adhesives, sealants,
machined parts and jet engine components. The Company operates internationally.
Blount International, Blount International manufactures outdoor products, industrial, power and sporting equipment.
Inc. The Company's products include saw chains, sprockets, chain maintenance equipment, timber
harvesting and log loading equipment, industrial tractors, rotation bearings and power
transmission components.
Cincinnati Milacron, Cincinnati Milacron operates in three business segments: plastics machinery, machine tools
Inc. and industrial products. The Company produces household products, packaging, medical
supplies and electronics for manufacturers of cars, planes and industrial equipment as well as
computer controls and software for factory automation. The Company markets worldwide.
Cooper Industries, Cooper manufactures electrical, industrial and automotive products. The Company's products
Inc. include non-power hand tools, industrial tools, automobile lamps, brakes, compression
equipment for oil and natural gas applications, rotary drilling equipment, mining and
construction machinery and electrical power transformers. The Company distributes these
products worldwide.
Danaher Corp. Danaher manufactures tools and components and process/environmental controls. Products
include mechanics hand tools, drill chucks, diesel engine retarders, wheel service equipment,
leak detection sensors for underground fuel storage tanks, motion, temperature, pressure,
level, flow and power reliability and quality control devices.
Dover Corp. Dover manufactures a variety of specialized industrial products marketed nationally to the
building, petroleum, electronics, aerospace and other industries. Products include elevators,
petroleum production equipment, surface mount electronic assembly products, automotive
lifts, kettlers, steamers, refrigeration and air conditioning systems and food service equipment.
Federal Signal Corp. Federal Signal produces and supplies public safety, signaling and communications equipment
internationally. The Company manufactures tire rescue products, street sweeping and vacuum
loader vehicles, parking control equipment, custom on-premise signage, carbide cutting tools,
precision punches and related die components.
GenCorp, Inc. GenCorp manufactures aerospace and defense systems, automotive components and polymer-based
products. The Company produces defense electronics, armor automotive suspension systems,
plastic body panels, plastics, latex wallcovering, tennis balls and racquetballs.
Illinois Toolworks, Illinois Tool manufactures construction fasteners and packaging systems. The Company
Inc. produces plastic and metal fasteners, consumer and industrial packaging systems,
non-destructive testing equipment, electronic switches, adhesives, gear measuring instruments
and coating systems. The Company sells to the aerospace, appliance, automotive, truck,
computer and electronics markets.
Kaydon Corp. Kaydon designs, manufactures and sells custom engineered products to the replacement parts,
heavy industry, defense, construction, instrumentation and aerospace industries. Products
include anti-friction bearings, bearing systems, filters, high performance rings, filter housings,
sealing rings and shaft seals.
Mark IV Industries, Mark IV manufactures engineered systems and components utilizing mechanical and fluid
Inc. power transmission, fluid transfer and filtration technologies. The Company sells the products
to automotive and industrial customers worldwide.
Pentair, Inc. Pentair is a diversified manufacturing company. The Company operates in three markets:
electrical and electronic enclosures; professional tools and equipment and water products.
Pentair manufactures and distributes its products in North America, Europe and Asia.
Regal-Beloit Corp. Regal-Beloit supplies power transmission equipment, perishable cutting tools, electric motors
and generators, and related products. The Company's manufacturing, sales and service
facilities are located throughout the United States and in Europe and the Far East.
Teleflex, Inc. Teleflex designs, manufactures and distributes products and services for the aerospace,
commercial, medical, auto, marine and industrial markets. The Company markets mechanical,
electrical, electromechanical and hydraulic control equipment.
</TABLE>
<TABLE>
Analysis of Selected Precedent Transactions
($ in millions, except per share data)
<CAPTION>
Announce- Total
ment Acquiror/ Equity Enterprise
Date Target Target Description Value Value
- -------- -------------------------------------- ------------------------- -------- ----------(cont'd
<S> <C> <C> <C> <C> below)
10/10/97 Kennametal, Inc./ Manufactures cutting $623.2 $943.2
Greenfield Industries(a) tools, carbide products
08/28/97 Applied Power Inc./ Manufactures rubber $141.9 $140.8
Versa Technologies Inc.(b) components, molds
07/25/97 Constellation Capital Partners/ Manufactures industrial $121.9 $417.8
Imo Industries Inc.(c) controls, pumps
06/16/97 United Dominion Industries Ltd./ Manufactures $249.0 $294.8
Core Industries electronic equipment
05/12/97 Koch Engineering Co. (Koch Inds.)/ Manufactures $250.0 $250.0
Glitsch International Inc.(d) stainless steel packings
02/26/97 Regal-Beloit Corp./ Manufactures $278.0 $248.3
Marathon Electric Manufacturing electric motors
07/01/96 Precision Castparts/ Manufactures wheel $200.0 $300.0
NEWFLO Corp. valves, fittings and pumps
06/14/96 Varlen Corp./ Manufactures ball and $168.0 $164.9
Brenco Inc. roller bearings
04/02/96 Allegheny Ludlum Corp./ Manufactures aviation $2,102.1 $2,442.4
Teledyne Inc. products
(table continued)
TEV Equity Value
as a Multiple of: as a Multiple of:
------------------------------------------ ------------------------
LTM LTM LTM LTM Book
Revenues EBITDA EBIT Income Value
- ----------------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
10/10/97 $527.0 $81.3 $60.5 $25.3 $200.7
1.8x 11.6x 15.6x 24.6x 3.1x
08/28/97 $95.3 $14.8 $11.0 $6.8 $46.7
1.5x 9.5x 12.8x 20.8x 3.0x
07/25/97 $473.4 $45.5 $25.6 $7.6 ($69.4)
0.9x 9.2x 16.3x 16.1x NM
06/16/97 $255.1 $32.9 $23.0 $15.4 $112.2
1.2x 9.0x 12.8x 16.2x 2.2x
05/12/97 $300.0 NA NA NA NA
0.8x NA NA NA NA
02/26/97 $245.2 $34.4 $27.2 $17.8 $115.0
1.0x 7.2x 9.1x 15.6x 2.4x
07/01/96 $211.5 $37.2 $29.1 $7.5 ($3.1)
1.4x 8.1x 10.3x 26.8x NM
06/14/96 $124.8 $19.6 $15.0 $9.6 $66.1
1.3x 8.4x 11.0x 17.5x 2.5x
04/02/96 $2,611.0 $303.5 $232.9 $125.9 $432.2
0.9x 8.0x 10.5x 16.7x 4.9x
- ---------------------
Note: Based on available information for announced transactions from January 1, 1994 - December 5, 1997, with deal values
greater than $100 mm, from Securities Data Corp. using the following SIC codes - 3533, 1791, 3443, 3053, 3496, 5013,
5084, 7538,7539, 3714, 2822, 2452, 3452, 3545, 3565, 3711, 3544, 3531, 3562, 3569, 3592, 3621, 3679, 3494, 3491, 3052,
3647, 3559, 3545, 3469, 3519, 3561, 3069, 3799, 2672.
(a) Excludes pre-tax charge of $4 million ($2.5 million after-tax) in one-time restructuring charges.
(b) Excludes pre-tax loss of $0.8 million on sale of businesses ($0.7 million after-tax).
(c) Excludes unusual items related to disposition of assets and restructuring charges. Annualized LTM net income to represent
continuing operations.
(d) Source: Bloomberg News, May 26, 1997. Equity value is approximated.
</TABLE>
<TABLE>
Analysis of Selected Precedent Transactions
($ in millions, except per share data)
<CAPTION>
Announce- Total
ment Acquiror/ Equity Enterprise
Date Target Target Description Value Value
- ----------------------- ------------------------------- --------------------------- --------- ----------- (cont'd
<S> <C> <C> <C> <C> below)
03/07/96 Danaher Corp./ Manufactures metal $213.0 $193.1
Acme-Cleveland Corp.(a) cutting tools
01/22/96 Farnell Electronics PLC/ Manufactures wheel $2,722.7 $2,685.8
Premier Industrial Corp. electronic parts/equipment
12/12/95 Tomkins PLC/ Manufactures auto, $1,160.0 $1,400.0
Gates Corp.(b) industrial belts
09/12/95 Textron Inc./ Manufactures fasteners $179.0 $217.2
Elco Industries Inc. and hardware
10/03/94 Mark IV Industries Inc./ Manufactures oil, fuel $277.0 $323.1
Purolator Products Co. and air filters
(table continued)
<CAPTION> TEV Equity Value
as a Multiple of: as a Multiple of:
Announce- --------------------------------------- ---------------------
ment LTM LTM LTM LTM Net Book
Date Revenues EBITDA EBIT Income Value
- ----------------------- ---------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
03/07/96 $129.7 $18.5 $13.8 $9.7 $107.8
1.5x 10.5x 14.0x 22.0x 2.0x
01/22/96 $818.2 $181.1 $172.4 $108.1 $473.6
3.3x 14.8x 15.6x 25.2x 5.7x
12/12/95 $1,582.9 NA NA $80.4 NA
0.9x NA NA 14.4x NA
09/12/95 $249.3 $30.5 $19.1 $9.9 $73.7
0.9x 7.1x 11.4x 18.0x 2.4x
10/03/94 $460.4 $40.7 $26.9 $21.8 $177.7
0.7x 7.9x 12.0x 12.7x 1.6x
-----------------------------------------------------------------------------------
Median: 1.1x 8.7x 12.4x 17.5x 2.4x
Mean: 1.3 9.3 12.6 19.0 3.0
High: 3.3 14.8 16.3 26.8 5.7
Low: 0.7 7.1 9.1 12.7 1.6
-----------------------------------------------------------------------------------
- ---------------------
Note: Above selected transactions include change of control transactions.
Based on available information for announced transactions from January 1, 1994 - December 5, 1997, with deal values
greater than $100 mm, from Securities Data Corp. using the following SIC codes - 3533, 1791, 3443, 3053, 3496, 5013,
5084, 7538,7539, 3714, 2822, 2452, 3452, 3545, 3565, 3711, 3544, 3531, 3562, 3569, 3592, 3621, 3679, 3494, 3491, 3052,
3647, 3559, 3545, 3469, 3519, 3561, 3069, 3799, 2672.
(a) EBIT, EBITDA and Net Income exclude non-recurring charges for purchased research and development write-off and unsolicited
tender offer expenses.
(b) Source: Extel Financial limited, January 30, 1996. Net Revenue and Net Income based on annualized third quarter results
for Gates Corp.
</TABLE>
<TABLE>
Premium Analysis for Selected Transactions
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------(cont'd
<S> <C> <C> <C> below)
03/02/90 Shearson Lehman American Express American Express, the 61% owner
Brothers Holdings/ Company/ of Shearson Lehman Hutton
Securities brokerage Financial, investment Holdings, acquired the 39% that it
firm services did not already own for 0.48
American Express shares per
Shearson share, or $360 million,
sweetened from 0.426 shares, or
$319.52 million. Based on
American Express' $26.875 closing
price on 3/26/90, the last full
trading day prior to announcement,
each share of Shearson was valued
at $12.90.
07/06/90 Mack Trucks Inc./ Renault Vehicules Renault Vehicules Industriels, a unit
Manufactures trucks, Industriels/ of France's Regie Nationale des
tractors Manufactures trucks Usines Renault, acquired the 40% of
and buses Mack Trucks it did not own through
a tender offer of $6.25 per share, or
$103.7 million.
01/16/90 Subaru of America Inc./ Fuji Heavy Industries Fuji Heavy Industries (FHI) acquired
Automobile wheels and Ltd./ the 50.4% of Subaru of America
parts Manufactures cars, (SOA) it did not already own for
trucks, airplanes $8.5 in cash per share, or
$210.56 million.
01/03/91 Ocean Drilling & Murphy Oil Corporation/ Murphy Oil (MO) acquired the
Exploration/ Oil and gas exploration, remaining 39% of Ocean Drilling &
Oil and gas exploration, production Exploration (ODECO) that it did not
production already own in a hostile
$391.8 million tender. MO, which
offered 0.55 shares for each of
ODECO's 20,094,000 shares,
accepted 17,585,499 of the shares
through a tender offer.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
03/02/90 $12.90 $13.00 $10.88 $12.00
(0.8%) 18.6% 7.5%
07/06/90 $6.25 $5.25 $5.25 $5.13
19.0% 19.0% 22.0%
01/16/90 $8.50 $5.13 $5.25 $5.75
65.9% 61.9% 47.8%
01/03/91 $19.39 $17.00 $15.63 $17.75
14.1% 24.1% 9.2%
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
Premium Analysis for Selected Transactions
(continued)
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------ (cont'd
<S> <C> <C> <C> below)
02/06/91 Hamilton Oil BHP Holdings (USA) BHP Holdings (USA), a unit of
Corporation/ Inc. (Broken Hill)/ Broken Hill Proprietary, acquired the
Oil and gas exploration, Oil and gas exploration, remaining 49.9% of Hamilton Oil
production production that it did not already own through a
tender offer valued at
$524.3 million. BHP purchased
7,412,697 shares through the
tender offer and acquired the rest by
merger in which shareholders
received a choice of $40 in cash or
$40 in Broken Hill American
Depository Receipts per share.
05/01/91 United Artists Tele-Communications Tele-Communications (TC) acquired
Entertainment/ Inc./ the remaining 46% of United Artists
Owns and operates Operates cable TV Entertainment (UAE) in a sweetened
movie theaters systems $1.189 billion stock and cash offer.
TC offered 1.02 shares, up from
0.95, for each UAE share. Based on
TC's closing stock price of $15.875
on June 6, the stock portion was
valued at $16.19 per share, or a
total $1.037 billion.
08/17/92 PHLCORP Inc./ Leucadia National Leucadia National (LN), a unit of
Life insurance company Corporation/ Unitah National, acquired the
Provides Insurance remaining 36.98% or 5,428,127
services shares, of PHLCORP that it did not
already own for $139.94 million in
LN common stock. LN exchanged
0.406 common shares for each
remaining share of PHL. Based on
LN's closing price of $63.50 on
October 9, the last full trading day
prior to the announcement, each
PHL share was valued at $25.78.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
02/06/91 $40.00 $33.75 $33.00 $30.50
18.5% 21.2% 31.1%
05/01/91 $16.19 $13.50 $13.25 $12.88
19.9% 22.2% 25.7%
08/17/92 $25.78 $23.00 $22.38 $20.00
12.1% 15.2% 28.9%
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
Premium Analysis for Selected Transactions
(continued)
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------ (cont'd
<S> <C> <C> <C> below)
09/09/92 American Fructose American Maize-Products Co./ American Maize-Products (AM)
Corp./ Produces corn; acquired the remaining 57.34%
Manufactures corn manufactures stake (4.046 million and
syrups, starches tobacco products 1.054 million Class A and B
common shares, respectively) in
American Fructose (AF) in an
amended stock swap valued at
$130.29 million. AM offered 1 A
share per AF A share and 1 B share
per AF B share, or $22.475 in cash,
AM's average Class A share price
for the 5 days prior to completion.
11/13/92 Brand Companies Inc./ Rust International Inc./ Rust International (RI), 56% held by
Hazardous-waste Provide engineering Waste Management's Chemical
abatement services services Waste Management (CW), acquired
the remaining 9.9 million shares, or
44% of Brand it did not own for an
amended $185 million. RI offered a
choice of 1 share or $18.75 in cash
per share held. Holders of
6.9 million shares chose cash,
totaling $129 million, while 3 million
opted for stock valued at
$56 million, based on RI's closing
stock price of $19.75 on May 10,
the first full trading day for RI.
07/28/94 Chemical Waste WMX Technologies WMX Technologies acquired the
Management Inc./ Inc./ remaining 44.9 million common
Provides Hazardous Provides Chemical shares, or 21.4%, it did not already
waste management waste management own in Chemical Waste
services services Management (CWM) in a transaction
valued at an amended
$397.365 million. CWM's
shareholders received $8.85 in
$1,000 principal amount convertible
subordinated notes for each share
held, amended from 0.27 WMX
shares for each CWM share held.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
09/09/92 $25.50 $21.00 $20.63 $19.75
21.4% 23.6% 29.1%
11/13/92 $18.75 $17.88 $16.50 $17.88
4.9% 13.6% 4.9%
07/28/94 $8.85 $8.00 $8.13 $8.75
10.6% 8.9% 1.1%
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
Premium Analysis for Selected Transactions
(continued)
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------ (cont'd
<S> <C> <C> <C> below)
01/18/95 Arcadian Partners LP/ Arcadian Corp./ Arcadian acquired the remaining
Manufactures Manufactures 55% of the outstanding preference
phosphatic phosphatic units of Arcadian Partners (AP) it did
fertilizers fertilizers not already own for an amended
$29 per preference unit, or a total
value of $428.4 million.
Consideration consisted of $14.5 in
cash and $14.5 in Arcadian capped
convertible preferred stock.
02/27/95 CCP Insurance Inc./ Conseco Inc./ Conseco acquired the remaining
Insurance company Insurance holding 12.49 million shares, or 52%
company interest on a fully-diluted basis, that
it did not already own in CCP
Insurance for an amended $23.25 in
cash per share, or a total value of
$273.677 million.
04/05/95 Club Med Inc./ Club Mediterranee SA/ Club Mediterranee (CM) merged
Operates vacation Operates travel agency, with Club Med in a transaction
resorts hotel resorts valued at $153.4 million concurrent
with the completion of its tender
offer for the remaining 4.794 million
shares, or 33% stake, that it did not
already own in Club Med for an
amended $32 in cash per share, by
accepting 4,717,450 shares, or a
32.5% stake, raising CM's interest
to 99.5%.
04/07/95 LIN Broadcasting McCaw Cellular McCaw Cellular Communications
(McCaw Cellular)/ Communications (MC), a unit of AT&T, exercised its
Provides cellular (AT&T)/ option to acquire the remaining
communication Provides cellular 48%, or 24 million shares, of LIN
services communication Broadcasting (LIN) it did not already
services own for an amended $129.90 in
cash per share, or a total of
$3.209 billion.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
01/18/95 $29.00 $24.75 $23.88 $23.00
17.2% 21.5% 26.1%
02/27/95 $23.25 $19.38 $17.88 $18.88
20.0% 30.1% 23.2%
04/05/95 $32.00 $22.63 $22.88 $22.13
41.4% 39.9% 44.6%
04/07/95 $129.90 $109.88 $108.50 $108.50
18.2% 19.7% 19.7%
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
Premium Analysis for Selected Transactions
(continued)
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------ (cont'd
<S> <C> <C> <C> below)
05/15/95 Bic Corporation (BIC BIC SA/ BIC acquired the remaining 22%
SA)/ Manufactures pens and stake it did not already own in BIC
Manufactures writing lighters Corporation for an amended $40.50
instruments in cash per share, or a total value of
$212.625 million. BIC had originally
offered $36.50 in cash per share, or
a total value of $191.625 million.
07/14/95 REN Corporation - USA COBE Laboratories COBE Laboratories, a majority-held
(COBE Labs Inc.)/ (Gambro AB)/ unit of Gambro, acquired the
Owns, operates kidney Manufactures medical remaining 47% of REN Corp. - USA
dialysis centers equipment (REN) it did not already own in a
transaction valued at
$182.09 million.
08/25/95 GEICO Corporation Berkshire Hathaway Berkshire Hathaway acquired the
(Berkshire Inc./ remaining 47.4% stake, which it did
Hathaway)/ Property, casualty not already own, in GEICO for $70
Insurance and financial insurance company in cash per share, or a total value of
services $2.306 billion. The transaction had
been subject to regulatory approval,
including that of the state insurance
regulators.
05/27/96 SyStemix Inc. (Novartis Novartis AG/ Novartis completed its tender offer
AG)/ Manufactures for the remaining 6,233,311
Manufactures, develops pharmaceuticals common shares or 26.8% of
cellular processes SyStemix shares outstanding, that it
did not already own, for an amended
$19.5 in cash per share, or a total
value of $107.56 million.
01/13/97 Zurich Reinsurance Zurich Versicherungs Zurich Versicherungs acquired the
Centre/ GmbH/ remaining 34% stake, or
Insurance agency Insurance holding 8.86 million common shares, that it
company did not already own in its Zurich
Reinsurance Center Holdings
subsidiary, for $36 per share, or a
total of $316.981 million.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
05/15/95 $40.50 $35.75 $36.00 $31.50
13.3% 12.5% 28.6%
07/14/95 $20.00 $15.75 $16.63 $15.88
27.0% 20.3% 26.0%
08/25/95 $70.00 $55.75 $56.88 $55.88
25.6% 23.1% 25.3%
05/27/96 $19.50 $18.63 $11.50 $12.25
4.7% 69.6% 59.2%
01/13/97 $36.00 $30.75 $30.38 $32.25
17.1% 18.5% 11.6%
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
Premium Analysis for Selected Transactions
(continued)
<CAPTION>
Date Target Name/ Acquiror Name/
Announced Business Description Business Description Synopsis
- --------- ----------------------- ------------------------ ------------------------------------ (cont'd
<S> <C> <C> <C> below)
01/30/97 AST Research Inc./ Samsung Electronics Samsung Electronics (SE) acquired
Manufactures Co. Ltd./ the remaining 51% interest, or
computers; Manufactures consumer 35 million common shares, which it
develops software electronics did not already own, in AST
Research (AST) for $5.40 in cash
per share, or a total value of
$495.8 million, including the
assumption of approximately
$307 million in liabilities.
06/02/97 Acordia Inc. (Anthem Anthem Inc./ Anthem acquired the remaining
Inc.)/ Insurance company 33.2%, or 4.32 million common
Provides insurance shares, that it did not already own,
brokerage services in Acordia, for $40 in cash per
share, or a total value of
$193.155 million.
08/29/97 Rexel Inc./ Rexel SA (Pinault-Printemps)/ Rexel SA (RE), a majority-owned
Manufactures electrical Manufactures radios, unit of Pinault-Printemps Redoute,
components televisions completed a sweetened tender offer
to acquire the remaining 51.28%
interest, or 13,865,019 common
shares, which it did not already
own, in Rexel Inc. (RI) for $22.5 in
cash per share, or a total value of
$302.028 million, by accepting
11.644 million shares, or 84% of
RI's shares outstanding.
(table continued)
<CAPTION>
Closing Price/ % Premium
Final ---------------------------------------------
Transaction Announcement Date:
Price 1 day prior 1 week prior 4 weeks prior
- ------------------ ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
01/30/97 $5.40 $4.63 $5.00 $4.50
16.8% 8.0% 20.0%
06/02/97 $40.00 $35.50 $35.88 $31.75
12.7% 11.5% 26.0%
08/29/97 $22.50 $18.88 $17.81 $18.50
19.2% 26.3% 21.6%
----------------------------------------------------
Mean: 18.6% 24.1% 24.5%
Median: 17.2 20.8 25.5
High: 65.9 69.6 59.2
Low: (0.8) 8.0 1.1
----------------------------------------------------
- --------------------
Note: Based on announced/completed domestic transactions since 1/1/90 with deal value greater than $100 million, acquiror with
existing ownership position exceeding 40%, where information is available from SDC, as of December 5, 1997.
</TABLE>
PROJECT MOTOWN Preliminary Draft - Confidential
- ------------------------------------------------------------------------------
<TABLE>
Summary of Termination Fees for Selected Transactions
(dollars in millions)
<CAPTION>
Date Date
Announced Effective Target Name Acquiror Name Equity Value
- --------- --------- ------------------------------- ------------------------------ ------------ (cont'd
<S> <C> <C> <C> <C> below)
01/22/96 - Kansas City Power & Light Co UtiliCorp United Inc $1,688.4
02/13/96 09/18/96 Citicasters(American Finl Grp) Jacor Communications Inc 617.6
02/23/96 07/01/96 Cray Research Inc Silicon Graphics Inc 783.0
03/29/96 08/07/96 MediSense Inc Abbott Laboratories 817.3
06/11/96 07/23/96 Community Health Systems Inc Forstmann Little & Co 1,080.0
06/28/96 10/02/96 National Re Corp General Re Corp 907.9
08/26/96 12/17/96 American Travellers Corp Conseco Inc 882.7
09/02/96 03/06/97 Arcadian Corp Potash Corp of Saskatchewan 1,198.3
10/28/96 01/15/97 Loctite Corp Henkel KGaA 1,973.2
01/07/97 02/25/97 American Medical Response Inc MedTrans Inc(Laidlaw Inc) 1,011.1
01/15/97 08/06/97 Value Health Inc Columbia/HCA Healthcare Corp 1,132.0
01/23/97 05/19/97 Amphenol Corp Kohlberg Kravis Roberts & Co 1,162.7
02/18/97 06/27/97 Destec Energy Inc NGC Corp 1,222.4
02/28/97 08/01/97 Healthsource Inc CIGNA Corp 1,402.7
04/14/97 11/12/97 APL Ltd Neptune Orient Lines Ltd 877.6
04/14/97 - Wyndham Hotel Corp Patriot Amer Hosp/Patriot Amer 621.2
04/21/97 05/28/97 Goulds Pumps Inc ITT Industries Inc 803.3
05/05/97 06/13/97 Vivra Inc Incentive AB 1,640.2
05/08/97 11/04/97 Living Centers of America Inc Apollo Management LP 809.9
06/06/97 10/14/97 Telco Communications Group Inc Excel Communications Inc 1,037.1
06/09/97 07/15/97 Prime Service Inc Atlas Copco North America Inc 906.0
06/16/97 10/10/97 Multicare Cos Inc Genesis Eldercare Acquisition 888.5
07/17/97 09/29/97 Octel Communications Corp Lucent Technologies Inc 1,815.4
07/24/97 09/15/97 Nellcor Puritan-Bennett Mallinckrodt Inc 1,858.4
08/12/97 - LIN Television Corp Hicks Muse Tate & Furst Inc 1,690.5
09/05/97 11/26/97 Medic Computer Systems Inc Misys PLC 915.5
09/11/97 - Fieldcrest Cannon Inc Pillowtex Corp 468.2
09/12/97 - Western National Corp American General Corp 2,115.7
10/10/97 11/19/97 Greenfield Industries Inc Kennametal Inc 742.8
11/21/97 - BDM International Inc TRW Inc 819.2
(table continued)
<CAPTION>
Termination
Pooling Target's Acquiror's Fee as a
Date of Termination Termination Termination % of
Announced Interests Fee Fee Fee Equity Value
- --------- --------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
01/22/96 No $53.0 $58.0 $58.0 3.4%
02/13/96 No 20.0 - 20.0 3.2
02/23/96 No 25.0 - 25.0 3.2
03/29/96 No 17.5 - 17.5 2.1
06/11/96 No 45.0 - 45.0 4.2
06/28/96 No 25.0 25.0 25.0 2.8
08/26/96 No 20.0 - 20.0 2.3
09/02/96 No 25.0 - 25.0 2.1
10/28/96 No 40.0 - 40.0 2.0
01/07/97 No 17.5 - 17.5 1.7
01/15/97 No 45.0 - 45.0 4.0
01/23/97 No 37.5 - 37.5 3.2
02/18/97 No 65.0 - 65.0 5.3
02/28/97 No 45.0 - 45.0 3.2
04/14/97 No 25.0 - 25.0 2.8
04/14/97 No 30.0 30.0 30.0 4.8
04/21/97 No 22.0 - 22.0 2.7
05/05/97 No 50.0 - 50.0 3.0
05/08/97 No 20.0 - 20.0 2.5
06/06/97 No 20.0 - 20.0 1.9
06/09/97 No 27.2 - 27.2 3.0
06/16/97 No 25.0 - 25.0 2.8
07/17/97 No 50.0 - 50.0 2.8
07/24/97 No 45.0 - 45.0 2.4
08/12/97 No 64.0 - 64.0 3.8
09/05/97 No - 18.0 18.0 2.0
09/11/97 No 15.0 - 15.0 3.2
09/12/97 No 7.5 - 7.5 0.4
10/10/97 No 30.0 - 30.0 4.0
11/21/97 No 35.0 - 35.0 4.3
----------------------------
High: 5.3%
Low: 0.4%
Mean: 3.0%
Median: 2.9%
----------------------------
- ------------
Source: Securities Data Corporation as of 12/5/97; cash transactions from
1/1/96 to 12/5/97 with deal value between $750 million and $2
billion, where termination fees were disclosed.
</TABLE>
<PAGE>
EXHIBIT (b)(3)
SALOMON SMITH BARNEY
- --------------------
A Member of TravelersGroup
December 10, 1997
The Board of Directors
MascoTech, Inc.
21001 Van Born Road
Taylor, Michigan 48180
Members of the Board:
You have requested our opinion as to the fairness, from a financial point of
view, to MascoTech, Inc. ("MascoTech") of the consideration to be paid
pursuant to the terms and subject to the conditions set forth in the Agreement
and Plan of Merger, dated as of December 10, 1997 (the "Merger Agreement"), by
and among MascoTech, MascoTech Acquisition, Inc., a wholly owned subsidiary of
MascoTech ("Merger Sub"), and TriMas Corporation ("TriMas"). As more fully
described in the Merger Agreement and subject to the terms and conditions set
forth therein, (i) MascoTech will cause Merger Sub to commence a tender offer
to purchase all outstanding shares of the common stock, par value $0.01 per
share, of TriMas (the "TriMas Common Stock" and, such tender offer, the
"Tender Offer") at a purchase price of $34.50 per share to the seller in
cash (the "Purchase Price"), and (ii) subsequent to the Tender Offer, Merger
Sub will be merged with and into TriMas (the "Merger" and, together with the
Tender Offer, the "Transaction") and each outstanding share of TriMas Common
Stock not previously tendered will be converted into the right to receive the
Purchase Price.
In arriving at our opinion, we reviewed the Merger Agreement and held
discussions with certain senior officers, directors and other representatives
and advisors of MascoTech and certain senior officers and other
representatives and advisors of TriMas concerning the businesses, operations
and prospects of MascoTech and TriMas. We examined certain publicly available
business and financial information relating to MascoTech and TriMas as well as
certain financial forecasts and other information and data for MascoTech and
TriMas which were provided to or otherwise discussed with us by the
managements of MascoTech and TriMas, including information relating to certain
strategic implications and operational benefits anticipated by the management
of MascoTech to result from the Transaction. We reviewed the financial terms
of the Transaction as set forth in the Merger Agreement in relation to, among
other things: current and historical market prices and trading volumes of
TriMas Common Stock; the historical and projected earnings and other operating
data of TriMas; and the capitalization and financial condition of TriMas. We
also evaluated the potential pro forma financial impact of the Transaction on
MascoTech. In addition to the foregoing, we conducted such other analyses and
examinations and considered such other financial, economic and market criteria
as we deemed appropriate in arriving at our opinion.
In rendering our opinion, we have assumed and relied, without independent
verification, upon the accuracy and completeness of all financial and other
information and data publicly available or furnished to or otherwise reviewed
by or discussed with us. With respect to financial forecasts and other
information and data provided to or otherwise reviewed by or discussed with
us, we have been advised by the respective managements of MascoTech and TriMas
that such forecasts and other information and data were reasonably prepared on
bases reflecting the best currently available estimates and judgments of such
managements as to the future financial performance of MascoTech and TriMas and
the best currently available estimates and judgments of the management of
MascoTech as to the strategic implications and operational benefits
anticipated to result from the Transaction. We have not made or been provided
with an independent evaluation or appraisal of the assets or liabilities
(contingent or otherwise) of MascoTech or TriMas nor have we made any physical
inspection of the properties or assets of MascoTech or TriMas. We have not
been asked to consider, and our opinion does not address, the relative merits
of the Transaction as compared to any alternative business strategies that
might exist for MascoTech or the effect of any other transaction in which
MascoTech might engage. Our opinion is necessarily based upon information
available to us, and financial, stock market and other conditions and
circumstances existing and disclosed to us, as of the date hereof.
Smith Barney Inc. and Salomon Brothers Inc (collectively doing business as
Salomon Smith Barney) have acted as financial advisors to MascoTech in
connection with the Transaction and will receive a fee for such services, a
significant portion of which is contingent upon the consummation of the
Transaction. We have in the past provided investment banking services to
MascoTech and are currently providing investment banking services to
affiliates of MascoTech unrelated to the proposed Transaction, for which
services we have received compensation. In the ordinary course of our
business, we and our affiliates may actively trade or hold the securities of
MascoTech and TriMas for our own account or for the account of our customers
and, accordingly, may at any time hold a long or short position in such
securities. In addition, we and our affiliates (including Travelers Group
Inc. and its affiliates) may maintain relationships with MascoTech and TriMas.
Our advisory services and the opinion expressed herein are provided for the
information of the Board of Directors of MascoTech in its evaluation of the
proposed Transaction and is not intended to be and does not constitute a
recommendation to any stockholder. Our opinion may not be published or
otherwise used or referred to, nor shall any public reference to Salomon Smith
Barney be made, without our prior written consent.
Based upon and subject to the foregoing, our experience as investment bankers,
our work as described above and other factors we deemed relevant, we are of
the opinion that, as of the date hereof, the Purchase Price to be paid in the
Transaction is fair, from a financial point of view, to MascoTech.
Very truly yours,
/s/ SALOMON SMITH BARNEY
SALOMON SMITH BARNEY
<PAGE>
EXHIBIT (b)(4)
- --------------------------------------------------------------------------------
CONFIDENTIAL
Project Yacht
PRESENTATION TO THE BOARD OF DIRECTORS
December 10, 1997
SALOMON SMITH BARNEY
- --------------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
CONFIDENTIAL
------------
The following pages contain material that was provided to the Board of Directors
of Sloop (the "Company") by Salomon Smith Barney in the context of meetings of
the Board of Directors held to evaluate the potential transaction involving
Schooner. The accompanying material was compiled or prepared on a confidential
basis solely for use by the Board of Directors and not with a view toward public
disclosure under state and federal securities laws or otherwise. The information
contained in this material was obtained from the Company, Schooner and other
sources. Any estimates and projections for the Company and Schooner contained
herein have been prepared by managements of the Company or Schooner or are based
upon such estimates and projections, and involve numerous and significant
substantive determinations, which may or may not be correct. No representation
or warranty, expressed or implied, is made as to the accuracy or completeness of
such information and nothing contained herein is, or shall be relied upon as, a
representation, whether as to the past or the future. Neither the Company nor
Salomon Smith Barney nor any of their respective legal or financial advisors or
accountants takes any responsibility for the accuracy or completeness of any of
the material when used by persons other than the Board of Directors of the
Company. Salomon Smith Barney does not intend to revise these materials
subsequent to the date hereof.
<PAGE>
Confidential Project Yacht
- -------------------------------------------------------------------------------
Table of Contents
Tab
---
Trading Analysis .......................................................... A
Stand Alone Financial Analysis ............................................ B
Transaction Overview ...................................................... C
Valuation Analysis ........................................................ D
Pro Forma Effect of the Transaction ....................................... E
Exhibits
Comparable Company Analysis ............................................... F
Precedent Transactions Analysis ........................................... G
Discounted Cash Flow Analysis ............................................. H
<PAGE>
- ---------------------------------------------------------------------------
Trading Analysis
- ---------------------------------------------------------------------------
<PAGE>
[Graphic Omitted
The data below were used in constructing the graph titled
Schooner LTM Price Volume Performance]
TriMas
Closing Trading
Date Price Volume
---- ----- -------
9-Dec-96 $24.63 800
10-Dec-96 24.375 33,300
11-Dec-96 24.25 14,500
12-Dec-96 23.875 3,000
13-Dec-96 23.75 2,000
16-Dec-96 23.125 9,900
17-Dec-96 23.25 11,100
18-Dec-96 22.75 10,200
19-Dec-96 23 25,000
20-Dec-96 23.5 9,600
23-Dec-96 22.625 9,200
24-Dec-96 22.75 9,700
25-Dec-96 22.75 NA
26-Dec-96 22.875 27,700
27-Dec-96 23.5 76,200
30-Dec-96 23.5 8,100
31-Dec-96 23.875 8,100
1-Jan-97 23.875 NA
2-Jan-97 23.875 189,200
3-Jan-97 24.25 148,500
6-Jan-97 24.125 5,600
7-Jan-97 24.125 56,300
8-Jan-97 23.875 91,700
9-Jan-97 23.25 89,800
10-Jan-97 23.375 31,800
13-Jan-97 23.125 26,100
14-Jan-97 23.25 19,800
15-Jan-97 22.625 21,700
16-Jan-97 22.875 4,000
17-Jan-97 23 130,800
20-Jan-97 22.875 7,200
21-Jan-97 23.125 138,700
22-Jan-97 22.875 7,000
23-Jan-97 22.75 2,800
24-Jan-97 22.5 22,200
27-Jan-97 22.25 11,200
28-Jan-97 22.25 43,900
29-Jan-97 22 25,000
30-Jan-97 22.25 25,700
31-Jan-97 22.25 23,500
3-Feb-97 $22.50 26,000
4-Feb-97 22.625 56,200
5-Feb-97 22.875 16,100
6-Feb-97 23.5 46,800
7-Feb-97 23.375 6,400
10-Feb-97 23.5 24,400
11-Feb-97 23.875 751,500
12-Feb-97 23.875 32,500
13-Feb-97 23.875 121,500
14-Feb-97 24 113,000
17-Feb-97 24 NA
18-Feb-97 24.75 210,800
19-Feb-97 24.625 81,200
20-Feb-97 24.625 76,700
21-Feb-97 24.25 93,900
24-Feb-97 24.25 8,900
25-Feb-97 24.5 56,600
26-Feb-97 24.5 23,000
27-Feb-97 24.375 11,100
28-Feb-97 24.375 12,200
3-Mar-97 24.75 97,200
4-Mar-97 24.75 29,000
5-Mar-97 24.5 120,200
6-Mar-97 24.5 108,200
7-Mar-97 24.375 117,700
10-Mar-97 24.75 77,100
11-Mar-97 24.5 45,300
12-Mar-97 24.375 37,500
13-Mar-97 24 23,600
14-Mar-97 24.125 70,700
17-Mar-97 23.875 32,000
18-Mar-97 23.75 45,500
19-Mar-97 23.5 59,200
20-Mar-97 23.375 113,600
21-Mar-97 23.5 184,900
24-Mar-97 23.5 115,300
25-Mar-97 23.375 146,000
26-Mar-97 23.5 43,900
27-Mar-97 23.625 70,100
28-Mar-97 23.625 NA
31-Mar-97 $23.50 49,200
1-Apr-97 24.125 33,600
2-Apr-97 23.75 52,000
3-Apr-97 23.75 144,800
4-Apr-97 23.875 42,000
7-Apr-97 23.75 40,800
8-Apr-97 23.875 10,100
9-Apr-97 23.875 75,100
10-Apr-97 23.375 69,100
11-Apr-97 23.375 4,700
14-Apr-97 23 31,700
15-Apr-97 23 158,700
16-Apr-97 23.125 49,100
17-Apr-97 23.125 41,800
18-Apr-97 23.125 9,200
21-Apr-97 23.25 9,000
22-Apr-97 23.5 14,100
23-Apr-97 23.125 24,200
24-Apr-97 23.5 12,100
25-Apr-97 23.375 3,500
28-Apr-97 24 23,500
29-Apr-97 24.5 15,900
30-Apr-97 24.625 28,300
1-May-97 24.625 31,300
2-May-97 25 11,300
5-May-97 26 29,800
6-May-97 26.375 49,200
7-May-97 25.75 21,500
8-May-97 25.5 39,500
9-May-97 25.75 41,800
12-May-97 26.5 31,200
13-May-97 26.125 13,200
14-May-97 26.5 17,100
15-May-97 25.875 7,900
16-May-97 26.25 54,300
19-May-97 26.5 11,900
20-May-97 26.75 13,800
21-May-97 26.875 11,500
22-May-97 27.625 3,800
23-May-97 28.125 35,600
26-May-97 $28.13 NA
27-May-97 28.375 109,000
28-May-97 28.125 14,400
29-May-97 28 6,100
30-May-97 28.375 32,800
2-Jun-97 28.375 6,300
3-Jun-97 29 58,600
4-Jun-97 28.75 25,200
5-Jun-97 29 38,800
6-Jun-97 29.125 47,400
9-Jun-97 29.375 54,800
10-Jun-97 29.5 73,600
11-Jun-97 29.375 5,300
12-Jun-97 29.375 38,100
13-Jun-97 29.5 32,000
16-Jun-97 30 42,100
17-Jun-97 30.375 64,900
18-Jun-97 30.5 37,500
19-Jun-97 31 62,200
20-Jun-97 29.875 45,200
23-Jun-97 30 15,000
24-Jun-97 29.625 11,900
25-Jun-97 29.125 46,500
26-Jun-97 28.313 34,800
27-Jun-97 28.188 58,700
30-Jun-97 28.125 66,900
1-Jul-97 28.125 23,000
2-Jul-97 28.5 67,600
3-Jul-97 28.75 55,400
4-Jul-97 28.75 NA
7-Jul-97 29.25 35,800
8-Jul-97 29.25 49,600
9-Jul-97 29.375 32,100
10-Jul-97 29.313 37,600
11-Jul-97 29.375 15,800
14-Jul-97 29.438 25,200
15-Jul-97 29.438 63,900
16-Jul-97 29.563 34,200
17-Jul-97 29.563 22,600
18-Jul-97 29.563 36,900
21-Jul-97 $29.31 7,900
22-Jul-97 29.313 7,800
23-Jul-97 29.313 17,000
24-Jul-97 29.25 16,200
25-Jul-97 29.188 3,400
28-Jul-97 29.313 29,400
29-Jul-97 29.063 2,900
30-Jul-97 29.25 23,500
31-Jul-97 29.188 20,200
1-Aug-97 29.375 67,600
4-Aug-97 29.375 37,600
5-Aug-97 29.438 43,500
6-Aug-97 29.188 4,600
7-Aug-97 29.25 18,000
8-Aug-97 28.625 21,200
11-Aug-97 28.625 16,200
12-Aug-97 28.75 44,100
13-Aug-97 28.5 17,900
14-Aug-97 28.375 12,500
15-Aug-97 27.25 28,400
18-Aug-97 28 48,500
19-Aug-97 27.875 34,100
20-Aug-97 28.188 14,000
21-Aug-97 28.25 11,600
22-Aug-97 28.063 35,200
25-Aug-97 28.125 6,900
26-Aug-97 28.813 18,800
27-Aug-97 28.688 28,500
28-Aug-97 28.438 29,400
29-Aug-97 28.625 40,000
1-Sep-97 28.625 NA
2-Sep-97 28.375 39,600
3-Sep-97 28.188 15,900
4-Sep-97 28.188 21,400
5-Sep-97 28.125 59,000
8-Sep-97 28.188 8,100
9-Sep-97 28.5 94,800
10-Sep-97 28.188 6,700
11-Sep-97 28.5 111,700
12-Sep-97 30.375 33,100
15-Sep-97 $30.31 62,300
16-Sep-97 30.375 17,700
17-Sep-97 30.25 38,800
18-Sep-97 30.375 2,500
19-Sep-97 30.188 10,500
22-Sep-97 30.375 18,400
23-Sep-97 30.375 15,900
24-Sep-97 30.563 18,400
25-Sep-97 30.563 40,400
26-Sep-97 30.75 12,400
29-Sep-97 30.813 3,800
30-Sep-97 30.5 13,600
1-Oct-97 31 24,300
2-Oct-97 30.938 24,300
3-Oct-97 31 29,300
6-Oct-97 30.938 12,600
7-Oct-97 30.375 22,000
8-Oct-97 30.125 58,500
9-Oct-97 30 15,200
10-Oct-97 30.063 45,800
13-Oct-97 30 4,500
14-Oct-97 29.875 37,700
15-Oct-97 30 25,500
16-Oct-97 30.438 27,200
17-Oct-97 30.063 47,300
20-Oct-97 30 30,500
21-Oct-97 30.125 42,700
22-Oct-97 30.063 14,600
23-Oct-97 30 18,900
24-Oct-97 30 20,100
27-Oct-97 29.5 35,400
28-Oct-97 28.813 30,800
29-Oct-97 28.75 4,200
30-Oct-97 28.813 9,800
31-Oct-97 29.25 19,200
3-Nov-97 29.125 15,500
4-Nov-97 29.375 9,300
5-Nov-97 29.563 7,600
6-Nov-97 30.125 26,100
7-Nov-97 29.25 71,500
10-Nov-97 $29.44 24,100
11-Nov-97 29.313 1,900
12-Nov-97 29.75 53,800
13-Nov-97 29 29,400
14-Nov-97 29.563 3,900
17-Nov-97 30 12,000
18-Nov-97 30.125 8,900
19-Nov-97 30.125 1,300
20-Nov-97 30.125 42,900
21-Nov-97 30 110,900
24-Nov-97 29.625 9,800
25-Nov-97 30.188 9,100
26-Nov-97 30.688 53,200
27-Nov-97 30.688 NA
28-Nov-97 31 35,900
1-Dec-97 31.5 59,600
2-Dec-97 31.563 2,300
3-Dec-97 31.625 45,600
4-Dec-97 31.375 1,200
5-Dec-97 31.125 48,300
8-Dec-97 31 106,200
<PAGE>
[Graphic Omitted
The data below were used in constructing the graph titled
LTM Trading Performance Summary]
Schooner Sloop Comps S&P 400
---------- --------- --------- ---------
9-Dec-96 100.00% 100.00% 100.00% 100.00%
10-Dec-96 99.00% 98.50% 99.40% 99.60%
11-Dec-96 98.50% 99.30% 98.70% 98.90%
12-Dec-96 97.00% 97.00% 98.60% 97.50%
13-Dec-96 96.40% 97.00% 97.70% 97.30%
16-Dec-96 93.90% 97.00% 96.90% 96.20%
17-Dec-96 94.40% 98.50% 95.20% 96.70%
18-Dec-96 92.40% 98.50% 96.50% 97.60%
19-Dec-96 93.40% 97.80% 97.50% 99.30%
20-Dec-96 95.40% 98.50% 98.70% 99.60%
23-Dec-96 91.90% 97.00% 98.90% 99.40%
24-Dec-96 92.40% 94.80% 99.50% 100.00%
25-Dec-96 92.40% 94.80% 99.50% 100.00%
26-Dec-96 92.90% 95.50% 100.20% 100.60%
27-Dec-96 95.40% 97.00% 102.10% 100.70%
30-Dec-96 95.40% 94.80% 102.70% 100.30%
31-Dec-96 97.00% 97.80% 103.70% 98.70%
1-Jan-97 97.00% 97.80% 103.70% 98.70%
2-Jan-97 97.00% 99.30% 101.60% 98.40%
3-Jan-97 98.50% 100.00% 101.80% 99.90%
6-Jan-97 98.00% 106.00% 101.20% 99.90%
7-Jan-97 98.00% 110.40% 102.60% 100.70%
8-Jan-97 97.00% 110.40% 102.80% 99.90%
9-Jan-97 94.40% 111.20% 103.20% 100.70%
10-Jan-97 94.90% 111.20% 103.50% 101.60%
13-Jan-97 93.90% 117.90% 103.20% 101.50%
14-Jan-97 94.40% 116.40% 104.40% 102.60%
15-Jan-97 91.90% 114.20% 103.40% 102.30%
16-Jan-97 92.90% 111.20% 103.40% 102.80%
17-Jan-97 93.40% 110.40% 103.50% 103.60%
20-Jan-97 92.90% 113.40% 104.40% 103.60%
21-Jan-97 93.90% 112.70% 105.00% 104.40%
22-Jan-97 92.90% 112.70% 105.00% 104.70%
23-Jan-97 92.40% 114.20% 103.10% 103.50%
24-Jan-97 91.40% 111.20% 102.20% 102.60%
27-Jan-97 90.40% 111.90% 101.60% 101.90%
28-Jan-97 90.40% 112.70% 101.50% 101.90%
29-Jan-97 89.30% 114.20% 101.70% 102.90%
30-Jan-97 90.40% 114.90% 102.80% 104.50%
31-Jan-97 90.40% 115.70% 103.40% 104.70%
3-Feb-97 91.40% 114.90% 103.10% 104.70%
4-Feb-97 91.90% 115.70% 103.80% 104.90%
5-Feb-97 92.90% 115.70% 104.60% 103.30%
6-Feb-97 95.40% 114.90% 104.60% 103.50%
7-Feb-97 94.90% 114.90% 105.60% 104.70%
10-Feb-97 95.40% 112.70% 104.90% 104.00%
11-Feb-97 97.00% 113.40% 104.70% 104.60%
12-Feb-97 97.00% 113.40% 104.60% 106.50%
13-Feb-97 97.00% 113.40% 105.90% 107.50%
14-Feb-97 97.50% 113.40% 106.70% 106.90%
17-Feb-97 97.50% 113.40% 106.70% 106.90%
18-Feb-97 100.50% 112.70% 106.30% 107.90%
19-Feb-97 100.00% 113.40% 106.60% 107.40%
20-Feb-97 100.00% 111.20% 106.00% 106.30%
21-Feb-97 98.50% 111.90% 105.60% 106.10%
24-Feb-97 98.50% 111.90% 106.10% 107.20%
25-Feb-97 99.50% 111.90% 106.30% 107.40%
26-Feb-97 99.50% 109.00% 105.90% 106.70%
27-Feb-97 99.00% 112.70% 106.20% 105.30%
28-Feb-97 99.00% 113.40% 105.90% 104.80%
3-Mar-97 100.50% 114.20% 105.30% 105.30%
4-Mar-97 100.50% 112.70% 106.00% 104.60%
5-Mar-97 99.50% 113.40% 106.00% 106.10%
6-Mar-97 99.50% 113.40% 106.90% 105.50%
7-Mar-97 99.00% 120.10% 108.10% 106.10%
10-Mar-97 100.50% 123.10% 108.30% 107.30%
11-Mar-97 99.50% 126.90% 109.30% 107.10%
12-Mar-97 99.00% 125.40% 108.60% 106.20%
13-Mar-97 97.50% 124.60% 107.30% 104.60%
14-Mar-97 98.00% 125.40% 108.50% 105.10%
17-Mar-97 97.00% 124.60% 107.80% 105.50%
18-Mar-97 96.40% 125.40% 107.30% 104.80%
19-Mar-97 95.40% 123.90% 107.40% 104.20%
20-Mar-97 94.90% 123.90% 107.50% 103.80%
21-Mar-97 95.40% 118.70% 106.80% 103.80%
24-Mar-97 95.40% 120.10% 106.40% 104.60%
25-Mar-97 94.90% 120.10% 105.60% 104.40%
26-Mar-97 95.40% 124.60% 105.00% 105.00%
27-Mar-97 95.90% 123.90% 104.50% 102.90%
28-Mar-97 95.90% 123.90% 104.50% 102.90%
31-Mar-97 95.40% 122.40% 103.40% 100.90%
1-Apr-97 98.00% 125.40% 103.80% 101.00%
2-Apr-97 96.40% 123.90% 103.70% 99.90%
3-Apr-97 96.40% 124.60% 102.80% 99.80%
4-Apr-97 97.00% 123.90% 103.40% 101.00%
7-Apr-97 96.40% 126.10% 104.20% 101.50%
8-Apr-97 97.00% 127.60% 104.50% 101.80%
9-Apr-97 97.00% 126.90% 103.80% 101.20%
10-Apr-97 94.90% 126.90% 103.60% 100.90%
11-Apr-97 94.90% 126.10% 102.20% 98.20%
14-Apr-97 93.40% 124.60% 102.20% 99.10%
15-Apr-97 93.40% 123.90% 102.80% 100.60%
16-Apr-97 93.90% 119.40% 104.20% 102.00%
17-Apr-97 93.90% 119.40% 103.80% 101.60%
18-Apr-97 93.90% 119.40% 104.30% 102.40%
21-Apr-97 94.40% 116.40% 103.70% 101.70%
22-Apr-97 95.40% 117.90% 104.50% 103.70%
23-Apr-97 93.90% 118.70% 105.60% 103.60%
24-Apr-97 95.40% 117.90% 106.20% 103.30%
25-Apr-97 94.90% 116.40% 106.00% 102.40%
28-Apr-97 97.50% 112.70% 106.20% 103.20%
29-Apr-97 99.50% 114.20% 107.10% 105.90%
30-Apr-97 100.00% 114.20% 108.10% 106.90%
1-May-97 100.00% 115.70% 108.90% 106.50%
2-May-97 101.50% 115.70% 111.00% 108.30%
5-May-97 105.60% 117.20% 113.00% 110.80%
6-May-97 107.10% 118.70% 112.40% 110.20%
7-May-97 104.60% 116.40% 111.90% 108.90%
8-May-97 103.60% 114.20% 112.40% 109.50%
9-May-97 104.60% 118.70% 113.40% 110.00%
12-May-97 107.60% 119.40% 115.60% 111.80%
13-May-97 106.10% 120.10% 115.40% 111.30%
14-May-97 107.60% 119.40% 115.00% 111.50%
15-May-97 105.10% 119.40% 115.70% 112.50%
16-May-97 106.60% 120.10% 114.80% 110.90%
19-May-97 107.60% 118.70% 114.90% 111.50%
20-May-97 108.60% 123.10% 114.10% 112.50%
21-May-97 109.10% 124.60% 115.30% 112.50%
22-May-97 112.20% 126.10% 115.80% 111.90%
23-May-97 114.20% 127.60% 117.90% 113.40%
26-May-97 114.20% 127.60% 117.90% 113.40%
27-May-97 115.20% 139.60% 117.50% 114.20%
28-May-97 114.20% 139.60% 117.70% 113.70%
29-May-97 113.70% 135.80% 118.50% 113.30%
30-May-97 115.20% 133.60% 117.40% 113.50%
2-Jun-97 115.20% 133.60% 118.50% 113.30%
3-Jun-97 117.80% 130.60% 119.00% 112.90%
4-Jun-97 116.80% 128.40% 118.70% 112.10%
5-Jun-97 117.80% 126.90% 119.00% 112.50%
6-Jun-97 118.30% 122.40% 119.50% 114.40%
9-Jun-97 119.30% 126.10% 119.50% 115.30%
10-Jun-97 119.80% 126.90% 120.80% 115.50%
11-Jun-97 119.30% 121.60% 120.70% 116.00%
12-Jun-97 119.30% 121.60% 122.50% 117.90%
13-Jun-97 119.80% 122.40% 122.50% 119.20%
16-Jun-97 121.80% 120.90% 121.30% 119.30%
17-Jun-97 123.40% 121.60% 121.20% 119.40%
18-Jun-97 123.90% 122.40% 120.60% 118.30%
19-Jun-97 125.90% 122.40% 120.60% 119.50%
20-Jun-97 121.30% 120.10% 119.80% 119.70%
23-Jun-97 121.80% 118.70% 117.70% 117.00%
24-Jun-97 120.30% 120.10% 119.60% 119.40%
25-Jun-97 118.30% 120.90% 119.00% 118.60%
26-Jun-97 115.00% 122.40% 117.60% 117.90%
27-Jun-97 114.50% 123.50% 118.60% 118.40%
30-Jun-97 114.20% 124.60% 117.50% 118.30%
1-Jul-97 114.20% 122.40% 119.20% 118.90%
2-Jul-97 115.70% 121.60% 120.40% 120.50%
3-Jul-97 116.80% 119.40% 121.10% 122.20%
4-Jul-97 116.80% 119.40% 121.10% 122.20%
7-Jul-97 118.80% 120.90% 121.00% 121.70%
8-Jul-97 118.80% 123.90% 120.30% 122.70%
9-Jul-97 119.30% 124.30% 120.10% 121.30%
10-Jul-97 119.00% 125.00% 121.30% 122.10%
11-Jul-97 119.30% 123.50% 122.90% 122.50%
14-Jul-97 119.50% 123.90% 123.90% 122.90%
15-Jul-97 119.50% 124.60% 124.00% 124.10%
16-Jul-97 120.10% 124.30% 125.40% 125.50%
17-Jul-97 120.10% 122.40% 125.20% 124.90%
18-Jul-97 120.10% 122.80% 122.80% 122.70%
21-Jul-97 119.00% 123.10% 121.70% 122.30%
22-Jul-97 119.00% 123.90% 123.90% 125.20%
23-Jul-97 119.00% 125.00% 124.70% 125.50%
24-Jul-97 118.80% 125.40% 125.90% 125.80%
25-Jul-97 118.50% 125.70% 123.50% 125.60%
28-Jul-97 119.00% 126.90% 125.90% 125.20%
29-Jul-97 118.00% 127.20% 128.70% 125.70%
30-Jul-97 118.80% 128.40% 131.50% 126.80%
31-Jul-97 118.50% 127.60% 129.10% 126.90%
1-Aug-97 119.30% 123.90% 128.30% 126.20%
4-Aug-97 119.30% 123.90% 129.70% 126.80%
5-Aug-97 119.50% 123.90% 129.30% 127.30%
6-Aug-97 118.50% 125.70% 131.80% 128.30%
7-Aug-97 118.80% 126.50% 131.60% 127.30%
8-Aug-97 116.20% 126.10% 129.20% 125.00%
11-Aug-97 116.20% 126.50% 129.30% 125.20%
12-Aug-97 116.80% 125.00% 128.40% 123.80%
13-Aug-97 115.70% 124.60% 128.20% 123.10%
14-Aug-97 115.20% 124.60% 128.40% 123.40%
15-Aug-97 110.70% 124.30% 126.90% 120.10%
18-Aug-97 113.70% 125.00% 127.20% 121.70%
19-Aug-97 113.20% 124.60% 127.30% 123.60%
20-Aug-97 114.50% 125.70% 129.80% 125.40%
21-Aug-97 114.70% 123.90% 126.80% 123.50%
22-Aug-97 114.00% 125.00% 127.90% 123.30%
25-Aug-97 114.20% 125.40% 127.20% 122.90%
26-Aug-97 117.00% 124.60% 126.20% 121.80%
27-Aug-97 116.50% 124.60% 125.30% 122.00%
28-Aug-97 115.50% 125.70% 125.10% 120.60%
29-Aug-97 116.20% 125.00% 125.50% 120.00%
1-Sep-97 116.20% 125.00% 125.50% 120.00%
2-Sep-97 115.20% 125.70% 125.70% 123.80%
3-Sep-97 114.50% 125.40% 125.80% 123.70%
4-Sep-97 114.50% 125.00% 125.20% 124.10%
5-Sep-97 114.20% 126.10% 125.50% 123.90%
8-Sep-97 114.50% 125.40% 125.80% 123.80%
9-Sep-97 115.70% 128.00% 124.60% 124.20%
10-Sep-97 114.50% 128.00% 122.80% 122.20%
11-Sep-97 115.70% 126.50% 122.70% 121.50%
12-Sep-97 123.40% 125.40% 124.60% 122.90%
15-Sep-97 123.10% 125.40% 124.50% 122.20%
16-Sep-97 123.40% 123.50% 127.30% 125.50%
17-Sep-97 122.80% 123.10% 126.80% 125.00%
18-Sep-97 123.40% 121.30% 127.70% 125.60%
19-Sep-97 122.60% 121.30% 128.10% 126.10%
22-Sep-97 123.40% 122.00% 127.80% 126.80%
23-Sep-97 123.40% 122.00% 128.00% 126.40%
24-Sep-97 124.10% 120.50% 129.20% 125.30%
25-Sep-97 124.10% 123.50% 128.40% 124.50%
26-Sep-97 124.90% 125.70% 128.20% 125.40%
29-Sep-97 125.10% 120.90% 128.70% 126.60%
30-Sep-97 123.90% 122.40% 129.20% 125.70%
1-Oct-97 125.90% 126.50% 130.40% 126.80%
2-Oct-97 125.60% 125.40% 130.80% 127.40%
3-Oct-97 125.90% 125.70% 130.30% 127.80%
6-Oct-97 125.60% 124.30% 131.10% 128.70%
7-Oct-97 123.40% 124.60% 132.10% 130.10%
8-Oct-97 122.30% 122.80% 131.70% 129.00%
9-Oct-97 121.80% 122.40% 132.10% 128.60%
10-Oct-97 122.10% 123.50% 131.70% 128.30%
13-Oct-97 121.80% 122.40% 131.80% 128.30%
14-Oct-97 121.30% 121.60% 132.30% 128.40%
15-Oct-97 121.80% 121.60% 132.30% 127.90%
16-Oct-97 123.60% 122.00% 131.00% 126.30%
17-Oct-97 122.10% 119.40% 130.30% 124.80%
20-Oct-97 121.80% 121.30% 132.60% 126.40%
21-Oct-97 122.30% 119.40% 133.90% 128.50%
22-Oct-97 122.10% 114.90% 133.60% 128.00%
23-Oct-97 121.80% 115.70% 131.30% 125.60%
24-Oct-97 121.80% 114.90% 130.40% 124.30%
27-Oct-97 119.80% 108.20% 123.40% 115.60%
28-Oct-97 117.00% 110.40% 126.10% 121.90%
29-Oct-97 116.80% 114.20% 126.50% 121.20%
30-Oct-97 117.00% 108.20% 125.00% 119.40%
31-Oct-97 118.80% 113.40% 126.70% 120.90%
3-Nov-97 118.30% 117.20% 127.70% 124.20%
4-Nov-97 119.30% 117.90% 128.60% 124.40%
5-Nov-97 120.10% 117.50% 129.00% 124.60%
6-Nov-97 122.30% 117.50% 128.70% 123.90%
7-Nov-97 118.80% 111.60% 127.10% 122.60%
10-Nov-97 119.50% 106.30% 127.40% 121.80%
11-Nov-97 119.00% 106.70% 126.40% 122.40%
12-Nov-97 120.80% 101.90% 124.50% 120.00%
13-Nov-97 117.80% 102.20% 124.50% 121.60%
14-Nov-97 120.10% 98.50% 125.40% 123.30%
17-Nov-97 121.80% 100.70% 125.10% 125.50%
18-Nov-97 122.30% 104.90% 125.30% 124.40%
19-Nov-97 122.30% 101.10% 124.70% 125.10%
20-Nov-97 122.30% 103.70% 125.80% 126.90%
21-Nov-97 121.80% 102.60% 125.50% 127.50%
24-Nov-97 120.30% 101.50% 124.20% 125.30%
25-Nov-97 122.60% 101.50% 124.40% 125.90%
26-Nov-97 124.60% 101.50% 125.20% 125.90%
27-Nov-97 124.60% 101.50% 125.20% 125.90%
28-Nov-97 125.90% 103.40% 125.60% 126.00%
1-Dec-97 127.90% 103.70% 125.90% 128.50%
2-Dec-97 128.20% 105.60% 125.50% 127.90%
3-Dec-97 128.40% 106.00% 124.80% 128.60%
4-Dec-97 127.40% 106.70% 124.60% 127.80%
5-Dec-97 126.40% 106.30% 125.40% 129.30%
8-Dec-97 125.90% 106.70% 125.00% 129.10%
<PAGE>
[Graphic Omitted
The data below were used in constructing the graph titled
Schooner Traded Volume Summary]
Closing Trading
Date Price Volume
- ------------ --------- ----------
29-Jan-97 $22.00 25,000
27-Jan-97 22.25 11,200
28-Jan-97 22.25 43,900
30-Jan-97 22.25 25,700
31-Jan-97 22.25 23,500
24-Jan-97 22.50 22,200
3-Feb-97 22.50 26,000
23-Dec-96 22.63 9,200
15-Jan-97 22.63 21,700
4-Feb-97 22.63 56,200
18-Dec-96 22.75 10,200
24-Dec-96 22.75 9,700
25-Dec-96 22.75 NA
23-Jan-97 22.75 2,800
26-Dec-96 22.88 27,700
16-Jan-97 22.88 4,000
20-Jan-97 22.88 7,200
22-Jan-97 22.88 7,000
5-Feb-97 22.88 16,100
349,300 Total
3.7% % of Total
19-Dec-96 23.00 25,000
17-Jan-97 23.00 130,800
14-Apr-97 23.00 31,700
15-Apr-97 23.00 158,700
16-Dec-96 23.13 9,900
13-Jan-97 23.13 26,100
21-Jan-97 23.13 138,700
16-Apr-97 23.13 49,100
17-Apr-97 23.13 41,800
18-Apr-97 23.13 9,200
23-Apr-97 23.13 24,200
17-Dec-96 23.25 11,100
9-Jan-97 23.25 89,800
14-Jan-97 23.25 19,800
21-Apr-97 23.25 9,000
10-Jan-97 23.38 31,800
7-Feb-97 23.38 6,400
20-Mar-97 23.38 113,600
25-Mar-97 23.38 146,000
10-Apr-97 23.38 69,100
11-Apr-97 23.38 4,700
25-Apr-97 23.38 3,500
20-Dec-96 23.50 9,600
27-Dec-96 23.50 76,200
30-Dec-96 23.50 8,100
6-Feb-97 23.50 46,800
10-Feb-97 23.50 24,400
19-Mar-97 23.50 59,200
21-Mar-97 23.50 184,900
24-Mar-97 23.50 115,300
26-Mar-97 23.50 43,900
31-Mar-97 23.50 49,200
22-Apr-97 23.50 14,100
24-Apr-97 23.50 12,100
27-Mar-97 23.63 70,100
28-Mar-97 23.63 NA
13-Dec-96 23.75 2,000
18-Mar-97 23.75 45,500
2-Apr-97 23.75 52,000
3-Apr-97 23.75 144,800
7-Apr-97 23.75 40,800
12-Dec-96 23.88 3,000
31-Dec-96 23.88 8,100
1-Jan-97 23.88 NA
2-Jan-97 23.88 189,200
8-Jan-97 23.88 91,700
11-Feb-97 23.88 751,500
12-Feb-97 23.88 32,500
13-Feb-97 23.88 121,500
17-Mar-97 23.88 32,000
4-Apr-97 23.88 42,000
8-Apr-97 23.88 10,100
9-Apr-97 23.88 75,100
2,569,300 Total
27.4% % of Total
14-Feb-97 24.00 113,000
17-Feb-97 24.00 NA
13-Mar-97 24.00 23,600
28-Apr-97 24.00 23,500
6-Jan-97 24.13 5,600
7-Jan-97 24.13 56,300
14-Mar-97 24.13 70,700
1-Apr-97 24.13 33,600
11-Dec-96 24.25 14,500
3-Jan-97 24.25 148,500
21-Feb-97 24.25 93,900
24-Feb-97 24.25 8,900
10-Dec-96 24.38 33,300
27-Feb-97 24.38 11,100
28-Feb-97 24.38 12,200
7-Mar-97 24.38 117,700
12-Mar-97 24.38 37,500
25-Feb-97 24.50 56,600
26-Feb-97 24.50 23,000
5-Mar-97 24.50 120,200
6-Mar-97 24.50 108,200
11-Mar-97 24.50 45,300
29-Apr-97 24.50 15,900
9-Dec-96 24.63 800
19-Feb-97 24.63 81,200
20-Feb-97 24.63 76,700
30-Apr-97 24.63 28,300
1-May-97 24.63 31,300
18-Feb-97 24.75 210,800
3-Mar-97 24.75 97,200
4-Mar-97 24.75 29,000
10-Mar-97 24.75 77,100
1,805,500 Total
19.2% % of Total
2-May-97 25.00 11,300
8-May-97 25.50 39,500
7-May-97 25.75 21,500
9-May-97 25.75 41,800
15-May-97 25.88 7,900
122,000 Total
1.3% % of Total
5-May-97 26.00 29,800
13-May-97 26.13 13,200
16-May-97 26.25 54,300
6-May-97 26.38 49,200
12-May-97 26.50 31,200
14-May-97 26.50 17,100
19-May-97 26.50 11,900
20-May-97 26.75 13,800
21-May-97 26.88 11,500
232,000 Total
2.2% % of Total
15-Aug-97 27.25 28,400
22-May-97 27.63 3,800
19-Aug-97 27.88 34,100
66,300 Total
0.7% % of Total
29-May-97 28.00 6,100
18-Aug-97 28.00 48,500
22-Aug-97 28.06 35,200
23-May-97 28.13 35,600
26-May-97 28.13 NA
28-May-97 28.13 14,400
30-Jun-97 28.13 66,900
1-Jul-97 28.13 23,000
25-Aug-97 28.13 6,900
5-Sep-97 28.13 59,000
27-Jun-97 28.19 58,700
20-Aug-97 28.19 14,000
3-Sep-97 28.19 15,900
4-Sep-97 28.19 21,400
8-Sep-97 28.19 8,100
10-Sep-97 28.19 6,700
21-Aug-97 28.25 11,600
26-Jun-97 28.31 34,800
27-May-97 28.38 109,000
30-May-97 28.38 32,800
2-Jun-97 28.38 6,300
14-Aug-97 28.38 12,500
2-Sep-97 28.38 39,600
28-Aug-97 28.44 29,400
2-Jul-97 28.50 67,600
13-Aug-97 28.50 17,900
9-Sep-97 28.50 94,800
11-Sep-97 28.50 111,700
8-Aug-97 28.63 21,200
11-Aug-97 28.63 16,200
29-Aug-97 28.63 40,000
1-Sep-97 28.63 NA
27-Aug-97 28.69 28,500
4-Jun-97 28.75 25,200
3-Jul-97 28.75 55,400
4-Jul-97 28.75 NA
12-Aug-97 28.75 44,100
29-Oct-97 28.75 4,200
26-Aug-97 28.81 18,800
28-Oct-97 28.81 30,800
30-Oct-97 28.81 9,800
1,282,600 Total
13.7% % of Total
3-Jun-97 29.00 58,600
5-Jun-97 29.00 38,800
13-Nov-97 29.00 29,400
29-Jul-97 29.06 2,900
6-Jun-97 29.13 47,400
25-Jun-97 29.13 46,500
3-Nov-97 29.13 15,500
25-Jul-97 29.19 3,400
31-Jul-97 29.19 20,200
6-Aug-97 29.19 4,600
7-Jul-97 29.25 35,800
8-Jul-97 29.25 49,600
24-Jul-97 29.25 16,200
30-Jul-97 29.25 23,500
7-Aug-97 29.25 18,000
31-Oct-97 29.25 19,200
7-Nov-97 29.25 71,500
10-Jul-97 29.31 37,600
21-Jul-97 29.31 7,900
22-Jul-97 29.31 7,800
23-Jul-97 29.31 17,000
28-Jul-97 29.31 29,400
11-Nov-97 29.31 1,900
9-Jun-97 29.38 54,800
11-Jun-97 29.38 5,300
12-Jun-97 29.38 38,100
9-Jul-97 29.38 32,100
11-Jul-97 29.38 15,800
1-Aug-97 29.38 67,600
4-Aug-97 29.38 37,600
4-Nov-97 29.38 9,300
14-Jul-97 29.44 25,200
15-Jul-97 29.44 63,900
5-Aug-97 29.44 43,500
10-Nov-97 29.44 24,100
10-Jun-97 29.50 73,600
13-Jun-97 29.50 32,000
27-Oct-97 29.50 35,400
16-Jul-97 29.56 34,200
17-Jul-97 29.56 22,600
18-Jul-97 29.56 36,900
5-Nov-97 29.56 7,600
14-Nov-97 29.56 3,900
24-Jun-97 29.63 11,900
24-Nov-97 29.63 9,800
12-Nov-97 29.75 53,800
20-Jun-97 29.88 45,200
14-Oct-97 29.88 37,700
1,424,600 Total
15.2% % of Total
16-Jun-97 30.00 42,100
23-Jun-97 30.00 15,000
9-Oct-97 30.00 15,200
13-Oct-97 30.00 4,500
15-Oct-97 30.00 25,500
20-Oct-97 30.00 30,500
23-Oct-97 30.00 18,900
24-Oct-97 30.00 20,100
17-Nov-97 30.00 12,000
21-Nov-97 30.00 110,900
10-Oct-97 30.06 45,800
17-Oct-97 30.06 47,300
22-Oct-97 30.06 14,600
8-Oct-97 30.13 58,500
21-Oct-97 30.13 42,700
6-Nov-97 30.13 26,100
18-Nov-97 30.13 8,900
19-Nov-97 30.13 1,300
20-Nov-97 30.13 42,900
19-Sep-97 30.19 10,500
25-Nov-97 30.19 9,100
17-Sep-97 30.25 38,800
15-Sep-97 30.31 62,300
17-Jun-97 30.38 64,900
12-Sep-97 30.38 33,100
16-Sep-97 30.38 17,700
18-Sep-97 30.38 2,500
22-Sep-97 30.38 18,400
23-Sep-97 30.38 15,900
7-Oct-97 30.38 22,000
16-Oct-97 30.44 27,200
18-Jun-97 30.50 37,500
30-Sep-97 30.50 13,600
24-Sep-97 30.56 18,400
25-Sep-97 30.56 40,400
26-Nov-97 30.69 53,200
27-Nov-97 30.69 NA
26-Sep-97 30.75 12,400
29-Sep-97 30.81 3,800
2-Oct-97 30.94 24,300
6-Oct-97 30.94 12,600
1,121,400 Total
11.9% % of Total
19-Jun-97 31.00 62,200
1-Oct-97 31.00 24,300
3-Oct-97 31.00 29,300
28-Nov-97 31.00 35,900
8-Dec-97 31.00 106,200
5-Dec-97 31.13 48,300
4-Dec-97 31.38 1,200
1-Dec-97 31.50 59,600
2-Dec-97 31.56 2,300
3-Dec-97 31.63 45,600
414,900 Total
4.2% % of Total
Total 9.3 million
<PAGE>
Confidential Project Yacht
- -------------------------------------------------------------------------------
Summary of Significant Holdings - Schooner and Sloop
<TABLE>
<CAPTION>
(shares in thousands)
Schooner Sloop
------------------------------------ ----------------------------------
As a % As a % of As a % As a % of
Shares Of Total Public Float Shares Of Total Public Float
------ -------- ------------ ------ -------- ------------
<S> <C> <C> <C> <C> <C> <C>
Cramer Rosenthal McGlynn ..... 1,128 2.7% 5.5% 3,992 8.4% 11.7%
Fidelity Mgmt & Res Corp ..... 3,921 9.5% 19.0% 117 0.2% 0.3%
T Rowe Price Associates ...... 3,975 9.6% 19.3% 0 0.0% 0.0%
Grantham Mayo Van Otter ...... 0 0.0% 0.0% 1,518 3.2% 4.4%
Barclays Bank Plc............. 356 0.9% 1.7% 899 1.9% 2.6%
Babson David L C Co .......... 989 2.4% 4.8% 16 0.0% 0.0%
Mellon Bank Corporation ...... 234 0.6% 1.1% 760 1.6% 2.2%
Geocapital Corporation ....... 0 0.0% 0.0% 982 2.1% 2.9%
Wellington Management Co ..... 0 0.0% 0.0% 923 1.9% 2.7%
First Chicago Nbd Corp ....... 825 2.0% 4.0% 20 0.0% 0.1%
Pimco Advisors L P ........... 0 0.0% 0.0% 702 1.5% 2.0%
Numeric Investors L P ........ 0 0.0% 0.0% 618 1.3% 1.8%
AIM Mgmt Group Inc. .......... 0 0.0% 0.0% 549 1.2% 1.6%
Rainier Invt Mgmt Inc ........ 0 0.0% 0.0% 546 1.2% 1.6%
Skyline Asset Mgmt Lp ........ 531 1.3% 2.6% 0 0.0% 0.0%
Prudential Ins Co/Amer ....... 0 0.0% 0.0% 519 1.1% 1.5%
Ohio State Teach Ret Sys ..... 500 1.2% 2.4% 0 0.0% 0.0%
Nicholas-Applegate Cap........ 28 0.1% 0.1% 441 0.9% 1.3%
Invista Capital Mgmt Inc ..... 422 1.0% 2.0% 0 0.0% 0.0%
Bankers Trust N Y Corp ....... 109 0.3% 0.5% 299 0.6% 0.9%
Zurich Kemper Invts Inc ...... 400 1.0% 1.9% 0 0.0% 0.0%
First Pacific Advisors ....... 392 0.9% 1.9% 0 0.0% 0.0%
Travelers Inc ................ 14 0.0% 0.1% 369 0.8% 1.1%
------ ----- ----- ------ ----- -----
Total ........................ 13,823 33.5% 67.2% 13,269 28.0% 38.8%
Other Institutions ........... 2,669 6.5% 13.0% 4,678 9.9% 13.7%
------ ----- ----- ------ ----- -----
Total Institutions ........... 16,492 39.9% 80.1% 17,947 37.9% 52.4%
Total Retail and Other ....... 4,093 9.9% 19.9% 16,292 34.4% 47.6%
Insiders:
Affiliated Directors ......... 1,912 4.6% 5,220 11.0%
Fellini ...................... 1,584 3.8% 7,825 16.5%
Other Directors and Executives 2,053 5.0% 94 0.2%
Sloop ........................ 15,191 36.8% 0 0.0%
------ ----- ------ -----
Total Insiders ............... 20,740 50.2% 13,139 27.7%
------ ------
Total Shares Outstanding ..... 41,325 47,378
</TABLE>
___________________
Notes:
The top five institutional holders of Schooner's stock own 52.6% of the public
float.
<PAGE>
- ---------------------------------------------------------------------------
Stand Alone Financial Analysis
- ---------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Summary of Financial Assumptions - Sloop(1)
(Dollars in Millions, Except Per Share Data)
1997(2) 1998 1999
-------- -------- ---------
Revenue ....................... $ 911.0 $ 975.0 $ 1,075.0
Revenue Growth ................ 4.7%(3) 7.0% 10.3%
EBITDA ........................ 150.5 165.5 183.2
EBITDA Margin ................. 16.5% 17.0% 17.0%
EBIT .......................... 106.0 119.0 135.0
EBIT Margin ................... 11.6% 12.2% 12.6%
Net Income .................... 70.3 87.7 102.7
Fully-Diluted EPS ............. $ 1.47 $ 1.67 $ 1.92
___________________
NOTES:
(1) Based on Sloop management estimates; 1997 reflects recent divestitures.
(2) From operations; excludes extraordinary gains and charges from the
disposition of assets and the sale of investments; reflects dilution of
convertible subordinated debentures.
(3) Growth rate based on 1996 revenues adjusted to exclude discontinued
operations.
<PAGE>
Confidential - Project Yacht
- -----------------------------------------------------------------------------
Summary of Financial Assumptions - Schooner(1)
(Dollars in Millions, Except Per Share Data)
1997 1998 1999
------- ------- ------
Revenue ........................ $ 666.0 $ 717.6 $767.6
Revenue Growth ................. 10.9% 7.8% 7.0%
EBITDA ......................... 141.5 157.0 171.4
EBITDA Margin .................. 21.3% 21.9% 22.3%
EBIT ........................... 115.6 128.3 139.7
EBlT Margin ..................... 17.4% 17.9% 18.2%
Net Income ..................... 72.5 81.7 91.5
Fully-Diluted EPS .............. $ 1.74 $ 1.96 $ 2.19
- -------------------
NOTES:
(1) Based on Schooner management estimates.
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Schooner Capital Structure
(Dollars in millions)
Balance Sheet Data As of 9/30/97 (1)
- -----------------------------------------------------------------------------
Cash $126.0 Current Liabilities $66.5
Other Current Assets 188.4 Debt 71.6
PP&E 194.7 Other Liabilities 47.6
Other Assets 218.0 Shareholders' Equity 541.4
------ ------
Total Liabilities &
Total Assets $727.1 Shareholders' Equity $727.1
Net Current Assets $247.8
Net Debt (54.4)
Total Debt/Total Capitalization 11.7%
Net Debt/Total Capitalization NM
- ----------------
NOTES:
(1) Source: 1O-Q filing for quarter ended 9/30/97.
<PAGE>
- -----------------------------------------------------------------------------
Transaction Overview
- -----------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Transaction Overview
Offer Price: o $34.50 per share
Form of Consideration/ o Cash tender offer
Transaction Structure:
Board Approval (both companies): o Recommendation of the Special Committee
o Approval by Full Board of Directors
No Solicitation: o Schooner has agreed not to solicit,
initiate or take any action to
facilitate any merger, consolidation,
combination, sale or other transaction
that would impede, prevent or delay the
proposed transaction, provided that
such action will not cause the Schooner
Board to breach its fiduciary duties
Break-Up Fees: o Schooner has agreed to pay Sloop a fee
of $10 million if the recommendation of
the Schooner Board or Special Committee
is withdrawn or modified as a result of
an Acquisition Proposal (as defined)
and, within 12 months after termination
of the proposed transaction Schooner
enters into an agreement in respect of
the Acquisition Proposal which is
subsequently consummated
Mutual Expense Reimbursement: o Expense reimbursement of up to $5
million in reasonable out-of-pocket
expenses incurred in connection with
the proposed transaction to the
non-breaching party for material
breaches of representations, warranties
or covenants of the other party
Minimum Condition of Tender Offer: o Majority of outstanding shares
(41,325,118 outstanding as of 11/30/97)
excluding shares owned by Sloop, Fellini
and RAM (18,576,669 shares or 45.0%) and
excluding Schooner restricted award
shares (854,880 shares or 2.1 %)
o Shares required excluding affiliates:
Approx. 10.95 million
(26.5% of the total shares)
o Shares required including affiliates:
Approx. 29.52 million
(71.4% of the total shares)
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Transaction Overview
Term of Offer: o No obligation to extend beyond 60 days
after commencement
o If all conditions to the offer have
been satisfied, and if the shares
tendered (including all affiliates
shares) do not exceed 90% of the total
shares, Sloop may extend for up to 10
business days to solicit additional
shares
Shares Eligible for Tender: o All shares owned by Sloop are canceled
o All shares in Schooner treasury stock
are canceled
o All Schooner restricted shares are
rolled into Sloop restricted shares
o Fellini and RAM intend to tender all
shares
o Sloop agrees to vote all shares in favor
of a transaction
Financing: o Sloop has a written financing commitment
o At the time of acceptance for payment,
Sloop will have the funds necessary to
consummate the offer
Closing: o As soon as practicable after all
conditions have been met
<PAGE>
- ---------------------------------------------------------------------------
Valuation Analysis
- ---------------------------------------------------------------------------
<PAGE>
[Graphic Omitted
Data extracted from the following page
"Mean" values were used in constructing the graph titled
Valuation Summary Schooner]
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Valuation Summary - Schooner
(Dollars in Millions, Except Per Share Data)
Comparable Companies
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Multiple Range Enterprise Value (1) Equity Value Per Share(l)
Financial --------------- -------------------- -------------------------
Statistics Low High Low High Low High
---------- ----- ---- --------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
LTM EBITDA ... $ 138.4 7.2x 10.5x $ 991.2 $ 1,453.5 $ 25.44 $ 36.52
LTM EBIT ..... 113.3 9.4 14.7 1,062.5 1,663.9 27.15 41.57
1997 EPS ..... $ 1.74 13.2x 21.5x $ 889.6 $ 1,485.2 $ 23.00 $ 37.28
1998 EBITDA .. $ 157.0 6.6x 9.3x $ 1,034.9 $ 1,460.5 $ 26.49 $ 36.69
1998 EBIT .... 128.3 8.5 12.4 1,083.8 1,591.7 27.66 39.84
1998 EPS ..... $ 1.96 11.6 18.3 879.1 1,425.4 22.75 35.85
Mean: .................... $25.41 $37.96
</TABLE>
<TABLE>
<CAPTION>
Precedent Transactions
- ------------------------------------------------------------------------------------------------------
Multiple Range Enterprise Value (1) Equity Value Per Share(l)
Financial --------------- -------------------- -------------------------
Statistics Low High Low High Low High
---------- ----- ---- --------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
LTM EBITDA ... $ 138.4 7.1x 15.4x $ 988.4 $ 2,136.0 $ 25.37 $ 52.89
LTM EBIT ..... 113.3 9.1 16.3 1,031.9 1,841.8 26.41 45.83
LTM EPS ...... $ 1.68 12.2x 24.8x $ 783.6 $ 1,669.2 $ 20.46 $ 41.69
Forward EBITDA $ 157.0(2) 6.3x 13.8x $ 983.1 $ 2,171.9 $ 25.24 $ 53.75
Forward EBIT . 128.3(2) 8.0 14.5 1,028.6 1,858.5 26.34 46.23
Mean: .................... $24.76 $48.08
</TABLE>
- -----------------
NOTES:
LTM data as of 9/30/97
(1) Based upon estimated December 31, 1997 net debt of -$69.8 million
(2) Forward multiples applied to 1998 financial statistics
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Valuation Summary - Schooner
(Dollars in Millions, Except Per Share Data)
Discounted Cash Flow
- -----------------------------------------------------------------------------
Based on an EBITDA terminal multiple range Equity Value Per Share(l)
of 8.0x to 10.0x and a discount rate of -------------------------
11.0% to 13.0% Low High
------ ------
Mean: $33.64 $42.97
Premiums Paid in Affiliated Party Transactions
- ------------------------------------------------------------------------------
Equity Value
Per Share
Closing ------------------
Prices (2) Premium(3) Low High
---------- ---------------- --------- --------
Low High
----- ------
1 Day Prior to Announcement $30.88 27.4% 30.5% $39.33 $40.29
4 Weeks Prior to Announcement 29.31 33.6% 34.8% 39.17 39.51
Mean: $39.25 $39.90
Current Trading Statistics
- -------------------------------------------------------------------------------
Equity Value Per Share
----------------------
Low High
------------ ---------
52-Week Range (12/09/97) $22.00 $31.63
Current Share Price (12/O9/97) $30.88
4 Week Average Price (12/09/97) $30.44
Six-Month Average Price (l2/09/97) $29.52
- -----------------
NOTES: LTM data as of 9/30/97
(1) Based upon estimated December 31, 1997 net debt of -$69.8 million
(2) As of December 9, 1997 and November 11, 1997, respectively
(3) Premiums paid range based on the mean and median
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Valuation Matrix
(Dollars in Millions, Except Per Share Data)
<TABLE>
<CAPTION>
Enterprise Value/
-------------------------------------------------- Equity Value
LTM 1997E 1998E Net Income
Price Equity Enterprise ---------------- -------------- -------------- --------------
Per Share Value Value (1) EBITDA EBIT EBITDA EBIT EBITDA EBIT 1997E 1998E
- ---------- ------ ----------- ------- ------- ------ ------ ------ ------ ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Schooner Result - Aggregate $138.4 $113.3 $141.5 $115.6 $157.0 $128.3 $72.5 $81.7
- Per Share $1.74 $1.96
$ 30.50 $ 1,272.6 $ 1,202.8 8.7x 10.6x 8.5x 10.4x 7.7x 9.4x 17.6x 15.6x
31.50 1,314.3 1,244.6 9.0 11.0 8.8 10.8 7.9 9.7 18.1 16.1
32.50 1,356.1 1,286.3 9.3 11.4 9.1 11.1 8.2 10.0 18.7 16.6
33.50 1,397.8 1,328.0 9.6 11.7 9.4 11.5 8.5 10.4 19.3 17.1
34.50 1,439.5 1,369.7 9.9 12.1 9.7 11.9 8.7 10.7 19.9 17.6
</TABLE>
- -----------------
NOTES:
(1) Based upon estimated December 31, 1997 net debt of -$69.8 million.
<PAGE>
- ----------------------------------------------------------------------------
Pro Forma Effect of the Transaction
- ----------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Financial Overview
Transaction Assumptions:
o Purchase accounting is applied
o Goodwill adjustments
- No restatement for SAB #51 gain made based on review of Sloop's
accounting advisors
- Reduce goodwill by $39 million as a result of the combination
- Removal of a deferred tax liability previously recognized
from non-cash income from Schooner
o Schooner shares owned by Sloop are retired
- Lower goodwill relative to a third party transaction
- No tax related to the retirement
o Annual pre-tax synergies/cost savings of $4 million
- Lower corporate overhead/public company costs
- Less than 2% of combined S,G&A
o Sloop's 4 1/2% Convertible Subordinated Debentures remain
outstanding
o Inter-company sales of products and services and other transactions
are not eliminated due to immateriality
- $4 million booked by Sloop and $0.4 million booked by Schooner
in 1996
o Holders of Schooner options will receive the difference between the
the offer price and strike price for each option
- Schooner restricted award shares will be replaced with Sloop
restricted shares
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Financing Plan
Prior to announcement, Sloop expects to have a commitment from First
Chicago/NBD, Bank of America and Nationsbank for a $1.3 billion credit
facility, $1.1 billion to be funded at the consummation of the transaction
to fund the acquisition and refinance existing bank indebtedness. The
terms of the commitment are summarized as follows:
Total Facility: o $1.3 billion total facility
o $800 million revolving credit (approximately $600
million to be drawn at closing after giving effect
to excess cash on the balance sheet)
o $500 million term loan due in year 2003
Pricing: o Initial: LIBOR+ 1.125%
Thereafter, spread to vary based upon matrix
of leverage ratios
General Covenants: o Limitation on liens
- Liens and encumbrances may not exceed 10% of current
assets and 5% of net worth
o Limitation on sale of assets
- Sale of assets may not exceed 10% of total assets
per year
o Limitation on subsidiary indebtedness
- Subsidiary indebtedness (outside of facility) may not
exceed $100 million
o Limitation on restricted payments (dividends, stock
repurchases and subordinated debt repurchases)
- Limitation basket based on a formula of net income,
principal payments and additions to capital stock and
subordinated debt (starting at $40 million)
<PAGE>
Confidential Project Yacht
- ------------------------------------------------------------------------------
Financing Plan
Financial o Fixed charge coverage ratio:
Covenants: - Defined as the ratio of EBITDA minus capital
expenditures to the sum of interest expense, scheduled
debt payments and cash taxes
- Projected coverage approximates 1.4x at 12/31/98 versus
required minimum of l.lx
o Total debt to EBITDA ratio:
- Defined as ratio of total debt to pre-tax earnings,
excluding certain nonoperating gains and losses, plus
interest expense, depreciation and amortization minus
earnings from equity investments in excess of $30
million
- Projected leverage of 3.7x at 12/31/98 versus a re-
quired maximum of 4.5x
o Capitalization test:
- The sum of consolidated net worth, subordinated debt,
and the amount of the subordinated debt borrowed or
borrowable from Fellini under the Amended and Restated
Securities Purchase Agreement dated 11/23/93 must
exceed the sum of $650 million and 60% of the
cumulative positive net income subsequent to the close
of the facility
- At 12/31/98, the Company's "Capitalization" as defined
above is projected to be $831 million, which is in
compliance with the test
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Transaction Summary
(Dollars in Millions, Except Per Share Data)
Overview:
- All cash purchase @ $34.50 per Schooner share
- 100% of Schooner price paid in cash
- Transaction Date: Pro forma analysis as of December 31, 1997 (actual
closing expected in mid-January 1998)
Trading Information:
Schooner
Enterprise Value Sloop Schooner @ $34.50
- ---------------- -------- -------- ---------
Share Price ................. 12/09/97 $ 17.44 $ 30.88 $ 34.50
Premium ..................... -- -- 11.7%
Fully Diluted Shares ........ 58.4 41.7 41.7
Equity Market Value ......... $1,019.0 $1,287.7 $1,439.5
Plus: Debt .................. 191.9 73.3 73.3
Less:Cash ................... (25.0) (143.1) (143.1)
-------- -------- --------
Enterprise Value ............ $1,185.9 $1,218.0 $1,369.7
Multiple Analysis
- -----------------
1997 E P/E Ratio ............ FYE 12/31 11.8x 17.8x 19.9x
1998 E P/E Ratio ............ 10.5x 15.8x 17.6x
1997 E EBITDA ............... 5.3x 8.6x 9.7x
1998 E EBITDA ............... 4.9x 7.8x 8.7x
Net Debt/EBITDA ............. 3.2x N/A --
EBITDA/Net Interest Expense . 4.3x N/A --
Net Debt/Total Capitalization 66% N/A --
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Transaction Summary
(Dollars in Millions, Except Per Share Data)
Sources and Uses of Funds:
Sources of Funds Amount Rate Percent
---------------- -------- ------ -------
Balance Sheet Cash ................. $ 118.1 5.00% 10.0%
Acquisition Debt-Revolver .......... 571.2 7.00% 48.0%
Acquisition Senior Debt 1 -
Term Loan ........................ 500.0 7.00% 42.0%
-------- -------
Total Uses of Funds ................ $1,197.7 100.0%
Uses of Funds
-------------
Schooner Common Equity ............. $ 915.4 76.2%
Existing Senior Debt Schooner ...... 73.3 6.1%
Existing Senior Debt Sloop ......... 191.9 16.0%
Transaction Costs .................. 9.0 0.8%
Financing Fees ..................... 8.0 0.7%
-------- -------
Total Uses of Funds ................ $1,197.7 100.0%
Goodwill Calculation:
Purchase Price of Schooner Equity .. $915.4
Plus: Other Transaction Costs ...... 9.0
Less: Deferred Tax Elimination ..... 39.0
Less: Book Value of Schooner ....... 417.2
-------
Incremental Transaction Goodwill ... $468.2
-------
Amortization Period (Years) ....... 40.0
Annual Amortization of Transaction
Goodwill.......................... $ 11.7
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Confidential Project Yacht
- --------------------------------------------------------------------------------
Transaction Summary
(Dollars in Millions, Except Per Share Data)
Pro Forma Accretion/(Dilution) Summary:
Pro Forma Estimated
E.P.S. 1997 1998
------ --------- ---------
Sloop Stand Alone E.P.S $ 1.47 $ 1.67
Pro Forma E.P.S 1.57 1.87
Accretion/(Dilution)
--------------------
Dollars $ 0.09 $0.20
Percentage 6.3% 12.2%
Pro forma 1998 Accretion/(Dilution) Synergy Sensitivity
-------------------------------------------------------
Purchase Annual Pre-Tax Synergies
Price ------------------------------------------------------
Per share $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 $7.0
--------- ----- ----- ----- ----- ----- ----- -----
$34.50 10.3% 10.9% 11.6% 12.2% 12.9% 13.5% 14.2%
$0.17 $0.18 $0.19 $0.20 $0.21 $0.23 $0.24
Pro Forma Credit Statistics Summary:
Pro Forma Estimated
1997 1998
FYE 12/31 --------- ---------
EBITDA/Interest Expense (net) 3.0x 3.8x
(EBITDA-Capex)/Interest Expense (net) 2.0 2.6
Net Debt/EBITDA 4.6 4.0
Net Debt/Total Capitalization 84.6% 79.3%
Total Debt/Total Capitalization 85.0% 79.9%
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Transaction Summary
(Dollars in Millions, Except Per Share Data)
Pro Forma Balance Sheet Sloop Schooner
Estimated Estimated Consolidated
Assets 12/31/97 12/31/97 Adjustments Pro Forma
- ------ ----------- --------- ------------ ----------
Cash and Equivalents ............... $ 25.0 $ 143.1 ($ 126.5) $ 41.5
Accounts Receivable ................ 126.0 84.0 0.0 210.0
Inventory .......................... 71.0 94.3 0.0 165.3
Other Current Assets ............... 40.0 4.7 0.0 44.7
--------- ------- ------- ---------
Total Current Assets ............... 262.0 326.0 (126.5) 461.5
Net Property, Plant & Equipment .... 411.5 203.0 0.0 614.5
Transaction Goodwill ............... 0.0 0.0 468.2 468.2
Existing Goodwill .................. 66.6 175.9 0.0 242.5
Deferred Fees ...................... 0.0 0.0 8.0 8.0
Other Intangible Assets ............ 51.0 0.0 0.0 51.0
Investments in Affiliates .......... 284.3 0.0 (139.2) 145.1
Other Assets ....................... 11.0 39.9 0.0 50.9
--------- ------- ------- ---------
Total Assets ....................... $ 1,086.3 $ 744.9 $ 210.5 $ 2,041.7
========= ======= ======= =========
Liabilities and Shareholders' Equity
Accounts Payable ................... 60.0 30.7 0.0 90.7
Other Current Liabilities .......... 98.0 36.3 0.0 134.3
--------- ------- ------- ---------
Total Current Liabilities .......... 158.0 67.0 0.0 225.0
Other Liabilities .................. 0.0 4.0 0.0 4.0
Deferred Tax ....................... 183.4 44.2 (39.0) 188.5
Bank Revolver ...................... 191.9 73.3 (265.2) 0.0
Acquisition Debt - Revolver ........ 0.0 0.0 571.2 571.2
Acquisition Senior Debt 1 -
Term Loan......................... 0.0 0.0 500.0 500.0
Existing Convertible Sub. Debt
Sloop............................. 310.0 0.0 0.0 310.0
Total Long Term Debt ............... 501.9 73.3 805.9 1,381.2
--------- ------- ------- ---------
Total Liabilities .................. 843.3 188.5 766.9 1,798.7
Common Equity ...................... 243.0 556.4 (556.4) 243.0
--------- ------- ------- ---------
Total Liabilities and Equity ....... $ 1,086.3 $ 744.9 $ 210.5 $ 2,041.7
========= ======= ======= =========
<PAGE>
- ---------------------------------------------------------------------------
Exhibits
- ---------------------------------------------------------------------------
<PAGE>
- ---------------------------------------------------------------------------
Comparable Companies Analysis
- ---------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Comparable Companies Analysis
(Dollars in millions, except per share amounts;
based on data from continuing operations)
Most
Recent Price Market LTM
Financials Ticker 12/9/97 Value Revenues
---------- ------ ------- ------- --------
Blount International, Inc.(4) 9/30/97 BLT A $26.44 $978.9 $686.7
Cooper Industries, Inc. 9/30/97 CBE 50.56 6.121.6 5,333.2
Cincinnati Milacron Inc. 9/30/97 CMZ 26.69 1,075.9 1,854.l
Federal Signal Corporation(5) 9/30/97 FSS 20.69 958.1 $912.9
Kaydon Corporation(6) 9/30/97 KDN 33.69 1,146.2 315.7
Mark IV Industries, Inc 8/31/97 IV 22.63 1,449.0 2,132.0
Pentair Inc. 9/30/97 PNR 38.44 1,476.6 1,742.4
Regal-Beloit Corporation(7) 9/30/97 RBC 28.00 583.0 553.9
Teleflex Inc 9/30/97 TFX 38.63 1,438.6 1.074.6
LTM N.I. Proj. Total P/E(l)
EBIT 5-Year Debt/ --------------
Margin CAGR (I) Cap.(2) 1997(E) 1998(E)
------- -------- ------- ------- -------
Blount International, Inc.(4) 13.7% 12.7% 22.2% 17.5x 14.9x
Cooper Industries, Inc. 12.4% 11.2% 33.9% 16.0 14.4
Cincinnati Milacron Inc. 6.7% 11.1% 45.8% 13.4 11.8
Federal Signal Corporation(5) 11.5% 14.8% 49.1% 16.0 14.1
Kaydon Corporation(6) 28.7% 12.0% 0.0% 18.4 16.4
Mark IV Industries, Inc 10.9% 15.0% 53.0% 13.2 11.6
Pentair Inc. 9.2% 14.0% 45.4% 18.8 16.3
Regal-Beloit Corporation(7) 14.3% 32.6% 53.4% 15.5 13.1
Teleflex Inc 10.6% 15.0% 37.1% 21.5 18.3
Adjusted Market Value
-------------------------------------
Adjusted LTM 1998(E)
Market --------------------- --------------
Value (3) Sales EBITDA EBIT EBITDA EBIT
---------- ----- ------ ---- ------ ----
Blount International, Inc.(4) $1,029.6 1.5x 8.7x 10.9x 6.9x 8.6x
Cooper Industries, Inc. 7,400.5 1.4 8.4 11.2 7.0 9.1
Cincinnati Milacron Inc. 1,434.3 0.8 8.1 11.5 6.6 9.6
Federal Signal Corporation(5) 1,222.8 1.3 9.8 11.7 9.3 10.9
Kaydon Corporation(6) 1,069.8 3.4 10.4 11.8 9.3 10.4
Mark IV Industries, Inc 2,181.3 1.0 7.2 9.4 6.6 8.6
Pentair Inc. 2,014.4 1.2 8.9 12.5 7.3 10.3
Regal-Beloit Corporation(7) 787.0 1.4 8.2 9.9 6.8 8.5
Teleflex Inc 1,671.0 1.6 10.5 14.7 8.9 12.4
LTM N.I. Proj. Total P/E(l)
Market LTM EBIT 5-Year Debt/ --------------
Value Revenues Margin CAGR (I) Cap.(2) 1997(E) 1998(E)
------- -------- ------- -------- ------- ------- -------
Mean $1,692.0 $1,622.8 13.1% 15.4% 37.75% 16.7x 14.5x
Median 1,146.2 1,074.6 11.5% 14.0% 45.45% 16.0 14.4
High 6,121.6 5,333.2 28.7% 32.6% 53.36% 21.5 18.3
Low 583.0 315.7 6.7% 11.1% 0.00% 13.2 11.6
Adjusted Market Value/
-------------------------------------
Adjusted LTM 1998(E)
Market -------------------- --------------
Value (3) Sales EBITDA EBIT EBITDA EBIT
---------- ----- ------ ---- ------ ----
Mean $2,142.5 1.5x 8.9x 11.5x 7.6x 9.8x
Median 1,328.6 1.4 8.7 11.5 7.0 9.6
High 7,400.5 3.4 10.5 14.7 9.3 12.4
Low 787.0 0.8 7.2 9.4 6.6 8.5
Most LTM N.I. Proj.
Recent Price Market LTM EBIT 5-Year
Financials Ticker 12/9/97 Value Revenues Margin CAGR (I)
---------- ------ ------- ------- -------- ------- --------
Schooner 9/30/97 $30.88 $1,282.7 $658.4 17.20% 16.0%
Adjusted Market Value/
---------------------------------
Total P/E(l) Adjusted LTM 1998(E)
Debt/ -------------- Market ----------------- ----------------
Cap.(2) 1997(E) 1998(E) Value (3) Sales EBITDA EBIT EBITDA EBIT
------- ------- ------- ---------- ----- ------ ---- ------ ----
Schooner 11.68% 17.5x 16.1x $1,228.4 1.9x 8.9x 10.8x 8.3x 10.2x
Most LTM N.I. Proj.
Recent Price Market LTM EBIT 5-Year
Financials Ticker 12/9/97 Value Revenues Margin CAGR (I)
---------- ------ ------- ------- -------- ------- --------
Sloop 9/30/97 $17.44 $840.2 $960.0 10.70% 11.6%
Adjusted Market Value/
---------------------------------
Total P/E(l) Adjusted LTM 1998(E)
Debt/ -------------- Market ----------------- ----------------
Cap.(2) 1997(E) 1998(E) Value (3) Sales EBITDA EBIT EBITDA EBIT
------- ------- ------- ---------- ----- ------ ---- ------ ----
Sloop 72.37% 11.0x 9.1x $1,341.7 1.4x 9.1x 13.1x 7.9x 10.1x
P/E(l)
--------------
1997(E) 1998(E)
------- -------
S&P 400 25.5x 23.3x
- -----------------------
NOTES:
(1) Source: l/B/E/S earnings report.
(2) Capitalization defined as shareholders' equity plus total debt.
(3) Adjusted market value is defined as market value of common equity plus
net debt (total debt less cash), book value of preferred stock and
minority interest.
(4) Reflects 2-for-l stock split on 12/8/97. Post-split, approximately
37.4 million shares outstanding.
(5) Provides leasing services which result in $172.2 million and $149.5
million in financing related assets and liabilities, respectively,
representing 23.3% and 33.6% of tofal assets and liabilities,
repectively.
(6) D&A not available on a quarterly basis; D&A for LTM calculations
assumed to be the same as for the fiscal year ended 12/31/96. Not pro
forma for the recent acquisitions of several fluid power companies.
(7) Pro forma for the recent acquisition of Marathon Electric derived by
annualizing the 6 months ended 6/30/97 period.
<PAGE>
- --------------------------------------------------------------------------------
Precedent Transactions Analysis
- --------------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Precedent Transactions Analysis
(Dollars in millions)
<TABLE>
<CAPTION>
Multiples of
----------------------------------------------------
Transaction Value/ Equity Value/ Transaction Value/
------------------- ------------- ------------------
Trans- LTM Tang. FTM FTM
Date of Purchase action EBIT Reven- LTM LTM LTM Net Book EBIT EBITDA Target's
Ann. Target Acquiror Price (a) Value(b) Margin ues EBIT EBITDA Income Value (c) (c) Business Description
- -------- ----------- ---------- ---------- -------- ------ ----- ----- ------ ------- ----- ----- ----- --------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
10/10/97 Greenfield Kennametal, 623.5 942.8 11.5% 1.8 15.6x 11.6x 24.5x 20.1x 12.5x 9.8x Manufactures cutting
Industries Inc. tools and related
products that are
consumed during
industrial applications.
The Company also
manufactures small
diameter drills, routers
for manufacturing
circuit boards and
carbide products for the
petroleum industry.
08/28/97 Versa Applied 141.9 140.7 11.5% 1.5 12.8 9.5 21.2 4.0 NA NA Versa Technologies is
Tech- Power, comprised of three
nologies, Inc. operating segments: the
Inc. custom components
segment, the medical
segment and the fluid
power segment, the
largest segment which
produces hydraulic and
pneumatic cylinders.
06/26/97 Imo Constell- 120.8 415.8 5.4% 0.9 16.3 9.1 NM NM 11.1 7.2 Diversified industrial
Industries ation manufacture of power
Inc. Capital transmission equipment,
Partners pumps, fluid sensors,
LLC motion control products,
remote control systems
and automotive
components.
06/16/97 Core United 249.0 298.5 10.7% 1.2 11.5 9.3 17.4 2.3 NA NA Manufactures power
Industries Dominion supplies computer
Inc. Industries components,
Ltd. pipeline valves,
steel doors,
hydraulic wagons,
molded plastics and
metal stampings and
hinges for the
electronic, fluid
control, construction.
farm equipment and
industrial markets.
06/16/97 The Raymond BT 353.0 440.0 11.0% 1.3 12.1 10.0 22.4 2.1 10.5 8.9 A leading manufacturer
Corporation Industries of electric narrow aisle
AB forklifts and related
material-handling
systems and equipment
for rise in warehouses,
distribution centers
and manufacturing
environments.
06/12/97 Giddings Thyssen AG 675.0 705.0 7.3% 1.0 13.4 9.6 24.4 2.6 12.5 9.2 A leading global
& Lewis, manufacturer of highly
Inc. engineered industrial
automation systems,
including automated
machine tools, smart
manufacturing systems,
flexible transfer lines,
assembly automation
systems, measuring
systems and industrial
controls.
05/06/97 BW/IPlnc. Durco 435.5 534.1 10.5% 1.1 10.5 NA 15.8 3.3 9.4 NA Worldwide supplier of
International advanced technology
fluid transfer and
control equipment,
systems and services.
Its principal products
are pumps, mechanical
seals and valves for
the petroleum, chemical
and marine industries.
</TABLE>
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Precedent Transactions Analysis
(Dollars in millions)
<TABLE>
<CAPTION>
Multiples of
----------------------------------------------------
Transaction Value/ Equity Value/ Transaction Value/
------------------- ------------- ------------------
Trans- LTM Tang. FTM FTM
Date of Purchase action EBIT Reven- LTM LTM LTM Net Book EBIT EBITDA Target's
Ann. Target Acquiror Price (a) Value(b) Margin ues EBIT EBITDA Income Value (c) (c) Business Description
- -------- ----------- ---------- ---------- -------- ------ ----- ----- ------ ------- ----- ----- ----- --------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
04/21/97 Goulds ITT 815.0 938.7 8.3% 1.2 14.6 10.0 23.5 4.4 13.1 9.3 Designs, manufactures,
Pumps, Inc. Indust- sells and repairs
tries, centrifugal pumps and
Inc. accessories for a broad
range of applications
including: residential,
chemical, commercial,
pulp and paper, general
industry, sewage and
drainage oil refining.
04/09/97 Stant Tompkins 406.0 606.0 8.6% 0.9 10.7 7.2 19.0 11.1 9.6 6.7 Manufacturers automotive
Corporation Plc windshield wiping
systems and windshield
wiper blades and
refills; closure caps
and engine thermostats;
and a leading
manufacturer of other
automotive products
including hose clamps,
heaters, grease guns and
auto tools.
03/20/97 Falcon Investcorp 365.0 590.0 9.4% 0.9 9.9 7.8 12.2 NM 9.6 7.7 Leading domestic
Building manufacturer of products
Products, for the residential and
Inc. commercial construction
and home-improvement
markets. Products
include: plumbing
fixtures, air
compressors, electric
generators, power
washers and OEM
compressors.
02/26/97 Marathon Regal- 278.0 248.3 11.1% 1.0 9.1 7.2 15.6 2.4 NA NA Leading manufacturer of
Electronic Beloit electric motors,
Manufactur- Corpora- generators and related
ing Cor- tion products for the pulp,
poration paper and petrochemicals,
fluid handling, fans and
blowers, and the HVAC
aftermarket.
07/01/96 NEWFLO Precision 176.0 300.0 14.0% 1.3 9.5 7.6 23.8 NM NA NA Manufacturer of
Corp. Castparts high-quality, niche
oriented industrial fluid
management products,
which include fluid
handling industrial
pumps, industrial valves
and fluid measurement
instruments.
06/14/96 Brenco, Varlen 169.0 165.1 12.0% 1.3 11.0 8.4 17.1 2.6 10.4 8.1 Manufactures roller
Inc. Corp. bearings and component
parts for major
railroads, car builders
and automobile
manufacturers in the
U.S., Canada, India and
Mexico.
04/01/96 Teledyne Alle- 2,247.1 2,545.9 8.9% 1.0 10.9 8.4 17.6 5.2 9.8 7.7 Manufactures aviation and
Inc. gheny electronic equipment,
Ludlum specialty metals,
Corp. industrial equipment and
consumer expendables.
</TABLE>
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Precedent Transactions Analysis
(Dollars in millions)
<TABLE>
<CAPTION>
Multiples of
----------------------------------------------------
Transaction Value/ Equity Value/ Transaction Value/
------------------- ------------- ------------------
Trans- LTM Tang. FTM FTM
Date of Purchase action EBIT Reven- LTM LTM LTM Net Book EBIT EBITDA Target's
Ann. Target Acquiror Price (a) Value(b) Margin ues EBIT EBITDA Income Value (c) (c) Business Description
- -------- ----------- ---------- ---------- -------- ------ ----- ----- ------ ------- ----- ----- ----- --------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
03/07/96 Acme- Danaher 173.0 126.9 10.4% 1.0 9.6 7.2 19.8 2.1 8.0 6.3 Manufactures products in
Cleveland Corp. two business segments:
Corp. telecommunications and
electronic products, and
precision parts.
01/22/96 Premier Farnell 2,794.9 2,792.8 20.2% 3.3 16.3 15.4 24.8 6.0 14.5 13.8 Manufactures and
Industrial Electronics distributes a wide range
Corp. plc of products to repair
and maintain equipment,
machinery, vehicles and
buildings; a leading
distributor of
electronic components.
09/12/95 Elco Textron 179.4 216.7 7.7% 0.9 11.4 7.1 17.5 2.8 NA NA Manufacturer of
specialty metal
Industries Inc. fasteners and
Inc. application-specific
components and
assemblies.
10/03/94 Purolater Mark IV 277.4 315.9 4.8% 0.7 14.2 8.8 12.7 4.0 NA NA Manufactures oil, fuel,
Products Industries, and air filters, fuel
Co. Inc. pumps, clutches, motor
vehicle brake systems
and parts.
</TABLE>
Multiples of
----------------------------------------------------
Transaction Value/ Equity Value/ Transaction Value/
---------------------- ------------- ------------------
LTM Tang. FTM FTM
EBIT Reven- LTM LTM LTM Net Book EBIT EBITDA
Margin ues EBIT EBITDA Income Value (c) (c)
------ ----- ----- ------ ------- ----- ----- ------
Mean...... 10.2% 1.2x 12.2x 9.1x 19.4x 5.0x 10.9x 8.6x
Median.... 10.5% 1.1 11.5 8.8 19.0 3.3 10.5 8.1
High...... 20.2% 3.3 16.3 15.4 24.8 20.1 14.5 13.8
Low....... 4.8% 0.7 9.1 7.1 12.2 2.1 8.0 6.3
- -------------------
NOTES:
(a) Purchase price equals total shares outstanding (adjusted for warrants,
options and other convertible securities) multiplied by purchase price per
share.
(b) Transaction value equals purchase price plus total debt less cash and cash
equivalents.
(c) FTM (forward twelve months) financials based on analyst earnings estimates
for target at the time of transaction adjusted for taxes at 38%, and
interest, depreciation and amortization expenses based on LTM results.
<PAGE>
- --------------------------------------------------------------------------------
Discounted Cash Flow Analysis
- --------------------------------------------------------------------------------
<PAGE>
Confidential Project Yacht
- --------------------------------------------------------------------------------
Discounted Cash Flow Analysis
(Dollars in Millions, Except Per Share Data)
Projected (1)
-------------------------------------------------
Schooner Income Statement 1998 1999 2000 2001 2002
-------- -------- -------- -------- --------
EBITDA ................... $ 157.0 $ 171.4 $ 193.1 $ 212.8 $ 232.7
Less: Depreciation &
Amortization...... 28.8 31.7 34.6 37.2 39.6
-------- -------- -------- -------- --------
EBIT ..................... $ 128.3 $ 139.7 $ 158.5 $ 175.6 $ 193.1
Free Cash Flow Calculation
EBIT ..................... $ 128.3 $ 139.7 $ 158.5 $ 175.6 $ 193.1
Less: Tax @ 37.0% ...... (47.5) (51.7) (58.6) (65.0) (71.5)
Plus: Depreciation &
Amortization...... 28.8 31.7 34.6 37.2 39.6
Less: Capex ........... (37.2) (37.8) (35.1) (30.0) (30.1)
Less: Increase in
Working Capital.. (4.2) (1.9) (8.3) (6.1) (5.2)
-------- -------- -------- -------- --------
Free Cash Flow ........... $ 68.1 $ 80.1 $ 91.1 $ 111.7 $ 125.9
PV of Interim Cash Flow PV of Terminal Value
---------------------------------- ---------------------------------
Discount Rate PV of Cash Flow Multiple of 2002 EBITDA of:
------------- --------------- ---------------------------------
11.0% $341.3 8.0x 9.0x 10.0x
12.0% 331.9 -------- -------- --------
13.0% 323.0 $1,104.8 $1,242.9 $1,381.0
1,056.4 1,188.4 1,320.5
1,010.5 1,136.8 1,263.1
Total Enterprise Value Equity Value Per Share
--------------------------------- ---------------------------------
Multiple of 2002 EBITDA of: Multiple of 2002 EBITDA of:
--------------------------------- ---------------------------------
8.0x 9.0x 10.0x 8.0x 9.0x 10.0x
-------- -------- --------- ------ ------ ------
$1,446.1 $1,584.2 $1,722.3 $36.34 $39.66 $42.97
1,388.3 1,520.3 1,652.4 34.96 38.12 41.29
1,333.4 1,459.7 1,586.0 33.64 36.67 39.70
(1) Source: Based on Schooner management estimates
