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EXHIBIT 99.1
FOR IMMEDIATE RELEASE Contacts: Jill Burchill
Chief Financial Officer
November 10, 2000 507/663-8294
Sheldahl, Inc. [email protected]
1150 Sheldahl Road
Northfield, MN 55057 Jennifer Weichert for Sheldahl
Weichert Financial Relations, Inc.
651/261-5330
[email protected]
Troy McCombs for IFT
Coltrin and Associates
212/221-1616
Troy_McCombs@Coltrin Com
SHELDAHL SIGNS DEFINITIVE MERGER AGREEMENT WITH INTERNATIONAL FLEX TECHNOLOGIES
New Equity Infusion Will Provide Opportunity for Company Growth
Northfield, MN, -- November 10, 2000 -- Sheldahl Inc. (NasdaqNM: SHEL) and
International Flex Technologies Inc. announced today that they have entered into
a definitive Merger Agreement under which Sheldahl will acquire International
Flex Technologies ("IFT") for approximately 7.6 million shares of common stock.
Concurrent with the closing of the acquisition, Morgenthaler Partners
("Morgenthaler"), IFT's majority shareholder, and Ampersand Ventures
("Ampersand") will invest $25.0 million in equity capital in exchange for
approximately 4.9 million shares of Sheldahl common stock and shares of a new
series of Sheldahl preferred stock that is convertible into approximately 4.1
million shares of Sheldahl common stock. In addition, Molex Inc. ("Molex"), a
Sheldahl customer and joint venture partner, has agreed to join with
Morgenthaler and Ampersand in committing to purchase up to an aggregate of $15.0
million of Sheldahl subordinated debt and warrants. If Sheldahl issues the full
$15.0 million of notes, it will issue warrants to the note holders to purchase
approximately 2.3 million shares of Sheldahl common stock.
As a result of these transactions, Morgenthaler, other IFT stockholders and
Ampersand will collectively hold securities representing ownership of
approximately 49% of Sheldahl on a fully diluted basis (assuming conversion of
all Sheldahl convertible securities). In addition, Molex will increase its
ownership of Sheldahl securities and, after participation in these transactions,
will own approximately 10% of Sheldahl on a fully diluted basis.
"We are pleased that Molex, Sheldahl's largest shareholder, has decided to
participate in this transaction," said John Lutsi, general partner at
Morgenthaler.
-more-
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SHELDAHL SIGNS DEFINITIVE
MERGER AGREEMENT
WITH INTERNATIONAL FLEX TECHNOLOGIES
Page Two.
Upon completion of the merger, the combined company will operate under the
Sheldahl name as a publicly traded concern, with IFT operating as a wholly owned
subsidiary of Sheldahl. The new Board of Directors will include three of the
current directors of Sheldahl, three designees of Morgenthaler, Ampersand and
IFT and one representative from Molex.
"We are delighted that Sheldahl and IFT are joining forces. This new company
will combine the mature product lines of Sheldahl's core business, the newer
packaging products of IFT, Sheldahl's Micro Products and Sheldahl's emerging
products in plastic displays and wireless communication devices," said Sheldahl
President Edward L. Lundstrom. "In particular, we have preserved the upside
potential from chip packaging and other new products for our shareholders. Our
employees and shareholders will also benefit from IFT's highly competent
organization with proven talent, technology and operating strength."
"The improved liquidity afforded by our investment partners clearly paves the
road for us to finish the development and commercialization of our new products
while we simultaneously grow the core business and improve profitability,"
Lundstrom continued. "Sheldahl's Board and I fully support these transactions.
We believe this is in our shareholders' best interests and provides for exciting
opportunities for growth and advancement for our employees."
"The combined company will be a major force in the marketplace, offering
world-class technology," said Donald R. Friedman, President and Chief Executive
Officer of IFT. "Further, we can better provide for all of our customers with
the expanded capacities that Longmont offers, which clearly compliments our
Endicott location. We believe that customers, shareholders and employees of IFT
and Sheldahl will benefit from this combination."
The transactions are subject to a number of customary closing conditions,
including regulatory approvals, as well as compliance with Nasdaq regulations
that require either shareholder approval or advance notice to shareholders.
International Flex Technologies Inc. is a leading producer of fine-line, high
quality flexible circuits for sale to the electronics, data communications and
medical markets. The Company, headquartered in Endicott, New York, has
operations in Stamford, Connecticut and sales offices worldwide. Information on
IFT can be found on the World Wide Web at http://www.internationalflex.com.
-more-
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SHELDAHL SIGNS DEFINITIVE
MERGER AGREEMENT
WITH INTERNATIONAL FLEX TECHNOLOGIES
Page Three.
Morgenthaler Partners is a private equity investment firm with offices in
Cleveland, Ohio and Menlo Park, California, with approximately $1.0 billion
under management. Information on Morganthaler can be found on the World Wide Web
at http://www.morganthaler.com.
Ampersand Ventures is a private equity investment firm with offices in
Wellesley, Massachusetts and San Diego, California, with approximately $350
million in capital under management.
Molex Incorporated is a 62-year-old manufacturer of electronic, electrical and
fiber optic interconnection products and systems; switches; value-added
assemblies; and application tooling. Based in Lisle, Illinois, USA, the Company
operates 52 manufacturing facilities in 19 countries and employs approximately
17,650 people. For more information please go to http://www.molex.com.
Sheldahl, Inc. is a leading producer of high-density substrates, high-quality
flexible printed circuitry, and flexible laminates primarily for sale to the
automotive electronics and data communications markets. The Company, which is
headquartered in Northfield, Minnesota, has operations in Northfield; Longmont,
Colorado; South Dakota; Toronto, Ontario, Canada; and Chihuahua, Chih., Mexico.
Its sales offices are located in Detroit, Michigan, Hong Kong, China; Singapore;
and Mainz, Germany. As of September 1, 2000, Sheldahl employed approximately 800
people. Sheldahl's common stock trades on the Nasdaq National Market tier of the
Nasdaq Stock Market under the symbol: SHEL. Sheldahl news and information can be
found on the World Wide Web at http://www.sheldahl.com.
The discussion above contains statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements by their nature
involve substantial risks and uncertainties as described by Sheldahl's periodic
filings. Actual results may differ materially depending on a variety of factors,
including, but not limited to the following: the achievement of Sheldahl's
projected operating results, the ability of Sheldahl to successfully obtain
waivers from its lenders for defaults on its debt covenants, the achievement of
efficient volume production and related sales revenue results at Longmont, the
ability of Sheldahl to identify and successfully pursue other business
opportunities and Sheldahl not completing the transaction as described above.
Additional information with respect to the risks and uncertainties faced by
Sheldahl may be found in, and the prior discussion is qualified in its entirety
by, the Risk Factors contained in the Company's filings with the Securities and
Exchange Commission including Sheldahl's Annual Report, Form 10-K for the fiscal
year ended August 27, 1999, Forms 10-Q for the quarters ending November26, 1999,
February 25, 2000 and May 26, 2000, and other SEC filings. Sheldahl does not
undertake any obligation to update any such factors or to publicly announce
developments or events relating to the matters described herein.
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