Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 29, 1995
TECHNITROL, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 1-5375 23-1292472
(State or other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
1210 Northbrook Drive, Suite 385
Trevose, Pennsylvania 19053
(Address of principal executive offices)
(215) 355-2900
(Registrant's telephone number, including area code)
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Item 2. Acquisition or Disposition of Assets.
On September 29, 1995, the Registrant completed the acquisition of Pulse
Engineering, Inc. a Delaware corporation ("Pulse"), through a merger (the
"Merger") of Pulse with and into Teco Sub, Inc., a Delaware corporation and a
wholly-owned subsidiary of the Registrant, pursuant to an Agreement and Plan
of Merger, dated as of May 23, 1995, by and among the Registrant, Teco Sub and
Pulse. As a result of the Merger, Pulse became a wholly-owned subsidiary of
the Registrant. The Merger was effected by the filing of a Certificate of
Merger with the Delaware Secretary of State on September 29, 1995.
The Registrant manufactures electrical contacts and assemblies,
thermostatic and clad-metal products, mechanical scales and force measurement
products, material testing systems, cash counters and dispensers, and
electronic components. Pulse designs, manufactures and markets electronic
components and modules primarily for original equipment manufacturers of local
area networks, digital telecommunications equipment and data processing
equipment.
The consideration provided by the Registrant in connection with the
Merger consisted of shares of its Common Stock and cash. The Registrant issued
1,785,148 shares of its Common Stock to former holders of Pulse Common Stock.
In addition, Registrant paid to former Pulse shareholders $21,536,067 in cash.
All outstanding options to purchase Pulse Common Stock were also assumed by
the Registrant. Approximately 253,306 shares of the Registrant's Common Stock
are issuable upon exercise of such options.
Registrant has spent or will spend approximately $23.1 million (including
$16.1 million of cash on hand and $7 million provided from Registrant's credit
facility with Corestates Bank, N.A. as Agent, Midlantic Bank, N.A. and
Meridian Bank) to fund the cash portion of the merger consideration and
related transaction expenses.
The merger consideration was determined pursuant to arms' length
negotiations of the terms of the Merger and took into account various factors,
including the relative earnings and prospects of the Registrant and Pulse, as
well as synergies and cost savings anticipated to be realized from the
combination of their operations.
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
(a) Financial statements of business acquired. Incorporated by
reference to pages F-25 through F-36 of the Prospectus in the Registrant's
Registration Statement on Form S-4 (No. 33-61965).
(b) Pro forma financial information. Incorporated by reference to
pages 27-32 of the Prospectus in the Registrant's Registration Statement on
Form S-4 (No. 33- 61965).
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(c) Exhibits.
2.1 Agreement and Plan of Merger among the Registrant, Teco
Sub and Pulse (incorporated by reference to the Registrant's Registration
Statement on Form S-4 (No. 33-61965)).
20.1 Press release dated October 2, 1995.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: October 5, 1995
TECHNITROL, INC.
By: /s/ Thomas J. Flakoll
---------------------------
Thomas J. Flakoll
Chief Executive Officer
EXHIBIT 20.1
Philadelphia, PA, October 2, 1995 - Technitrol, Inc. [AMEX:TNL] announced
that it has completed its acquisition of Pulse Engineering, Inc. and Pulse is
now a wholly-owned subsidiary of Technitrol. Pulse will remain headquartered
in San Diego, CA.
The exchange ratio, based on a $16.5125 average price of Technitrol
Common Stock during the measurement period proceeding the merger, was .5765
shares of Technitrol for each share of Pulse Common Stock. This would result
in the issuance of 1,618,686 shares of Technitrol Common Stock (assuming that
50% of the merger consideration is paid in Technitrol Common Stock) and
1,780,555 shares of Technitrol Common Stock (assuming that 55% of the merger
consideration is paid in Technitrol Common Stock). While election forms have
not yet been fully tabulated, early indications are that a significant
majority of Pulse stockholders have elected to receive Technitrol Common
Stock. The Merger Agreement caps the shares of Technitrol Common Stock to be
issued as merger consideration at 55% of the total consideration paid.
Technitrol expects that this limit will be reached.
In conjunction with the Pulse merger, Technitrol also closed on a credit
facility with a group of banks (Corestates Bank, N.A., as Agent, Midlantic
Bank, N.A. and Meridian Bank, N.A.) which authorizes Technitrol to borrow up
to $50 million on an unsecured basis. Technitrol has used approximately $18
million of this credit facility to refinance existing indebtedness and
approximately $4 million of the credit facility (together with approximately
$18 million of cash on hand) to fund the anticipated cash portion of the
merger consideration. Technitrol anticipates borrowing under the credit
facility to finance related transaction expenses bringing total anticipated
borrowings to approximately $28 million. Technitrol expects that this credit
facility together with the internally generated cash will be sufficient to
meet anticipated cash needs in the foreseeable future.
Roy Hock, Chairman of Technitrol, said that "the completion of the Pulse
merger is a very important milestone for our Electronics Segment which will
now be producing electronic components in the United States, the People's
Republic of China, The Republic of Ireland, Taiwan and the Philippines, making
us fully competitive with anyone else in the world in this business. We look
forward to the challenges presented by this opportunity and welcome the
thousands of dedicated Pulse employees throughout the world to the Technitrol
family of companies."
Technitrol also announced a series of related senior management
realignments.
Roy E. Hock, now Chief Executive Officer, will remain Chairman of the
Board.
Thomas J. Flakoll, currently President, will assume the duties and title
of Chief Executive Officer.
James M. Papada, III, a Director, will become Vice Chairman of the Board.
John L. Kowalski, General Manager of the Technitrol Components Division,
has been elected Vice President of Technitrol and also will become President
of Pulse and will be responsible for the day-to-day operations of the
Electronics Segment worldwide.
Mr. Hock said "these management changes, together with those announced
last May, are in keeping with the opportunities presented by the Pulse
acquisition and are designed to position Senior Management of Technitrol and
the Electronics Segment to move with our operations into the 21st century.
The creation of the separate position of Chairman evidences the evolving
importance of the role to be played by the Board of Directors in the Company
as it grows larger and more complex, and reflects the desire of the Board to
continue to fully exercise its oversight role. We believe these changes
reflect evolving contemporary trends in corporate governance and represent the
very best the Board and the Company can do for our traditional Technitrol
shareholders and those Pulse shareholders who have put their trust in us by
overwhelmingly electing to receive Technitrol Common Stock in the Pulse
merger."
The Company's stock (TNL) is traded on the American Stock Exchange. For
further information, call Albert Thorp, Vice President, Finance -
(215) 355-2900.
