Romi Targets Hardinge with $92-Million Offer

Machine tool builder shows no interest in being acquired

Industrias Romi S.A. has made an unsolicited, $92-million takeover bid for rival machine-tool builder Hardinge Inc. The $8/share, all-cash offer for all outstanding Hardinge shares was first proposed in late November, and then in a formal bid presented to Hardinge directors in mid December. But, according to Romi, Hardinge “has refused to enter into any meaningful dialogue to explore the merits and potential terms of a transaction.”

Romi, a Brazilian company, manufactures machine tools, plastic injection, and blow molding machines. It also produces component parts made of gray and ductile iron.

Hardinge, of Elmira, NY, produces vertical and horizontal machining centers, CNC lathes, grinding tools, and workholding equipment. Its brands include the Hardinge, Kellenberger, Bridgeport, Hauser, and Tschudin product lines.

"Our all-cash offer provides immediate liquidity at a superior value to Hardinge's future prospects as a stand-alone company,” stated Romi CEO Livaldo Aguiar dos Santos. “In addition to delivering a significant premium to Hardinge shareholders, Romi believes the combination is in the best interests of Hardinge's employees, customers and partners.”

UPDATE, 02/08/2010: Following Romi’s publication of the offer, Hardinge confirmed it has received the unsolicited proposal and noted that its directors and financial and legal advisers are evaluating it before responding. Hardinge also urged its shareholders to take no action until the board has made a determination of the offer’s value.

Aguiar dos Santos explained that Romi is interested in expanding its global activities, and Hardinge's market presence in China and Taiwan make it an attractive addition to its organization. He added that combining the groups would establish the size and scale necessary for manufacturing technology companies to invest in strategic opportunities, and would allow both organizations to compete globally.

Aguiar dos Santos emphasized that Romi intends to maintain the Hardinge manufacturing operation in Elmira and elsewhere in the U.S.

"We have great respect for Hardinge and together we can create a strong, diversified global platform for the machine tools business with considerable opportunities for further growth and innovation," he said.

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