Romi Raises Bid for Hardinge by 25%

May 12, 2010
$10/share is called the final bid in proposed merger of machine tool builders

More than six months since launching its takeover bid for Hardinge Inc., Industrias Romi S.A. has raised its bid to acquire the rival’s outstanding shares to $10.00 per share. With an estimated value of $115 million, the new offer is final, Romi said.

Hardinge issued a statement acknowledging the offer but urged shareholders to take no action. It said it would respond within 10 days.

A cash tender offer at $8.00 per share was issued in late March, and due to expire May 10. The closing has been extended to May 26, and Romi stated almost 4,500 shares had been tendered as of May 7.

"Hardinge's first quarter 2010 earnings were consistent with our expectations and reinforce our view of the company's future prospects and our outlook for the industry," stated Romi CEO Livaldo Aguiar dos Santos. "Although we remain a disciplined bidder, in raising our offer we have taken into account the views of Hardinge's shareholders and our goal of completing a transaction that makes strategic sense for both companies as soon as possible.”

Romi initiated the takeover effort in October 2009 with an approach to the Hardinge board, but all attempts at negotiating a merger have been rejected. The Brazilian company has consistently argued that combining its assets with those of Hardinge will form an organization that is more suited to compete in the global machine tool market.

Romi manufactures machine tools, plastic injection, and blow molding machines, and 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.

“We believe $10.00 per share is the most attractive strategic alternative available to Hardinge's board and its shareholders, including continuing as a standalone company,” dos Santos said. “We hope the members of the Hardinge board will listen to their shareholders and begin discussions with us immediately to negotiate a definitive merger agreement."

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