Directors of machine tool builder Hardinge Inc. voted unanimously to recommend that shareholders reject the $92-million cash tender offer from Industrias Romi S.A. The offer is in effect through May 10. It was made March 30 after several months of unsuccessful efforts by Romi to reach an agreement on its proposed acquisition of Hardinge.
Kyle H. Seymour, non-executive chairman of the board, said the directors’ unanimous position is that the offer is “an opportunistic attempt by Romi to acquire Hardinge at a grossly inadequate price that fails to reflect the value of our significant industry position, global market presence, and future growth prospects. The Hardinge board strongly urges shareholders to reject Romi's offer and not tender their shares."
Brazil-based 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.
Hardinge directors reminded shareholders that the board rejected a similar proposal from Romi in February, and it filed a statement with the Securities and Exchange Commission detailing its reasons for rejecting the offer. In it, they detailed their conclusion that the proposal is “grossly inadequate,” “opportunistic,” “highly conditional,” and “coercive.”
In a further point, the board explained to shareholders that their response to Romi is based in part on their confidence that Hardinge is well-positioned to emerge from the current economic downturn and to benefit as the machine tool industry recovers.
Hardinge president and CEO Richard L. Simons, stated: "Over the past year, we have made substantial progress positioning Hardinge for significantly improved performance, including taking steps that have generated annual fixed cost savings of approximately $30 million. Management and the board believe that the company is poised to reap the benefits of its streamlined operating structure and to outperform market improvements as the machine tool industry recovers."