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2/19/2003



Rail News: Rail Industry Trends

Timken completes Torrington transaction


On Feb. 18, The Timken Co. completed its acquisition of The Torrington Co. from Ingersoll-Rand Co. Ltd. for $700 million cash and Timken shares worth $140 million.


With 2002 sales of $1.2 billion, Torrington makes Timken the world's third-largest bearing producer with about $3.8 billion in sales, and expands Timken's portfolio of automotive and industrial bearings-based products and services, according to a prepared statement. Torrington produces ball, needle-roller, spherical and cylindrical bearings, and motion-control components and assemblies.


"With this acquisition, we are increasing the size of our company by almost 50 percent," said Timken Chairman W. R. Timken Jr. in a prepared statement. "And, we are continuing to concentrate on what we do best by buying a company in an industry where we have a leadership position built on decades of expertise."


Timken plans to quickly integrate Torrington to obtain $20 million in pretax savings a year after the acquisition and $80 million by the end of 2005. Savings would be achieved by consolidating purchases and distribution channels, combining operations and eliminating organizational redundancies.


Timken financed the transaction's $700 million cash component through a public offering of 12.65 million Timken shares, an offering of $250 million seven-year senior unsecured notes, a five-year revolving credit facility and a $125 million secure accounts-receivable facility.


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