EXHIBIT 99.1
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[Springs Logo]
Springs Industries, Inc. Contact: Xxxxx Xxxxxx
Post Office Box 70 Vice President - Public Affairs
Fort Mill, SC 29716 (000) 000-0000
Heartland Industrial Partners
Xxxxxx X. Xxxxxxxx
(000) 000-0000
FOR IMMEDIATE RELEASE April 25, 2001
SPRINGS ANNOUNCES GOING PRIVATE AGREEMENT REACHED
WITH CLOSE FAMILY AND HEARTLAND INDUSTRIAL PARTNERS
FORT MILL, SC AND GREENWICH, CT -- Springs Industries, Inc. (NYSE:SMI)
announced today that it has entered into a definitive recapitalization agreement
with Heartland Springs Investment Company, an affiliate of Heartland Industrial
Partners, L.P., a private equity firm. Upon completion of the recapitalization,
which would be accomplished through a merger between Springs and the Heartland
affiliate, each public shareholder of Springs would receive $46 per share in
cash and Springs would become privately held by the Close family, whose
ownership interest in Springs' common stock would increase from approximately
41% to approximately 55%, and Heartland, whose ownership interest in Springs'
common stock would be approximately 45%.
Upon the unanimous recommendation of a special committee of independent
directors who negotiated the transaction on behalf of Springs' public
shareholders, the board of directors of Springs has approved the
recapitalization agreement. The special committee was advised by UBS Warburg LLC
as financial advisor and Xxxxxxxx & Xxxxxxxx as legal counsel. The Close family
and Heartland submitted their original $44 per share proposal on February 20,
2001. The Close Family and Heartland were advised by Xxxxxx X. Xxx, managing
member of CRT, LLC, a Connecticut-based investment banking firm.
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In a joint statement Xxxxx Xxxxxxxx, senior managing director of
Heartland, and Xxxxxxxx X. Xxxxxx, Springs chairman and chief executive officer
and a Close family member, said "We are pleased with the unanimous
recommendation of the special committee of independent directors and the full
board's approval authorizing the transaction at a price of $46 per share. We
look forward to the transaction being finalized this summer."
The transaction will require the approval of two-thirds of the outstanding
Class A and Class B shares of Springs, with each share casting one vote per
share. In addition, approval must be obtained from holders of a majority of the
shares voted that are not affiliated with either the Close family or Heartland.
Springs expects to hold the shareholders meeting to vote on the transaction by
late July or early August.
The completion of the proposed recapitalization is subject to certain
other conditions, including regulatory approvals, the availability of funding
and other customary closing conditions. Members of the Close family have agreed
that they will retain substantially all of their shares and will vote against
any competing proposal to acquire Springs.
The value of the recapitalization transaction, including the assumption of
debt, is estimated to exceed $1.2 billion. The transaction will be funded by a
$225 million equity commitment from Heartland and a debt commitment from X.X.
Xxxxxx Xxxxx & Co. providing the balance of the financing necessary to complete
the proposed recapitalization. The debt commitments are subject to customary
closing conditions. X.X. Xxxxxx Xxxxx & Co. also advised Heartland on the
transaction. Heartland is being joined in the transaction by other co-investors
who are limited partners in Heartland's fund.
Heartland Industrial Partners, L.P. is a private equity firm established
to "buy, build and grow" industrial companies in sectors ripe for consolidation
and long-term growth. Since its founding in 1999, the firm has received equity
commitments from institutional investors in excess of $1.2 billion. Heartland
was founded by Xxxxx X. Xxxxxxxx, a former partner of The Blackstone Group and a
Xxxxxx administration cabinet officer; Xxxxxxx X. Xxxxxxxxx, the former
president and chief operating officer of Penske Corporation; and Xxxxxx X.
Xxxxxxxx, a former managing director of Chase Securities.
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Springs Industries (NYSE: Ticker Symbol SMI) supplies leading retailers
with a complete line of sheets, towels, comforters, window treatments and other
coordinated home fashions designed to simplify home decorating for every
consumer. Our major brands are Wamsutta(R), Springmaid(R), Regal(R), Xxxxxx(R),
Bali(R), Nanik(R), and Dundee(R). Springs also markets bed and bath products for
institutional and hospitality customers, home sewing fabrics, and baby bedding
and baby apparel products. The company operates facilities in 13 U.S. states and
owns marketing and distribution subsidiaries in Canada and Mexico.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
This press release contains certain "forward-looking" statements within
the meaning of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that such forward-looking statements
with respect to revenues, earnings, performance, strategies, prospects, the
consummation and benefits of future acquisitions, future sales, operating
efficiencies, product expansion and other aspects of the business of Springs are
based on current expectations that are subject to known and unknown risks,
uncertainties and contingencies, many of which are beyond the control of
Springs. A number of factors could cause actual results, performance or outcomes
to differ materially from those indicated by such forward-looking statements.
These factors include, but are not limited to, risks, uncertainties and
contingencies relating to: overall economic and business conditions, the demand
for Springs' goods and services, competitive factors in the industries in which
Springs competes, changes in government laws and regulation, availability and
cost of capital, and the timing, impact and other uncertainties of future
acquisitions. Readers are referred to Springs' most recent reports filed with
the SEC. Springs is under no obligation to (and expressly disclaims any such
obligation to) update or alter its forward-looking statements, whether as a
result of new information, future events or otherwise.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed recapitalization, Springs will be filing a
proxy statement with the Securities and Exchange Commission. INVESTORS AND
SECURITY HOLDERS OF SPRINGS ARE ADVISED TO READ THE PROXY STATEMENT WHEN IT
BECOMES AVAILABLE BECAUSE IT WILL CONTAIN
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IMPORTANT INFORMATION. Investors and security holders may obtain a free copy of
the proxy statement when it becomes available and other documents filed by
Springs with the Securities and Exchange Commission in connection with the
proposed recapitalization at the Securities and Exchange Commission's web site
at xxx.xxx.xxx. Shareholders of Springs may also obtain for free the proxy
statement and other documents filed by Springs in connection with the proposed
recapitalization by directing a request to Springs Industries, Inc., Attn:
Corporate Secretary, 000 X. Xxxxx Xxxxxx, Xxxx Xxxx, Xxxxx Xxxxxxxx 00000,
Telephone: (000) 000-0000.
CERTAIN INFORMATION CONCERNING PARTICIPANTS
Springs and certain other persons named below may be deemed to be
participants in the solicitation of proxies from Springs' stockholders.
The participants in the solicitation may include the directors of Springs:
Xxxx X. Xxxxx, Xxxxxxxx X. Xxxxxx, Xxxx X. Xxxxxxxxx, Xxxxx X. Xxxxx, Xxxxxxx X.
Xxxxx, Xxxxxxx X. Xxxxxx, Xxxx X. XxXxxxxx, Xxxx Xxxxxx, Xxxxx X. Xxxxx,
Xxxxxxxx X. Xxxxx Xx. and Xxxxxxx Xxxxxx; and the executive officers of Springs:
Xxxxxxxx X. Xxxxxx (chief executive officer), Xxxxxxx X. Xxxxxx (executive vice
president and chief financial officer), Xxxxxx X. Xxxxxxx (senior vice
president-human resources), Xxxx X. Xxxxxx (senior vice president and chief
purchasing officer), X. Xxxxxx Xxxxxxx (senior vice president, general counsel
and corporate secretary), Xxxxxxx X. Xxxxxx (senior vice president), Xxx Xxxxx
(senior vice president and chief information officer), Xxxxxx X. Xxxxxx (vice
president and treasurer), Xxxxxxx X. Xxxxxxx (executive vice president), Xxxxxxx
X. Xxxxxxx (vice president and controller), Xxxxxx X. X'Xxxxxx (executive vice
president) and Xxxxxxxxx X. Xxxxxx (vice president-public affairs). As of the
date of this communication, none of the foregoing participants individually
beneficially owns in excess of 1% of Springs' Class A Common Stock or in excess
of 2% of Springs' Class B Common Stock and the foregoing participants in the
aggregate own less than 4.4% of Springs' Class A Common Stock and less than 3%
of Springs' Class B Common Stock. Trusts associated with the Close Family, of
which Xxxxxxxx X. Xxxxxx and Xxxxx X. Close are members, directly or indirectly
control shares of Springs common stock representing approximately 41% of the
equity and approximately 73% of the normal voting power of the common stock.
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Except as disclosed above, to the knowledge of Springs, none of the
directors or executive officers of Springs named above has any interest, direct
or indirect, by security holding or otherwise in Springs. Shareholders of
Springs may obtain additional information regarding the interests of the
participants by reading the proxy statement when it becomes available.
xxx.xxxxxxx.xxx
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