Amcast To Acquire Speedline, a Major European Aluminum Wheel Manufacturer.

DAYTON, Ohio--(BUSINESS WIRE)--July 28, 1997--Amcast Industrial Corporation (NYSE:AIZ) today announced that its Board of Directors has approved an agreement to acquire all of the outstanding stock of Speedline SpA, located in an industrial region near Padova, Italy, a major European manufacturer of light alloy wheels serving the automotive industry. The consideration to be paid to the sellers for the acquisition totals approximately $132 million in a combination of cash, Amcast stock, and debt assumption.

Speedline, a 30-year old company established by the Zacchello family, manufactures aluminum and magnesium alloy wheels for European automakers, including Mercedes-Benz, Audi, Fiat, Peugeot, Porsche, Renault, Rolls-Royce, Rover, Volkswagen, among others and, in the United States, Corvette.

Amcast, the third largest U.S. aluminum wheel manufacturer, will increase its total global wheel production to six million units with the Speedline acquisition, according to John H. Shuey, Amcast President and Chief Executive Officer

"This strategic acquisition, which is expected to be completed later this summer, will be the most significant single action in the 131-year history of our company," Shuey said.

Today, approximately half of U.S. cars and light trucks are purchased with original equipment aluminum wheels, while only about 20 percent of European cars currently use original equipment aluminum wheels. Increased penetration of aluminum wheels is expected to continue on both continents.

"Achieving significant weight reduction drives aluminum wheel technology and design," Shuey said. "Corporate Average Fuel Economy (CAFE) requirements mandate lighter car and truck fleets in the United States, while $4-a-gallon gasoline in Europe creates an economic incentive for improved mileage and, hence, greater aluminum use in vehicles," Shuey added.

"Amcast, whose largest U.S. aluminum wheel customer is General Motors, will significantly broaden its wheel product offerings and technology with Speedline," Shuey said. "In addition to aluminum original equipment passenger car wheel production, Speedline also manufactures racing wheels, aftermarket wheels, truck wheels, hubs and caps, industrial vehicle wheels, magnesium wheels, modular wheels, and motorcycle wheels. Speedline has a well-deserved reputation as a technology leader not only in Europe but around the world," Shuey said. The northern Italian wheel producer has ISO 9001 certification and has won many supplier quality awards over the years.

Speedline's sales base is broad as it sells into virtually all European car manufacturing countries with Germany, Italy, France, and the United Kingdom leading the way.

In commenting on the strategic importance of the combination, Shuey stated "achieving a critical mass in the world aluminum wheel business has been one of our strategic goals. Today a sales base of at least five million wheels annually is necessary to support spending for research and development in materials, manufacturing processes, and product design. Equally important, with the combination of Speedline and Amcast, our company becomes a global supplier and diversifies our aluminum wheel customer base beyond being largely a supplier to General Motors. We attain a significant presence in Europe, which our U.S.-based customers have been urging us to do, and we have a significant European launch platform for our exciting, new aluminum product family of performance-critical, underbody suspension components."

"The globalization trend of larger automotive suppliers dictated that Speedline find a partner," according to Giancarlo Zacchello, the present head of the business and principal owner. "Speedline became Europe's preferred racing car wheel maker and leading original equipment aluminum wheel supplier by aggressive spending to advance the state-of-the-art in wheel technology. Amcast's aluminum technology leadership in the U.S. makes it the perfect partner for Speedline," Zacchello said.

"Together, our two companies will be a global force in exploiting the aluminum wave for components to reduce automotive weight, while increasing vehicle handling and ride characteristics," Shuey and Zacchello said.

"Speedline's well-regarded commitment to technology and quality matches well with Amcast's technical leadership and industry vision. The blending of cultures between Amcast and Speedline will be made easier since our individual aluminum technology leadership and product quality transcend national boundaries in the eyes of our global customers," Shuey and Zacchello said.

Speedline has four aluminum wheel manufacturing plants in northern Italy, employing over 1,100 associates. Zacchello will remain actively involved with Speedline and remain on Speedline's Board of Directors. In addition, Zacchello, whose family will become Amcast's largest individual shareholders upon completion of the acquisition, holding approximately 5 percent of its stock, is expected to join Amcast's Board of Directors after the acquisition is completed. Giovanni Scarlini, currently Director General, will continue to manage the day-to-day operations of Speedline as part of Amcast and report directly to Shuey.

In 1996, Speedline had sales of approximately $193 million. The acquisition is not expected to be dilutive to the 1998 results of Amcast.

Amcast is expected to benefit from the long-term combination of best practices in manufacturing and technology as well as the pursuit of unique cross-selling opportunities that are possible.

Amcast's long-term debt to total capitalization ratio will increase to approximately 55 percent following the acquisition. "This increase is well within our capability for a strategic opportunity of this magnitude and impact," Shuey said. "Our objective will be to lower our leverage to 30-to-40 percent over time." The transaction will be initially financed through a commercial banking facility.

The transaction is subject to satisfaction of certain conditions of the agreement and required regulatory approvals.

Shuey also stated that Amcast will be reviewing its current operating structure in view of this major acquisition.

Headquartered in Dayton, Ohio, Amcast is a leading manufacturer of technology-intensive metal products. Sales in 1996 were $344 million with net income of $15.9 million. Its two business segments are brand name flow control products marketed through national distribution channels and engineered components for original equipment manufacturers. The company serves four major sectors of the economy: automotive, construction, industrial, and aerospace.

CONTACT: Amcast Industrial Corporation

Media: John Shuey, 937/291-7020

Phyllis Naylor, 937/291-7011

Investors/Analysts: Mike Higgins, 937/291-7015