Textron Agrees to Sell Automotive Trim Unit to Collins & Aikman and Turbine Engine Components Unit to UC Acquisitions, Inc.

Business Editors

PROVIDENCE, R.I.--(BUSINESS WIRE)--Aug. 7, 2001

Recent Acquisitions and Divestitures Advance Company's Portfolio

Strategy; Textron Announces New Stock Buyback Program

In a major move to support its new portfolio strategy, Textron Inc. (NYSE: TXT) today announced a definitive agreement to sell its Automotive Trim business to Collins & Aikman Products Co., a subsidiary of Collins & Aikman Corporation (NYSE: CKC).

This transaction, combined with other recent portfolio actions, reduces Textron's automotive segment to 9% of total annualized revenues and supports the company's goal to create a simpler, more focused network of strong businesses in attractive industries. Textron Automotive Trim had 2000 revenues of over $1.8 billion. Textron's Kautex and CWC units are not part of the sale.

Textron will receive $1.0 billion in cash and assumed indebtedness plus preferred shares of Collins & Aikman Products Co. with a face value of $245 million, and 18 million shares of common stock of Collins & Aikman Corporation. Collins & Aikman has secured commitments for financing the transaction. The deal is expected to close in the fall and is subject to financing contingencies and customary regulatory review.

As part of its portfolio strategy, over the past six months Textron has gradually divested several other non-core assets serving the automotive industry, including its seating comfort product line, carbon materials business and electric motor components business. Textron Chairman and Chief Executive Officer Lewis Campbell said, "At the end of last year, we set a new course for Textron, committing to reduce our role in the automotive sector and redefine our portfolio. We are extremely pleased that we are able to make this major shift in our portfolio at an attractive valuation.

"This transaction is clearly a win-win for all parties. Collins & Aikman, which is creating one of the world's leading auto interior trim components suppliers, gains a world-class business in Textron Automotive Trim, including some of the most advanced technologies and one of the best management teams in the automotive supply business. As part of the Collins & Aikman enterprise, Textron Automotive Trim employees and customers gain the benefits of a dedicated automotive supply company with unrivaled scale and product range," Campbell continued.

Textron Agrees to Sell Turbine Engine Components Unit

Textron also has signed a definitive purchase and sale agreement for the sale of Turbine Engine Components Textron (TECT), a maker of internal components for gas turbine engines used in aircraft and industrial applications, to UC Acquisitions, Inc., a privately held holding company that owns Utica Corporation, a leading supplier of compressor, turbine and fan blades for gas turbines. TECT's 2000 revenues were approximately $125 million. Closing is expected to occur within 45 days following receipt of all necessary governmental approval and satisfaction of customary closing conditions. Terms of the transaction were not disclosed.

"TECT has been a strong business for Textron. However, it no longer matches our strategic goals," said Campbell. "We sought a buyer who would continue to grow and develop TECT's capabilities and found that buyer in UC Acquisitions," he continued.

TECT, which has four locations throughout the U.S., produces blades, forgings, impellers, blisks and rotating components. TECT customers include all major gas turbine engine original equipment manufacturers.

Board Approves New Share Repurchase Program

Textron also announced that its Board of Directors has authorized a new 12-million-share repurchase program. This program supersedes the 3.2 million shares that remained under its previous authorization.

Textron expects initial after-tax cash proceeds of at least $800 million from these two transactions, which will primarily be used to repurchase stock and pay down debt, consistent with its current debt ratings.

"We will be making stock repurchases opportunistically over the next two to three quarters as we redeploy a portion of the proceeds from these dispositions, balancing our desire to minimize dilution while realizing the best repurchase value. The new authorization also will offset the impact of various stock-based employee benefit plans over the next year or two," said Textron Executive Vice President and Chief Financial Officer Ted French.

The divestiture of Automotive Trim and TECT is expected to result in earnings dilution of approximately 2% to full-year 2001 earnings, with annualized dilution of less than 5% once the proceeds have been fully redeployed.

Recent Strategic Acquisitions Focus on Key Growth Opportunities

These divestitures are complemented by recent acquisitions made in the data-signal-voice test equipment business and commercial finance segment.

On July 18, Textron announced the purchase of Industrial Technology, Inc. and Opto-Electronics Inc. Both companies supply tools and technologies to install, test and measure the performance of copper and fiber-optic networks and will become part of Textron's Tempo business unit. They mark the seventh and eighth acquisitions made by Textron in this market segment during the past three years, bringing its Greenlee/Tempo business to over $400 million in annual revenues.

In addition, on June 5, Textron announced the acquisition of SunTrust Credit, a national provider of commercial finance services to the small business market. This acquisition further strengthens Textron Financial's Small Business group and supports the company's strategy to expand its market reach.

"We will continue to evaluate other acquisition and divestiture opportunities that are consistent with our strategic objectives and that will create additional value for our shareholders," said Campbell.

Conference Call Today

At 11:00 a.m. Eastern Time today, Textron will host a conference call to review the details of these divestitures and its portfolio management strategy. This call will be accessible via webcast at www.textron.com through the investor relations link on the homepage or by dialing 888-440-7918 in the U.S. or 952-559-2846 outside of the U.S.

About Textron Automotive Trim

Textron Automotive Trim, headquartered in Troy, MI, is a technology and cost leader in automotive plastics, including cockpits, instrument panels, door trim, consoles and other large injection molded components. In 2000, Textron Automotive Trim had revenues of over $1.8 billion. Textron Automotive Trim has approximately 13,000 employees and serves major automotive original equipment manufacturers (OEMs) worldwide.

About Collins & Aikman

Collins & Aikman Corporation, with annualized sales exceeding $2 billion, is the global leader in automotive floor and acoustic systems and is a leading supplier of automotive fabric, interior trim and convertible top systems. The Company's operations span the globe through 13 countries, more than 70 facilities, and over 14,000 employees who are committed to achieving total excellence. Collins & Aikman's high-quality products combine extensive design, styling and manufacturing capabilities with NVH "quiet" technologies that are among the most effective in the automotive industry. Information about Collins & Aikman is available on the Internet at www.collinsaikman.com.

About Textron

Textron Inc. (www.textron.com) is a $13 billion, global, multi-industry company with market-leading businesses in Aircraft, Automotive, Industrial Products, Fastening Systems and Finance. Textron has a workforce of 68,000 employees and major manufacturing facilities in 30 countries. Textron is among Fortune magazine's "Global Most Admired Companies" and Industry Week magazine's "Best Managed Companies."

Forward-looking Information: Certain statements in this release and other oral and written statements made by Textron from time to time, are forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or project revenues, income, returns or other financial measures. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in the statements, including the following: (a) the extent to which Textron is able to implement and complete its restructuring plan (b) the extent to which Textron is able to successfully integrate recent acquisitions, (c) changes in worldwide economic and political conditions that impact interest and foreign exchange rates, (d) the occurrence of work stoppages and strikes at key facilities of Textron or Textron's customers or suppliers, (e) government funding and program approvals affecting products being developed or sold under government programs, (f) successful implementation of supply chain and e-procurement strategies, (g) the timing of certifications of new aircraft products, (h) the occurrence of a severe downturn in the U.S. economies in which Textron operatesy that could reduce demand for its products discourages businesses from purchasing business aircraft (i) the level of consumer demand for the vehicle models for which Textron supplies parts to automotive original equipment manufacturers ("OEMs"), (j) Textron's ability to offset, through cost reductions, raw material price increases and pricing pressure brought by automotive OEM customers, (k) Textron Financial's ability to maintain credit quality and control costs when entering new markets, and (l) satisfaction of financing contingencies and successful completion of customary regulatory review required for the sale of Textron Automotive Trim.