TransTechnology Concludes Purchase of Engineered Fasteners Division From Eaton Corporation, Refinances Debt.

LIBERTY CORNER, N.J.--(BUSINESS WIRE)--Aug. 31, 1999--

TransTechnology Corporation (NYSE:TT) today said it has concluded its previously announced purchase of the Engineered Fasteners Division ("EFD") of Eaton Corporation (NYSE:ETN) for $173 million cash.

TransTechnology will combine its Palnut(TM) fastener operation in Mountainside, New Jersey with the Engineered Fasteners units to form the Engineered Components Group. To be headquartered in Brunswick, Ohio, the Group will coordinate the activities of the three Engineered Fasteners facilities in Brunswick and Massillon, Ohio, and Hamilton, Ontario, with the Mountainside operation. The Group will have revenues of more than $115 million and approximately 800 employees.

In conjunction with the completion of the transaction, TransTechnology re-financed and expanded its existing lines of credit from $145 million to $325 million. The new credit facility is structured as a $250 million revolver/term loan and a $75 million bridge loan. The weighted average interest rate on the new facility, of which approximately $292 million was drawn, is approximately 9.65%.

Michael J. Berthelot, Chairman and Chief Executive Officer of TransTechnology, said "We are very excited about the growth opportunities that the Engineered Fastener business presents us. On a trailing twelve month proforma basis ended June 30, 1999, this transaction brings our revenues to $335 million and operating cash flow, or EBITDA, to almost $64 million. While we expect the effect of EFD to be neutral on EPS over the seven months remaining in the current fiscal year which ends March 31, 2000, we believe that EFD should contribute, after a charge of $.45 per share for goodwill amortization and stepped up depreciation, $.30-$.35 per share to net income in the next fiscal year which ends March 31, 2001.

"We have found a number of markets where the global resources of our Engineered Components Group will better serve customers in the retaining ring, hose clamp, and spring steel fastener industries, opening strong growth opportunities for us," Mr. Berthelot continued. "We are, of course, focused on reducing the debt burden we have taken on in this acquisition, and intend to use the substantial cash flow our company generates to retire this debt as quickly as possible. We believe that, assuming no further acquisitions or asset sales, we can return to a debt to total capitalization ratio of less than 50% within three years."

Joseph F. Spanier, Vice President and Chief Financial Officer of TransTechnology, said "We expect to enter the high yield subordinated debt markets with a $150 million issue in the fourth calendar quarter in order to retire the bridge loan and a portion of the senior facility. We believe that this capital structure will provide us with a strong base for future growth and maximization of cash flow."

TransTechnology, headquartered in Liberty Corner, New Jersey, is a multinational manufacturer of specialty fasteners and aerospace products with more than 2,600 employees at its 15 facilities in the U.S., Canada, England, Germany and Brazil. Sales for the fiscal year ended March 31, 1999 were $228 million.

Now the sixth largest fastener manufacturer in the United States, TransTechnology is also the largest manufacturer of retaining rings in the world, and a global leader in the design and manufacture of heavy duty hose clamps and spring steel fasteners. The company also manufactures rivets and externally threaded fasteners for the aerospace industry and specialty machined and cold headed products. TransTechnology's Aerospace Products Group is the world's leading manufacturer of sophisticated lifting and restraining products used on rescue missions by military and civilian helicopters, as well as of rods used to hold aircraft engine cowlings open.

Primary markets for TransTechnology's fastening products include heavy truck, off-road equipment, automobile, marine, civilian and military aircraft and consumer goods ranging from appliances to computers, toys, and photographic equipment. The Internet address for TransTechnology is http://www.transtechnology.com/

Eaton Corporation is a global manufacturer of highly engineered products that serve industrial, vehicle, construction, commercial, aerospace and semiconductor markets. Principal products include hydraulic products and fluid connectors, electrical power distribution and control equipment, truck drive-train systems, engine components, ion implanters and a wide variety of controls. Headquartered in Cleveland, the company has 64,500 employees and 215 manufacturing sites in 25 countries around the world. Eaton's sales for 1998 were $6.6 billion. On April 9, 1999, Eaton acquired Aeroquip-Vickers, Inc., which had sales of $2.1 billion in 1998. The Internet address for Eaton is http://www.eaton.com/

This release contains forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in such statements. Such risks and uncertainties include, but are not limited to, unanticipated slowdowns in the Company's major markets, the impact of competition, the effectiveness of operational changes expected to increase efficiency and productivity, and worldwide economic and political conditions and foreign currency fluctuations that may affect worldwide results of operations.