Watts Industries, Inc. Receives Favorable IRS Ruling On Tax-Free Treatment of New Spin-Off.NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Sept. 14, 1999-- CIRCOR International, Inc. is Established; New Company to Comprise Instrumentation, Petrochemical and Steam Businesses Watts Industries, Inc. (NYSE NYSE See: New York Stock Exchange :WTS See Windows Terminal Server. ) today announced it has received a favorable ruling from the Internal Revenue Service regarding the tax-free treatment of the spin-off it announced on December 15, 1998. Watts also announced that the name of the spin-off will be CIRCOR International, Inc. and that the new company has arranged for initial debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay to retire indebtedness assumed from Watts and for working capital purposes. CIRCOR announced that it has engaged ING Barings LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control to obtain initial debt financing and a revolving credit arrangement. Following the receipt of the IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. private letter ruling, Watts is proceeding with plans to separate the industrial and oil and gas businesses from its existing plumbing and heating and water quality businesses. All of the outstanding common stock of the new company will be distributed to Watts stockholders in the form of a pro-rata stock dividend. An announcement concerning the record date and payment date will be made after approval by the Watts Board of Directors. As previously announced, Timothy P. Horne will remain Chairman and Chief Executive Officer of Watts. David A. Bloss, Sr., currently President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. of Watts, will be appointed Chairman, President, and Chief Executive Officer of CIRCOR. A senior management team and Board of Directors will be announced within the next few weeks. "The favorable ruling from the IRS is welcome news." said Horne. "We can now move into the final stages of this transaction. We believe the separation will permit the financial markets to better recognize and evaluate the individual merits of the plumbing and heating and water quality business of Watts, on the one hand, and the industrial, oil and gas businesses of CIRCOR on the other. Additionally, each company can now fully focus on its core business objectives and pursue growth opportunities," added Horne. Following completion of the spin-off, CIRCOR and its affiliates will own and operate all of the businesses that presently comprise Watts' industrial, oil and gas businesses. CIRCOR's business will consist of (i) its Instrumentation and Fluid Regulation Products Group which will include Aerodyne aer·o·dyne n. A heavier-than-air aircraft deriving lift from motion. [aero- + Greek dunamis, power (from dunasthai, to be able; see deu-2 Controls Corp., Atkomatic Valve Company, Circle Seal Controls, Inc., GO Regulator, Inc., Hoke hoke tr.v. hoked, hok·ing, hokes Slang To give an impressive but artificial, false, or deceptive quality to: hoked up some phony allegations. , Inc., Leslie Controls, Inc., Nicholson Steam Trap and Spence Engineering Company, Inc., and (ii) its Petrochemical Products Group which will include Contromatics Industrial Products, Eagle Check Valve, KF Industries, Inc., Pibiviesse S.p.A., Suzhou Watts Valve Co., Ltd., SSI (1) See server-side include and single-system image. (2) (Small-Scale Integration) Less than 100 transistors on a chip. See MSI, LSI, VLSI and ULSI. 1. (electronics) SSI - small scale integration. 2. Equipment Inc. and Telford Valve and Specialties. Watts' business will consist of its plumbing and heating and water quality business which includes the Company's flagship subsidiary Watts Regulator Company, as well as Ames Company, Inc., Anderson-Barrows Metals Corporation. Tianjin Tanggu Watts Valve Co., Ltd., Watts Brass and Tubular, Watts Drainage Products, Inc., Watts Industries (Canada), Inc. and Watts Industries Europe B.V. including its subsidiaries, Watts Ocean B.V., Watts Intermes S.p.A., Cazzaniga S.p.A., Watts MTR MTR Motor MTR Meter MTR Mass Transit Railway MTR Mountaintop Removal (coal mining method) MTR Mid-Term Review MTR Mortar MTR Museum of Television and Radio MTR Magnetization Transfer Ratio . GmbH, Watts Eurotherm, S.A., and Watts GRC GRC Greece (ISO Country code) GRC Glenn Research Center (NASA) GRC Governance, Risk and Compliance GRC Gendarmerie Royale du Canada (RCMP - Canada) GRC John H. S.A. Horne said, "the separation of the aforementioned units from the plumbing and heating and water quality businesses is designed to achieve two primary objectives: --To improve management focus toward the differing needs of these two businesses to allow faster growth and flexibility by permitting each company to separately access the public equity markets and raise capital to support market growth and future strategic acquisitions; and --To better meet the unique customer demands of each business in global markets that are undergoing dramatic change." Watts expects the financial transactions and regulatory approvals for this spin-off to be complete during October. CIRCOR's corporate headquarters will be located at 35 Corporate Drive, Burlington, Mass. |
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