GenTek Inc. Receives Proposal to be Acquired
PARSIPPANY, N.J., Oct. 4, 2007 (PRIME NEWSWIRE) -- GenTek Inc. (Nasdaq:GETI) announced today that it has received an unsolicited letter dated October 2, 2007 from funds managed by Abrams Capital, LLC, a principal stockholder of GenTek, informing the Company of its interest in pursuing a transaction by which the Abrams Funds would offer to purchase all outstanding shares of the GenTek common stock for $33.50 per share in cash on a fully diluted basis assuming the exercise of all outstanding GenTek warrants. The letter states the proposal is not subject to financing conditions. According to the letter, the Abrams Funds beneficially own approximately 2.5 million shares of GenTek common stock, which includes approximately 1.35 million shares issuable upon the exercise of warrants.
In reviewing the proposal, GenTek's Board of Directors first noted that the Company is not for sale. The Board also considered the Company's progress in continuously executing and reviewing strategies for increasing shareholder value. Among other things, the Board noted the Company's success in disposing of non-core and under-performing assets, renegotiating the terms of its debt financing, the redemption in full of its second lien term loan, the continuation of voluntary pre-payments on the Company's first lien term loan, and the recently announced stock re-purchase program. In addition, the Board reviewed the consistent improvements in General Chemical's operating results and the anticipated positive future impact of new business awards and manufacturing efficiency improvements in GT Technologies.
In considering the proposal in the context of the Company's strategies for shareholder value maximization and the Company's future prospects, the Board concluded that the proposal from Abrams Capital is inadequate and does not fairly value the Company.
About GenTek Inc.
GenTek provides specialty inorganic chemical products and services for treating water and wastewater, petroleum refining, and the manufacture of personal-care products, and valve-train systems and components for automotive engines. GenTek operates 50 manufacturing facilities and technical centers and has approximately 1,400 employees.
GenTek's 2,000-plus customers include many of the world's leading manufacturers of cars and trucks, and heavy equipment, in addition to global energy companies and makers of personal-care products. Additional information about the Company is available at the Company's web site: www.gentek-global.com.
Forward Looking Statements
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Certain statements, other than statements of historical facts, included herein may constitute forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that our assumptions made in connection with the forward-looking statements are reasonable, there can be no assurances that these assumptions and expectations will prove to have been correct. Important factors that could cause actual results to differ from these expectations include, among others, our outstanding indebtedness and leverage; the impact of the restrictions imposed by our indebtedness; our ability to fund and execute our business plan; potential adverse developments with respect to our liquidity or results of operations; the high degree of competition in certain of our businesses, and the potential for new competitors to enter into those businesses; continued or increased price pressure in our markets; customers and suppliers seeking contractual and credit terms less favorable to us; our ability to maintain customers and suppliers that are important to our operations; our ability to attract and retain new customers; the impact of possible substantial future cash funding requirements for our pension plans, including if investment returns on pension assets are lower than assumed; the impact of any possible failure to achieve targeted cost reductions; increases in the cost of raw materials, including energy and other inputs used to make our products; future modifications to existing laws and regulations affecting the environment, health and safety; discovery of unknown contingent liabilities, including environmental contamination at our facilities; suppliers' delays or inability to deliver key raw materials; breakdowns or closures of our or certain of our customers' plants or facilities; inability to obtain sufficient insurance coverage or the terms thereof; domestic and international economic conditions, fluctuations in interest rates and in foreign currency exchange rates; the cyclical nature of certain of our businesses and markets; the potential that actual results may differ from the estimates and assumptions used by management in the preparation of the consolidated financial statements; future technological advances which may affect our existing product lines; the potential exercise of our Tranche B and Tranche C warrants and other events could have a substantial dilutive effect on our common stock; and other risks detailed from time to time in our SEC reports. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur.
CONTACT: GenTek Inc.
Investor/Media Contact:
William E. Redmond
973-515-1821
IR@gentek-global.com
Source: PrimeNewswire (October 4, 2007 - 3:30 PM EDT)
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