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[August 2001]
Ferro on Track to Close its Largest Acquisition
Ferro Corporation's pending acquisition of certain dmc2 businesses from OM Group Inc - including Cerdec - is reportedly on track to close during the third quarter of 2001. The 30-day waiting period under the Hart-Scott-Rodine Antitrust Improvement Act expired on 30 July 2001, allowing Ferro to proceed with the acquisition.
A review by the regulatory agencies of a select number of European countries is now taking place. Although Ferro operates in many of the same markets as dmc2, the company does not foresee any objections to the acquisition by those regulatory bodies.
Under the terms of the agreement, Ferro will purchase the electronic materials, performance pigments, glass systems and Cerdec ceramics businesses of dmc2. Annual sales for these businesses were approximately US$520 million in 2000.
Ferro's own sales from ongoing operations for the quarter ended 30 June 2001 were US$355.2 million, compared to US$365.8 million in the same period in 2000. This made total sales for the first half of the year US$725.9 million as against US$726.4 million in the first half of 2000.
The second quarter 2001 sales in the Coatings segment were US$205.5 million, compared with US$225.9 million in the 2000 first quarter. Weak foreign currencies - particularly the euro - contributed significantly to this decline in sales. Segment income was US$17.7 million, compared with US$25 million in the 2000 quarter. Slowdowns in the US durable goods market, higher energy costs and the weak euro all contributed to the lower earnings for the segment.
ENDS