BFGoodrich Co. will buy Coltec Industries in a stock deal worth about $2.2 billion, the companies said Monday.
BFGoodrich (GR) is offering 0.56 of its shares for each Coltec (COT) share. The deal values Coltec shares at 20 1/8, up from 17 15/16 on Friday. BFGoodrich shares closed at 35 15/16 on Friday.The new company, which will move its headquarters to Charlotte, N.C., will have strong franchises in aerospace, specialty chemicals and engineered industrial products, according to David L. Burner, chairman and chief executive officer of BFGoodrich.
"This merger significantly enhances BFGoodrich's aerospace business," Burner said in a statement.
BFGoodrich no longer makes the tires sold under its brand name; Michelin does.
The companies said they expect the transaction to add to 1999 earnings and operating margins. The companies expect to achieve minimum annual cost savings of approximately $60 million by 2001.
BFGoodrich said about 170 workers in Ohio would be affected by the relocation of the headquarters; some would be offered an opportunity to relocate. Another 3,000 workers at BFGoodrich plants in Ohio will not be affected by the move.
Together, the companies have estimated 1998 pro forma revenues of approximately $5.5 billion and a market capitalization of approximately $4 billion.
Written By Rex Nutting