MANITOWOC, Wis. — The Manitowoc Co. Inc. announced that its board of directors has approved a plan to pursue a separation of the company’s Cranes and Foodservice businesses into two independent, publicly-traded companies. The Foodservice business includes ice machines and refrigeration equipment.
The company currently anticipates carrying out the separation through a tax-free spin-off of the Foodservice business, and it expects the spin-off to be completed in the first quarter of 2016, creating two separate companies with distinct business strategies.
“Manitowoc’s management team and our board of directors regularly evaluate and explore opportunities to optimize the company’s performance and create value for shareholders,” said Glen E. Tellock, chairman and chief executive officer. “Manitowoc has taken and continues to take actions to enhance returns, including margin expansion initiatives, re-investment in our businesses, and utilization of our free cash flow to de-lever our balance sheet. We believe the separation of Cranes and Foodservice will position these businesses to take advantage of anticipated long-term improvement in demand and other opportunities in their respective markets.”
Tellock continued, “Over the past several years, we have transformed Manitowoc and worked to build two strong business platforms within one enterprise, and each business enjoys global leadership and is positioned for sustainable growth and value creation. After a comprehensive evaluation, including a thorough review of the current and projected operating environments for the two segments, we have determined that the Cranes and Foodservice businesses are best-suited to realize their full potential on a standalone basis.”
The Foodservice business, which reported annual revenue of $1.6 billion in the 12-month period ended Dec. 31, 2014, is a leader in the manufacture of commercial foodservice equipment serving the ice, beverage, refrigeration, food prep, and cooking needs of restaurants, convenience stores, hotels, hospitals, and other institutions. The business has a worldwide network of 120 distributors serving a number of restaurant chains. The business’s brands include Manitowoc, Garland, Convotherm, Cleveland, Lincoln, Merrychef, Frymaster, Delfield, Kolpak, Kysor Panel, Servend, Multiplex, KitchenCare, Inducs, Koolaire and Manitowoc Beverage System, and has a global presence that spans five continents and more than 80 countries.
Additional information on structure, management, governance, and other matters will be provided at a later date. The proposed separation is subject to customary conditions, including receipt of legal opinions concerning the tax-free nature of the transaction, effectiveness of appropriate filings with the Securities and Exchange Commission, and final approval by the company’s board of directors.
The company notes that any transaction of this type is dependent on numerous factors that include the macroeconomic environment, credit markets, and equity markets.
For more information, visit www.manitowoc.com.
Publication date: 2/9/2015