Thursday, May 27, 2010

Machine tool consolidation continues

Based on a what it calls a positive response from Hardinge Inc. (Nasdaq: HDNG) shareholders, Industrias Romi S.A. (Bovespa: ROMI3) ("Romi"), a leading global manufacturer of machine tools, today announced the extension of the offering period for its tender offer to acquire all of the outstanding shares of Hardinge for $10.00 per share to 5:00 pm, New York City time, on June 18, 2010, unless further extended or terminated.

The offer and withdrawal rights were previously scheduled to expire at 5:00 pm, New York City time, on May 26, 2010. As of 5:00 pm, New York City time, on May 26, 2010, 4,444,444 shares, representing over 38% of Hardinge's outstanding shares, have been validly tendered and not withdrawn.

The $10.00 per share all-cash offer represents a premium of 105% to Hardinge's closing share price on December 14, 2009, when Romi first formally communicated to Hardinge its interest in pursuing a business combination. The offer is not subject to confirmatory due diligence or any financing condition and will be funded entirely from Romi's internal resources.

Hardinge Inc. is an international provider of advanced metal-cutting solutions. The Company has a very diverse international customer base and serves a wide variety of end-user markets. Along with metalworking manufacturers that make parts for a variety of industries, its customers include numerous end users in the aerospace, agricultural, transportation, basic consumer goods, communications and electronics, construction, defense, energy, pharmaceutical and medical equipment, and recreation industries, among others. Hardinge employs approximately 1,138 employees worldwide with manufacturing operations in the United States, Switzerland, Taiwan and China. Its global headquarters are located in Elmira, N.Y.

"Over the past several weeks we have had the opportunity to engage in productive dialogue with many Hardinge shareholders," said Livaldo Aguiar dos Santos, Chief Executive Officer of Romi. "We believe that these tender results, together with the significant withhold vote against the Hardinge director nominees at this year's annual meeting, are a clear indication that a large number of shareholders want Hardinge to dismantle its aggressive takeover defenses and negotiate a transaction with Romi.

"Given the ongoing consolidation in the machine tools industry and the significant competitive pressures facing Hardinge, we continue to believe that a transaction with Romi, which would provide Hardinge shareholders immediate liquidity at superior value, is the best strategic alternative available to Hardinge. Based on Romi's 80-year experience in the industry, and in view of the fact that Hardinge has not shared the detailed forecasts or valuation analysis that led them to reject our increased offer, we do not believe that Hardinge's current standalone business model will deliver equivalent or superior value, particularly given the uncertainty surrounding the strength of a potential recovery," continued Mr. dos Santos.

Industrias Romi S.A. (Bovespa: ROMI3), founded in 1930, is a market leader in the Brazilian machinery and equipment industry. The company manufactures machine tools, mainly lathes and machining centers, plastic injection and blow molding machines for thermoplastics and parts made of grey, nodular or vermicular cast iron, which are supplied rough or machined. The company's products and services are sold globally and used by a variety of industries, such as the automotive, general consumer goods and industrial and agricultural machinery and equipment industries

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