As Part of Restructuring Efforts, Raven Industries Agrees to Sell Its Glasstite Operation for $8.5 Million Cash
SIOUX FALLS, S.D., Oct. 29 /PRNewswire/ -- In what it labeled as "an important step in refocusing the company," Raven Industries, Inc. (Nasdaq: RAVN) today announced that it has signed a definitive agreement to sell the operating assets of its Glasstite subsidiary, which last year accounted for $20 million in sales, to Penda Corporation.
The sale of the company's pickup-truck topper operation includes manufacturing facilities in Dunnell, Minn. and Eloy, Ariz. Glasstite is part of the company's Plastics Segment, which last year reported sales of $70.8 million in engineered films, plastic tanks, high-altitude research balloons and pickup-truck toppers. Management expects the sale to be finalized by the end of October.
Raven President and CEO David A. Christensen noted that the sale price is approximately $8.5 million. No significant gain or loss is anticipated from the sale. "This is part of Raven's restructuring in which we intend to redeploy or dispose of non-core assets," Christensen said. "We intend to invest the net proceeds in our core business, in future acquisitions that are immediately accretive and high in cash return, and in the ongoing repurchase of Raven common stock, which at recent prices appears to us to be an exceptional opportunity." With long-term debt currently at approximately $3 million, or 5 percent of total capitalization, Christensen indicated that the company would not hesitate to increase the leverage of its balance sheet to increase shareholder returns.
This release contains discussions of items that may constitute forward-looking statements within the meaning of federal securities laws. Although Raven Industries believes that expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Factors that could cause actual results to differ from expectations include general economic conditions, weather conditions which could affect certain of the company's primary markets such as the agricultural market or its market for outerwear, or changes in competition which could impact any of the company's product lines.
For further information regarding Raven free of charge via fax, dial 1-800-PRO-INFO and enter "RAVN." On the Internet, information is available at FRB's website, http://www.frbinc.com, or at http://www.ravenind.com, the company's website.