Kenosha, WI | October 23, 2006 — Snap-on Incorporated (NYSE:SNA), a leading global innovator, manufacturer and marketer of tools, diagnostics and equipment solutions for professional users, today announced that it has entered into a definitive agreement to acquire ProQuest Business Solutions from ProQuest Company (NYSE:PQE) for approximately $480 million in cash plus the assumption of $19 million of debt.
ProQuest Business Solutions is a world leader in automotive parts and service information. Its products are aimed at helping original equipment manufacturers (OEMs) and their dealers enhance their service operations. ProQuest Business Solutions’ products include integrated software, services and systems that transform complex technical data for parts catalogs into easily accessed electronic information (electronic parts catalogs (EPCs)). Other products and services include warranty management systems and analytics to help dealerships manage and track performance. Over 33,000 automotive dealerships around the world use ProQuest Business Solutions’ EPCs, which are available in 26 different languages and support 15 automotive manufacturers and 31 brands. ProQuest Business Solutions’ products are also sold to over 85,000 dealers in the power equipment and power sports markets. Unaudited revenues for the 12 months ended June 2006 were $185 million.
“This is a compelling strategic transaction that affords exciting growth opportunities for our customers, associates and shareholders,” said Jack D. Michaels, Snap-on’s chairman, president and chief executive officer. “Our Diagnostics and Information Group has successfully built a solid financial and operating platform and has earned the right to grow by acquisition. This acquisition should further leverage that strength. ProQuest Business Solutions’ ability to consolidate and transform complex manufacturer data from disparate sources into cohesive, integrated and highly customized systems makes it an important addition to our Diagnostics and Information Group. By integrating our complementary capabilities, we believe Snap-on will be uniquely positioned to add value for global OEMs and enhance the productivity and profitability of their dealerships.
“While we execute on this acquisition, we will maintain the positive momentum achieved with our strategic growth initiatives in Snap-on’s Commercial and Industrial Group and Tools Group. We have great confidence that these initiatives, together with this transaction, position Snap-on for sustained growth and value creation,” said Michaels.
“Snap-on shares our goal of being the global provider of choice for integrated information solutions for the automotive, power equipment and power sports markets,” said Andrew Wyszkowski, president of ProQuest Business Solutions. “We believe that together with Snap-on’s diagnostics and information capabilities, we can further enhance our offerings for our global OEM and dealership customers.”
“We have great admiration for the ProQuest Business Solutions team and the record of innovation they have established,” continued Michaels. “We welcome ProQuest Business Solutions’ associates to Snap-on and anticipate them to be an important part of our continued growth and success.”
Strategic and Financial Benefits of the Transaction
-- Expands Snap-on's Solutions Offering for Global Automotive OEM Dealership Segment: The increasing complexity of vehicles with advanced electronics has led to rising demand for superior diagnostics and information solutions in the vehicle service and repair marketplace. Through its Diagnostics and Information Group, Snap-on currently offers a wide range of diagnostics software, vehicle-service information and business management systems, including a complete line of integrated software tools that enables users to electronically access service repair and parts information to maximize shop productivity. The acquisition of ProQuest Business Solutions further expands this offering with EPCs for OEM dealerships on a global basis and, along with Snap-on's existing capabilities, enables Snap-on to provide its global OEMs and their dealerships with complete parts and service solutions.
-- Accelerates Snap-on's Earnings and Cash Flow Growth: Snap-on expects the transaction to be accretive to earnings per share (based upon preliminary purchase accounting valuation assessments) and cash flow in early 2007.
-- Maintains Snap-on's Financial Strength and Flexibility: Snap-on intends to fund the transaction through a combination of cash and borrowings under existing facilities. Snap-on expects its consolidated cash flow available for the repayment of acquisition indebtedness to be $100 million or more annually. In addition, consolidated cash flow is expected to provide for the continued funding of Snap-on's franchise, product, brand, customer service, and supply chain initiatives, including its strategic growth initiatives in its other businesses.
About ProQuest Business Solutions
ProQuest Business Solutions, headquartered in Richfield, Ohio, is a world leader in electronic parts catalogs. ProQuest products transform complex technical data for parts catalogs into easily accessed electronic information for the world's automotive, power equipment and power sports manufacturers and their dealer networks. ProQuest also provides warranty management systems and analytics to help dealerships manage and track performance.
About Snap-on
Snap-on Incorporated is a leading global innovator, manufacturer and marketer of tools, diagnostics and equipment solutions for professional users. Product lines include hand and power tools, tool storage, diagnostics software, information and management systems, shop equipment and other solutions for vehicle manufacturers, dealerships and repair centers, as well as customers in industry, government, agriculture and construction. Products are sold through its franchisees, company-direct sales and distributor channels, as well as over the Internet. Founded in 1920, Snap-on is a $2.4 billion, S&P 500 company headquartered in Kenosha, Wisconsin.
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