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Featherlite, Universal Trailer in $108 Million Merger Deal

August 1, 2006
Filed under Uncategorized

Featherlite, Inc. the Cresco, Iowa-based manufacturer and marketer of specialty aluminum trailers, transporters and luxury motorcoaches, has signed a definitive agreement to merge with a subsidiary of Universal Trailer Holdings Corp., Cincinnati, Ohio, a corporation with majority ownership by Dubin Clark & Company, a private equity investment firm. The transaction is valued at approximately $108.6 million.
Under the terms of the agreement, a subsidiary of Universal Trailer will merge with and into Featherlite, Featherlite will become a wholly-owned subsidiary of Universal Trailer, and Featherlite shareholders will receive $6.50 in cash for each outstanding share of Featherlite common stock. This price represents a 52.9 percent premium over the closing price of Featherlite stock on July 26. The aggregate consideration to be paid to Featherlite shareholders and option and warrant holders is approximately $79.5 million, and Universal Trailer will assume approximately $29.1 million in debt obligations.
A special committee of Featherlite’s outside directors has approved the merger. The merger is expected to be completed by October 31 and is subject to various conditions.
In addition, Featherlite Coaches, Inc., a newly formed company controlled by Conrad Clement, Featherlite’s Chairman, President and CEO, Tracy Clement, Featherlite’s Executive Vice President, and Bulk Resources, Inc., has entered into an agreement with Universal Trailer to purchase the assets and assume substantially all of the liabilities of Featherlite’s motorcoach division immediately following the closing of the merger with Featherlite.
Featherlite is not a party to this agreement and does not own any equity of Featherlite Coaches. The closing of the merger between Featherlite and Universal Trailer is subject to the agreement between Featherlite Coaches and Universal Trailer remaining in full force and effect.
Universal Trailer Holdings Corp. and its subsidiaries offer a diversified family of trailer brands that include Haulmark, Exiss, Sooner and Miley. Featherlite, Inc. has highly diversified product lines offering hundreds of standard model and custom-designed aluminum specialty trailers, specialized transporters, mobile marketing trailers and luxury motorcoaches.
Universal Trailer expects to retain the Featherlite trailer manufacturing locations and dealer network.
“We have been exploring alternatives to enhance shareholder value and build the strategic strength of the company since January of this year,” Featherlite President and CEO Conrad Clement said. “We believe this merger offers an excellent value for our shareholders and great new opportunities for Featherlite employees and dealers.”

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