Fortive Corporation · NYSE:FTV
Fortive — Merger or Acquisition (March 2018)
25 slides from Fortive's merger presentation, Mar 7, 2018
Slide 1: Filed by Fortive Corporation pursuant to Rule 425
Filed by Fortive Corporation pursuant to Rule 425 under the Securities Act of 1933 Subject Company: Fortive Corporation Commission File Number: 001-37654 The following presentation from a joint investor call conducted by Altra Industrial Motion Corp. and Fortive Corporation has been made available o
Slide 2: Altra Combination with Fortive A&S: Creating a Global Leader in Power Transmission and Motion Control
March 7, 2018 Altra Combination with Fortive A&S Creating a Global Leader in Power Transmission and Motion Control
Slide 3: Additional Information
ADDITIONAL INFORMATION This communication does not constitute an offer to buy, or a solicitation of an offer to sell, any securities of Fortive Corporation (“Fortive”), Stevens Holding Company, Inc. (“Newco”) or Altra Industrial Motion Corp. (“Altra”). In connection with the proposed transaction, Al
Slide 4: Safe Harbor & Non-GAAP Financial Metrics
Safe Harbor & Non-GAAP Financial Metrics Forward Looking Statements: This communication contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which reflect Altra’s current estimates, expectations and projections about Altra’s and t
Slide 5: Today's Presenters
Today’s Presenters Carl Christenson Chairman & Chief Executive Officer Altra Christian Storch Vice President & Chief Financial Officer Altra Jim Lico President & Chief Executive Officer Fortive Chuck McLaughlin Senior Vice President & Chief Financial Officer Fortive
Slide 6: A Uniquely Compelling and Differentiated Industrial Combination
A Uniquely Compelling and Differentiated Industrial Combination ¹ Combined company 2017 revenues. Expands Presence Across the Technology Spectrum Into Highly Attractive Area From Electrical-Mechanical Capabilities to Precision Motion Control Expertise Increases Exposure to End Markets With Attractiv
Slide 7: A Highly Complementary Combination
A Highly Complementary Combination Automation & Specialty A global leader in electromechanical power transmission A leading player globally in multiple automation categories and go-to partner for optimized cost/performance 23 industry-leading brands averaging 75 years of market expertise Four market
Slide 8: Transaction Summary
Transaction Summary Structure & Consideration Altra to combine with Fortive A&S in a tax-efficient transaction valued at $3.0bn $1.4bn of cash proceeds and debt reduction for Fortive Fortive shareholders to receive 35mm newly issued Altra shares, 54% ownership in the combined entity Newly issued sha
Slide 9: Transaction Benefits for Fortive and its Shareholders
Transaction Benefits for Fortive and its Shareholders Jim Lico President & Chief Executive Officer Fortive
Slide 10: Fortive A&S Is a Leader in Precision Motion Control Solutions
Fortive A&S Is a Leader in Precision Motion Control Solutions Note: Hengstler and Dynapar, Fortive’s encoder brands within the A&S portfolio, are not part of the transaction and will remain a part of Fortive. 2017 Actual Results A World Leader in Rotary Precision Motion Solutions 2017 Revenue Breakd
Slide 11: Majority Ownership of the Highly-Attractive Combined Company
Majority Ownership of the Highly-Attractive Combined Company Stronger than A&S standalone – a global leader in Power Transmission and Motion Control Strategic partner with proven track record as a public company Post Transaction, Fortive Shareholders Will Own An Industry Leading PTMC Company 54% own
Slide 12: Accelerates Portfolio Enhancement
Accelerates Portfolio Enhancement Increases Relative Recurring Revenue Content (Software / SaaS / Service) Provides Significant Increase in M&A Capacity Contributes to the Fortive Formula for Value Creation Transaction Is Consistent with Fortive’s Long-Term Portfolio Strategy 1 2 3 4 And… Investment
Slide 13: Rationale for the Combination
Rationale for the Combination Carl Christenson Chairman & Chief Executive Officer Altra
Slide 14: Altra Accelerates Transformation Into a Premier Industrial Company
DECEMBER 2006 Altra IPO OCTOBER 2016 Acquired Stromag DECEMBER 2013 Acquired Svendborg Brakes FEBRUARY 2011 Acquired Bauer Geared Motors MAY 2006 Acquired Bear Linear APRIL 2004 Genstar purchased Colfax Power Transmission and Kilian Manufacturing to form Altra Accelerates Altra’s Transformation Into
Slide 15: A&S Creates a Leading Power Transmission Motion Control Company
2017A Revenue: $0.9bn A&S Creates a Leading Power Transmission Motion Control Company A Focused Leader in Power Transmission 2017A Revenue: $0.9bn A Focused Leader in Motion Control Combined Company Portfolio of Premium Brands A leader in Power Transmission and Motion Control Adds precision motion a
Slide 16: Moves Altra Up the Technology Spectrum
Altra Focus Moves Altra Up the Technology Spectrum Bearings Chain Drives Belted Drives Adjustable Speed DrivesMotors Sensors Hydraulics Pneumatics Ind. Chemicals Plant Automation Material Handling Std. PT Adjacent Products Source: Industrial Market Information Inc., Channel Marketing Group, PTDA 201
Slide 17: Diversifies End-Market Exposure, Increases Exposure to Attractive Markets
Diversifies End-Market Exposure, Increases Exposure to Attractive Markets Broad market coverage Increases position in higher-growth verticals (medical, robotics) Reduces exposure to more cyclical end-markets (mining, oil & gas) Robotic / Precision surgery Hygienic standards Operator-robot collaborat
Slide 18: A Global Footprint to Serve Customers Locally
A Global Footprint to Serve Customers Locally 50% North America U.S. Industrial sector strength Leading category positions Strong brands Facility consolidation opportunities Management expects North America to be strong in 2018 31% Europe Well-positioned to capture European revival Recovering macro
Slide 19: World-Class Business System With Strong Policy Deployment Capabilities
World-Class Business System With Strong Policy Deployment Capabilities LEADERSHIP GROWTH LEAN Combined company will benefit from application of best-in-class business systems Significant engagement with customers to understand their requirements and improvement objectives Engineering teams strive to
Slide 20: Transaction Financials and Structure
Transaction Financials and Structure Christian Storch Vice President & Chief Financial Officer Altra
Slide 21: Significantly Improved Financial Profile
Significantly Improved Financial Profile ¹ Does not take into account benefit of synergies. ² Represents unlevered free cash flow calculated as post-tax EBIT + D&A + stock-based comp – capex – increase in net working capital; does not take into account benefit of synergies. Altra 2017 Combined Compa
Slide 22: Attractive Synergies of More Than $50mm Expected
Attractive Synergies of More Than $50mm Expected Clearly identified estimated run-rate synergies of more than $50mm Upside from estimated revenue synergies ($20mm revenue, $6mm EBITDA drop through) Strong culture of continuous improvement at each organization to support synergy realization Cost Syne
Slide 23: Expected Significant Free Cash Flow Enabling Altra to De-lever Quickly
Expected Significant Free Cash Flow Enabling Altra to De-lever Quickly Combined Company Net Debt / LTM EBITDA ¹ Estimated Altra Net Debt/LTM EBITDA at close, Including 50% credit for estimated run-rate cost synergies of $46mm. Altra to prioritize debt pay down until leverage metrics return to 2.0-3.
Slide 24: Confidence in Ability to Integrate and Execute on Transaction Benefits
Confidence in Ability to Integrate And Execute on Transaction Benefits Risk Mitigation Benefits Under Altra Ownership Combined business is stable and growing Lower cost structure will improve win rates Increased customer diversification and end-market exposure Cover customers across a broader techno
Slide 25: Summary of Transaction Benefits
Summary of Transaction Benefits Creates a Leading Power Transmission and Motion Control Company Moves Altra up the Technology Spectrum Highly Complementary Product Offerings, Capabilities, and End-Markets Improved Financial Profile with Higher Revenue and Earnings Growth and Better Margins Clearly I