Manitowoc Files Form 10 Pertaining to Foodservice Split
Manitowoc Company, Inc. MTW has filed a Form 10 Registration Statement with the U.S. Securities and Exchange Commission (SEC) pertaining to its previously announced plan to separate the Cranes and Foodservice businesses into two industry-leading, independent, public companies. This marks an important milestone in achieving this objective.
The initial Form 10 Registration Statement consists of salient information about the Foodservice business, such as, historical segment sales and profit. The Foodservice business has not yet finalized its post-Distribution capitalization structure. Pro-forma financial information reflecting the company's post-Distribution capitalization, among other matters, will be included in a subsequent amendment to the Form 10.
Approval of Manitowoc’s board of directors for the separation as well as the satisfaction of certain other customary conditions is pending. Manitowoc expects the tax-free spin-off of the Foodservice business to be completed in the first quarter of 2016.
According to Manitowoc, the separation will allow each company to focus on its unique growth profile, product categories, distribution systems, and strategic priorities. The separation will also enable each company to implement the right organizational structure, operating model, and financial targets. Manitowoc, however, noted that there can be no assurance that a separation will ultimately occur and of the definite timing in case it is successfully completed. These types of transactions depend on various other factors, such as, the macroeconomic environment, credit markets and equity markets.
The Goldman Sachs Group, Inc. GS is serving as financial advisor and Foley & Lardner LLP and Skadden, Arps, Slate, Meagher & Flom LLP are serving as legal advisors to Manitowoc.
In January, Manitowoc announced its plans to separate its Cranes and Foodservice businesses into two independent, publicly traded companies, facing increasing pressure from investors and tough business conditions.
The Foodservice business is a leading manufacturer of commercial foodservice equipment, serving the ice, beverage, refrigeration, food preparation and cooking needs of restaurants, convenience stores, hotels, healthcare and institutional applications. Its Foodservice products are marketed under the Manitowoc, SerVend, Kolpak, Cleveland, Delfield, Frymaster, Garland, Lincoln and other brand names. The business generated revenues of $1.6 billion in fiscal 2014, contributing 41% to Manitowoc’s revenues.
The Crane business is a global provider of engineered lift solutions, offering one of the broadest lines of lifting equipment in the industry. It reported revenues of $2.3 billion in fiscal 2014.
For 2015, Crane sales are now expected to decline in double digits and operating margin guidance is at mid-single-digit percentage. Guidance for revenues in foodservice, is approximately flat with 2014, while operating margin is expected in the mid teens percentage.
Manitowoc currently has a Zacks Rank #3 (Hold).
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