ST. LOUIS and SCHAUMBERGER, IL — Belden and CDT announced recently that the boards of directors of the two companies have collectively approved and entered into an agreement providing for a "merger of equals." The newly formed company will be called Belden CDT, and will be headquartered in St. Louis. With sales of approximately US$1.3 billion, Belden CDT will be among the largest U.S.-based manufacturers of high-speed electronic copper cable and will focus on products for the specialty electronics and data networking markets, including connectivity. The deal is expected to be complete during the second quarter of 2004.
Under the terms of agreement, Belden shares will be exchanged for two shares of CDT each. Upon completion of the merger, Belden CDT will execute a one-for-two reverse stock split, thereby reducing the number of shares. Belden CDT is expected to have approximately 46 million shares outstanding after the reverse split. It will also expect to continue Belden's dividend policy of $0.05 per share quarterly. The former CDT shareholders will own approximately 45% of the combined and the former Belden shareholders will own approximately 55% of the combined company. Belden CDT expects to be listed on the NYSE under a new ticker symbol.
Upon completion of the merger, Bryan C. Cressey, chairman of the board of CDT, will serve as chairman of the board of the newly combined company. And C. Baker Cunningham, chairman, president, and chief executive officer of Belden will serve as president and chief executive officer of Belden CDT. Ferdinand Kuznik, currently CDT's chief executive officer and George Graeber, currently serving as CDT's president and chief operating officer, will join the office of the CEO of Belden CDT to advise and assist in the integration of the two businesses and will focus on realizing expected synergies. Richard K. Reece, vice president, finance and chief financial officer of Belden, will have the same role in the newly merged company.
The combined company's board will consist of ten directors, five designated by each of the companies from their current boards, including Cressey, Cunningham, and Kuznik.
"The merger of Belden and CDT with its synergies provides the opportunity to increase shareholder value by reducing costs, broadening the product portfolio, diversifying core markets, and combining a deep and experienced management team," said Cressey. "These benefits and the strength of the combined balance sheet will provide financial flexibility and set us apart from others in our industry."
"The merger of Belden and CDT, both leaders in the cable and wire industry, creates a preeminent supplier of electronic and specialty products," said Cunningham. "The combination of well-known specialty brands means that we have a more comprehensive array of products and a broader range of preferred cabling and connectivity solutions. Expected synergies of approximately $25 million through the implementation of best practices and elimination of duplicate costs will make us more competitive in providing value to our customers," he concluded.
