Nacco Industries to spin off Hamilton Beach/Proctor-Silex to stockholders

By Lisa Kerner

Charlotte, N.C., April 26 - Nacco Industries, Inc.'s board approved the planed spinoff of the company's Hamilton Beach/Proctor-Silex business to Nacco stockholders.

The spinoff, slated to be completed by the end of June, will establish the business as an independent public company to be listed on the New York Stock Exchange and known as Hamilton Beach, Inc.

Nacco stockholders will receive shares in Hamilton Beach, Inc. while also retaining their shares of Nacco common stock.

In the spinoff, Nacco class A and class B stockholders will receive one half of one share of Hamilton Beach class A common stock and one half of one share of Hamilton Beach class B common stock for each share of Nacco class A and class B common stock they own.

The transaction calls for Nacco to receive a special cash dividend of $110 million from Hamilton Beach prior to the spinoff. Financing commitments have been secured for payment of the dividend.

In addition, Hamilton Beach's $115 million asset-based revolving credit agreement is expected to be amended to allow for the issuance of a new $125 million senior secured term loan.

Michael J. Morecroft, Hamilton Beach's current president and chief executive officer, will continue to lead the company.

"The spinoff is strategically compelling in that it is expected to create the opportunity for significant value enhancement for our stockholders and accomplish important business objectives for Hamilton Beach," Nacco chairman, president and chief executive officer Alfred M. Rankin, Jr. said in a company news release.

"We believe Nacco stockholders will benefit from direct ownership in Hamilton Beach, a strong, established company with leading brand names and a proven management team. Further, Hamilton Beach will have greater flexibility to pursue strategic growth opportunities and enhanced access to the equity and debt capital markets."

Rankin is expected to become the non-executive chairman of Hamilton Beach's board of directors.

UBS Investment Bank acted as financial adviser and Jones Day acted as legal adviser to Nacco. McGuireWoods LLP acted as legal adviser to Hamilton Beach.

Nacco announced a definitive agreement on July 24, 2006 to spin off its Hamilton Beach/Proctor-Silex business as part of its merger with Florida-based small household appliance distributor Applica Inc.

Nacco is a Mayfield Heights, Ohio-based operating holding company with three principal businesses: lift trucks, housewares and mining.

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