Kimball to Spin Off EMS Unit PDF Print E-mail
Written by Mike Buetow   
Monday, 20 January 2014 09:30

JASPER, IN -- Kimball International plans to spin off its electronics manufacturing services business unit under a separate stock listing. The unit will be named Kimball Electronics, and will result in shareholders owning two standalone publicly traded companies.

The company's board expects the spin off, which is intended to be tax-free to shareholders, to be completed in approximately eight to 12 months.

Kimball International will continue to operate its office and hospitality furniture manufacturing business.

“Surviving required a constant reinvention of the company within the markets we serve. These changes have been most acute in the last decade as we have developed a true global platform to serve customers within the EMS industry, as well as the impact of offshore manufacturing in the furniture industry. As such, our board determined that it is time to separate these businesses to allow for greater focus and growth," said Douglas A. Habig, chairman. "The board believes separating into two public companies will enable investors to value our different businesses separately, creating value and opportunities for both companies and their shareholders.”

The company said it would the spin off will allow both companies to allocate capital and deploy resources in a more focused way, and to become more nimble and better able to capitalize on market opportunities.

James C. Thyen, president and chief executive said, “We ... believe strongly that it is the correct strategic decision at this time for these reasons."

Both executives plan to retire once the separation is complete. Thyen will be replaced by Donald D. Charron, currently president of Kimball Electronics, who will also become chairman, and chief financial officer Robert F. Schneider, will become chairman and chief executive of Kimball International.

Kimball Electronics, which concentrates on the automotive, medical, industrial and public safety markets, is expected to have annualized revenue of approximately $700 million on a pro forma basis once the deal is complete.

 

Last Updated on Tuesday, 21 January 2014 21:49
 

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