Commercial Vehicle Group Acquires Assets of Short Bark Industries, LLC
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NEW ALBANY, Ohio, Dec. 5 -- Commercial Vehicle Group, Inc. (NASDAQ:CVGI) announced today that it has acquired certain assets from Short Bark Industries, LLC ("SBI"), a supplier of seat covers and various cut-and-sew trim products.
In exchange for the commercial vehicle cut-and-sew assets and operations acquired from SBI, CVG paid approximately $3.6 million in cash and has assumed approximately $1.9 million of net liabilities due to third parties and $1.3 million of net liabilities due to CVG.
Included in the transaction are two leased facilities in Tellico Plains and Pikeville, Tennessee, which CVG management will assume responsibility for, effective immediately. The two leased facilities employ approximately 200 associates and are located near CVG's seating operation in Vonore, Tennessee. CVG also has a ninety-day option to assume the shares, assets or operations of SBI's leased facility in Capilla de Guadalupe, Jalisco, Mexico, at no additional purchase price consideration. There are approximately 14 associates employed at the Mexico facility.
Lisa Held Janke, owner and Chief Executive Officer of SBI, will retain Short Bark's military division and continue to focus on the military apparel business.
Jerry Armstrong, President of Commercial Vehicle Group's Global Truck Division, stated, "This acquisition is a great fit with CVG's operations as it provides us with a platform for a cut-and-sew center of excellence and an uninterrupted supply of seat covers and trim materials. SBI, which originated in the highly-competitive textile environment, is skilled at removing waste in the cutting operation and gaining productivity in the sewing process."
CVG estimates the transaction to be neutral to the Company's diluted EPS for the remainder of 2007 and accretive by approximately $0.02 per diluted share for the full year 2008.
"In addition to the strategic and logistical advantages, this transaction provides us with a margin enhancement opportunity," said Chad M. Utrup, Chief Financial Officer of Commercial Vehicle Group. "Because nearly all of the cut-and-sew products from the acquisition will be supplied directly to our existing operations, our top line revenue is not expected to increase; however, we will realize bottom line margin improvement from the profitability and productivity of the operations," added Utrup.
For the period of December 5, 2007 to December 31, 2007, the Company does not expect any change to its previous estimates as a result of the transaction. For the full year 2008, the Company does not anticipate an increase in revenues and expects operating income in the range of $1.3 million and depreciation in the range of $0.2 million as a result of this transaction.
About Commercial Vehicle Group, Inc.
Commercial Vehicle Group is a leading supplier of fully integrated system solutions for the global commercial vehicle market, including the heavy-duty truck market, the construction and agriculture market and the specialty and military transportation markets. The Company's products include suspension seat systems, interior trim systems, such as instrument and door panels, headliners, molded products, cabinetry and floor systems, cab structures and components, mirrors, wiper systems, electronic wiring harness assemblies and controls and switches specifically designed for applications in commercial vehicle cabs. The Company is headquartered in New Albany, OH with operations throughout North America, Europe and Asia. Information about the Company and its products is available on the internet at www.cvgrp.com .
FCMN Contact: sandy.cashell@cvgrp.com
Source: Commercial Vehicle Group, Inc.
CONTACT:
John Hyre
Investor Relations
Commercial Vehicle Group, Inc.
+1-614-289-5157
Web site: www.cvgrp.com/
