FORT LAUDERDALE, Fla., March 7 /PRNewswire-FirstCall/ -- AutoNation, Inc.
(NYSE: AN), America's largest automotive retailer, announced today that it
intends to commence a cash tender offer to purchase up to 50 million shares of
its common stock at a price per share of $23. The number of shares proposed to
be purchased in the offer represents approximately 19% of the Company's
currently outstanding shares. The tender price represents a 10% premium over
the closing price of the Company's common stock on the New York Stock Exchange
of $20.89 per share on March 6, 2006, the last trading day prior to the
announcement.
Mike Jackson, the Company's Chairman and Chief Executive Officer, stated,
"The tender offer for our common stock demonstrates our confidence in the
future of AutoNation. The transaction will allow us to deliver stockholder
value while retaining financial flexibility to take advantage of future
opportunities. We expect the transaction to be accretive to future earnings
in the range of $.08 to $.10 per share on a full year basis."
AutoNation expects to commence the offer by no later than March 10, 2006.
It is presently anticipated that the offer will remain open for a period of at
least 20 business days. Tenders of shares must be made on or prior to the
expiration of the offer and may be withdrawn at any time on or prior to the
expiration of the offer.
The Company expects to pay for the shares purchased in the tender offer
through a combination of debt financing and existing cash. The Company also
intends to seek to repurchase all of its existing 9% senior notes due 2008 in
the aggregate principal amount of
$323.5 million through a concurrent cash tender offer and consent
solicitation.
The stock tender offer will be subject to certain terms and conditions
that will be described in the offer to purchase that will be distributed to
stockholders and filed with the Securities and Exchange Commission, including
that the Company obtains the debt financing on reasonably satisfactory terms
prior to the expiration of the tender offer. Additionally, the Company may
exercise its right to purchase up to an additional 2% of its outstanding
common stock without extending the offer.
On the terms and subject to the conditions of the offer, the Company's
stockholders will have the opportunity to tender some or all of their shares
at a price of $23 per share, net in cash, without interest. Since it is
expected that more than 50 million shares will be tendered, AutoNation will
purchase the shares tendered on a pro rata basis pursuant to certain
procedures specified in the offer to purchase to be mailed to stockholders.
ESL Investments, Inc., which owns 77,061,800 shares, or 29%, of the
Company's common stock, has agreed to tender all of its shares in the offer.
Two of the Company's directors, Edward S. Lampert and William C. Crowley, are
Chief Executive Officer and President and Chief Operating Officer,
respectively, of ESL Investments, Inc. Assuming that most other stockholders
participate in the tender offer, ESL's percentage ownership interest in the
Company would remain substantially unchanged. Mr. Lampert stated, "ESL
expects to maintain a substantial ownership interest in AutoNation. This
transaction should create a more efficient capital structure for the Company."
All of the Company's other directors and executive officers have advised
the Company that they do not intend to tender any of their shares in the
tender offer, except for Michael E. Maroone, the Company's President and Chief
Operating Officer, who has advised the Company that he intends to tender
approximately three million shares of common stock that he owns in the tender
offer. Mr. Maroone beneficially owns a total of approximately six million
shares, including approximately three million vested stock options.
None of the Company, its Board of Directors, the information agent, the
depositary or the dealer managers will make any recommendations to
stockholders as to whether to tender or refrain from tendering their shares
into the offer. Stockholders must decide how many shares they will tender, if
any.
The information agent for the tender offer will be Innisfree M&A
Incorporated. The depositary for the offer will be Computershare Trust Company
of New York. The dealer managers for the tender offer will be J.P. Morgan
Securities Inc. and Banc of America Securities LLC. The offer to purchase,
letter of transmittal and related documents will be mailed to stockholders of
record and also will be made available for distribution to beneficial owners
of the Company's common stock. Stockholders with questions or who would like
additional copies of the offer documents may call the information agent,
Innisfree M&A Incorporated, toll-free at (877) 825-8631. (Banks and brokers
may call collect at (212) 750-5833.)
AutoNation, Inc., headquartered in Fort Lauderdale, Fla., is America's
largest automotive retailer and a component of the Standard and Poor's 500
Index. AutoNation has approximately 27,000 full-time employees and owns and
operates 346 new vehicle franchises in 17 states.
This press release is for informational purposes only and does not
constitute an offer to buy or the solicitation of an offer to sell shares of
AutoNation, Inc. common stock. The offer will be made only pursuant to the
offer to purchase, letter of transmittal and related materials that the
company will shortly be distributing to its stockholders and filing with the
Securities and Exchange Commission. Stockholders and investors should read
carefully the offer to purchase, letter of transmittal and related materials
because they contain important information, including the various terms of,
and conditions to, the offer. Stockholders and investors may obtain a free
copy of the tender offer statement on Schedule TO, the offer to purchase,
letter of transmittal and other documents that the Company will shortly be
filing with the Securities and Exchange Commission at the Commission's website
at http://www.sec.gov or by calling Innisfree M&A Incorporated, the
information agent for the offer, toll-free at (877) 825-8631. Stockholders are
urged to carefully read these materials prior to making any decision with
respect to the offer.
Certain statements and information included in this release constitute
"forward-looking statements" within the meaning of the Federal Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied in such forward-looking statements. Additional discussion
of factors that could cause actual results to differ materially from
management's projections, estimates and expectations is contained in the
Company's SEC filings. The Company undertakes no duty to update its
forward-looking statements, including its long-term growth targets.
SOURCE AutoNation, Inc.
-0- 03/07/2006
/CONTACT: Marc Cannon of AutoNation, Inc., +1-954-769-3146,
[email protected]/
/Company News On-Call: http://www.prnewswire.com/comp/750525.html /
/Photo: http://www.newscom.com/cgi-bin/prnh/20001017/AUTONATIONLOGO /
/Web site: http://corp.autonation.com
http://www.AutoNation.com /
(AN)
CO: AutoNation, Inc.
ST: Florida
IN: AUT REA
SU: TNM
KC
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8597 03/07/2006 08:30 EST http://www.prnewswire.com