Timken Acquires Torrington, Becomes Third-Largest Bearing Manufacturer
Press release (10-30-02)
　

    The board of directors of Timken and Ingersoll-Rand have unanimously
approved the agreement.  Upon completion of the acquisition, Timken will be the world's third largest bearings company with approximately $3.6 billion in
annual revenues, global leadership positions in the needle and tapered roller
bearing and alloy steel industries, and operations on six continents.
    Under terms of the agreement, Ingersoll-Rand will receive $700 million in
cash and $140 million in Timken shares.  The transaction, which is subject to
antitrust clearance, successful completion of debt and equity financing, and
customary closing conditions, is expected to close during the first quarter of
2003.
    The strategic acquisition of Torrington, which had 2001 sales totaling
$1.1 billion, significantly broadens Timken's existing portfolio of automotive
and industrial bearings-based products and service solutions and expands the
global size and scope of Timken's business.  Timken and Torrington each have more than 100 years of operating experience in anti-friction products.
Torrington's cylindrical, spherical, needle roller and ball bearings and
customized engineering solutions provide a strong complement to Timken's
leading tapered roller bearings and alloy steel products.
    Timken expects the acquisition to be accretive to earnings per share by at
least 10 percent in 2003.  Timken expects to achieve annual cost savings of
approximately $80 million to be fully phased in by the end of 2005, with
approximately $20 million realized in the first year.  This is in addition to
the previously announced $80 million in annualized savings Timken expects to
realize by the end of 2002 from its manufacturing strategy launched last year.Timken's senior management has prepared a detailed integration plan and willextend its ongoing restructuring program to generate cost savings at
Torrington and throughout the combined company.  Timken will work to realize
economies of scale, eliminate duplicative costs, achieve operating
efficiencies, and enhance productivity.
    The $700 million cash component of the transaction will be financed
through a new senior credit facility underwritten by Bank of America, Key
Bank, Merrill Lynch & Co. and Morgan Stanley, a public offering of senior
notes, and proceeds from a public offering of 11 million Timken shares. Timken
expects to continue to pay its current quarterly dividend of $0.13 per share
and expects to retain its investment grade credit ratings.  Based on the
current Timken share price, the Timken shares to be received by Ingersoll-Rand
will represent approximately 11 percent fully diluted ownership in the larger
Timken Company.  Ingersoll-Rand has agreed not to sell those shares for
6 months after the transaction closes.
  
       Torrington, with 10,500 employees worldwide, has a network of more than 50
offices and 27 manufacturing plants in North and South America, Europe and
Asia.