NEW YORK, July 20, 2020 /PRNewswire=KYODO JBN/ --
-- KPS TO PARTICIPATE IN COMPANY'S DIP FINANCING TO SUPPORT OPERATIONS
-- REACHES TENTATIVE AGREEMENT WITH THE UNITED STEELWORKERS OF AMERICA
-- OBTAINS COMMITTED EXIT FINANCING
KPS Capital Partners, LP ("KPS") announced today that, through a newly formed
affiliate, it has entered into an asset purchase agreement with Briggs &
Stratton Corporation (NYSE: BGG) and certain of its wholly-owned subsidiaries
(collectively, "Briggs & Stratton" or the "Company") under which KPS will
acquire substantially all of the assets of Briggs & Stratton, including equity
of foreign subsidiaries, for approximately $550 million.
Briggs & Stratton has filed a motion with the United States Bankruptcy Court
for the Eastern District of Missouri seeking the designation of KPS as the
stalking horse bidder in a sale motion as part of the Company's filing of
voluntary petitions under Chapter 11 of the Bankruptcy Code today. Briggs &
Stratton expects to sell its assets through a court-supervised sale process
under Section 363 of the Bankruptcy Code.
KPS, through an affiliate, has also agreed to invest $265 million in a FILO
tranche of Briggs & Stratton's Debtor in Possession ("DIP") financing to
support the Company's operations. Upon the entry of a final order approving
the DIP facility, KPS will have the right to "credit bid" its $265 million
participation in the DIP financing in connection with the proposed acquisition
of Briggs & Stratton. Following court approval, the DIP facility will ensure
that Briggs & Stratton has sufficient liquidity to continue normal operations
and continue to meet its financial obligations during the Chapter 11 process,
including the timely payment of employee wages and benefits, continued
servicing of customer orders and shipments, and other obligations.
KPS also announced that it has entered into an agreement in principle with the
United Steelworkers of America (the "USW") with respect to a new collective
bargaining agreement ("CBA") for Briggs & Stratton hourly employees represented
by the union at the Company's manufacturing facilities in Wisconsin. The new
CBA, an exclusive agreement between KPS and the USW, will become effective upon
completion of the acquisition.
Further, Wells Fargo has agreed to continue to provide floorplan financing to
support Briggs & Stratton's customers under KPS' ownership, and a syndicate of
banks including Wells Fargo, Bank of America, BMO Harris Bank and PNC Business
Credit has committed to provide exit financing to Briggs & Stratton. The financings
are subject to completion of the acquisition and customary closing conditions.
Michael Psaros, Co-Founder and Co-Managing Partner of KPS, said, "We are very
excited to acquire Briggs & Stratton, a legendary brand in American
manufacturing and the leading company in its industry. Briggs & Stratton
enjoys a leading market position, scale, a global manufacturing footprint,
world-class design and engineering capabilities, and a portfolio of
industry-leading products sold under iconic brand names. We intend to
capitalize on the Company's many attractive growth opportunities and to support
its already substantial investment in research and development, technology and
new product development. KPS intends to grow the new Briggs & Stratton
aggressively through strategic acquisitions.
"KPS is committed to the expeditious acquisition of Briggs & Stratton to
provide certainty of outcome and confidence in the new Company's future for all
of its stakeholders, including customers, employees and suppliers. The Company
and its stakeholders will benefit from KPS' demonstrated commitment to
manufacturing excellence, continuous improvement, global network, access to
capital and significant financial resources. The new Briggs & Stratton will be
conservatively capitalized and not encumbered by its predecessor's significant liabilities.
"We thank the United Steelworkers of America for its support of our acquisition
of the Company. "We have expended an enormous amount of effort, resources and
capital on this process to date. We are confident that all of the conditions
necessary to create a new thriving going concern enterprise are in place,"
Mr. Psaros concluded.
Kirkland & Ellis LLP is acting as legal counsel to KPS with respect to the transaction.
About Briggs & Stratton Corporation
Briggs & Stratton Corporation (NYSE: BGG), headquartered in Milwaukee,
Wisconsin, is focused on providing power to get work done and make people's
lives better. Briggs & Stratton is the world's largest producer of gasoline
engines for outdoor power equipment, and is a leading designer, manufacturer
and marketer of power generation, pressure washer, lawn and garden, turf care
and job site products through its Briggs & Stratton(R), Simplicity(R),
Snapper(R), Ferris(R), Vanguard(R), Allmand(R), Billy Goat(R), Murray(R),
Branco(R) and Victa(R) brands. Briggs & Stratton products are designed,
manufactured, marketed and serviced in over 100 countries on six continents.
For additional information, please visit www.basco.com and
About KPS Capital Partners
KPS, through its affiliated management entities, is the manager of the KPS
Special Situations Funds, a family of investment funds with over $11.4 billion
of assets under management (as of March 31, 2020). For over two decades, the
Partners of KPS have worked exclusively to realize significant capital
appreciation by making controlling equity investments in manufacturing and
industrial companies across a diverse array of industries, including basic
materials, branded consumer, healthcare and luxury products, automotive parts,
capital equipment and general manufacturing. KPS creates value for its
investors by working constructively with talented management teams to make
businesses better, and generates investment returns by structurally improving
the strategic position, competitiveness and profitability of its portfolio
companies, rather than primarily relying on financial leverage. The KPS Funds'
portfolio companies have aggregate annual revenues of approximately $8.4
billion, operate 150 manufacturing facilities in 26 countries, and have
approximately 23,000 employees, directly and through joint ventures worldwide.
The KPS investment strategy and portfolio companies are described in detail at
SOURCE: KPS Capital Partners, LP
CONTACT: Business Inquiries: KPS, +1 212.338.5100; or Media Relations: Mark
Semer, +1 917.439.3507; or Daniel Yunger, +1 917.574.8582