8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 23, 2007

CRANE CO.

(Exact name of registrant as specified in its charter)

	DELAWARE
	(State or other jurisdiction of incorporation)
1-1657		13-1952290
(Commission File Number)		(IRS Employer Identification No.)
100 First Stamford Place, Stamford, CT		06902
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (203) 363-7300

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

INFORMATION TO BE INCLUDED IN THIS REPORT

Section 2 – FINANCIAL INFORMATION

Item 2.02 Results of Operations and Financial Condition.

On April 23, 2007, Crane Co. announced its results of operations for the quarter ended March 31, 2007. Copies of the related press release and quarterly financial data supplement are being furnished as Exhibits 99.1 and 99.2 to this Form 8-K.

The information furnished under Item 2.02 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2, is not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

SECTION 8 – OTHER EVENTS

ITEM 8.01 Other Events

The following information is provided in order to update the discussion in the Company’s previously filed reports with respect to its asbestos liability.

Information Regarding Claims and Costs in the Tort System

As of March 31, 2007, the Company was a defendant in cases filed in various state and federal courts alleging injury or death as a result of exposure to asbestos. Activity related to asbestos claims during the periods indicated was as follows:

	Three Months Ended March 31,				Year Ended December 31,
	2007		2006		2006
Beginning claims	85,941		89,017		89,017
New claims	1,095		1,304		4,853
Settlements	(529	)	(308	)	(1,043	)
Dismissals	(623	)	(849	)	(6,886	)
Ending claims *	85,884		89,164		85,941

* Does not include 36,281 maritime actions that were filed in the United States District Court for the Northern District of Ohio and transferred to the Eastern District of Pennsylvania pursuant to an order by the Federal Judicial Panel on Multi-District Litigation (“MDL”). These claims have been placed on the inactive docket of cases that are administratively dismissed without prejudice in the MDL.

Of the 85,884 pending claims as of March 31, 2007, approximately 25,000 claims were pending in New York, approximately 28,000 claims were pending in Mississippi, approximately 9,000 claims were pending in Texas and approximately 4,000 claims were pending in Ohio, all jurisdictions in which legislation or judicial orders restrict the types of claims that can proceed to trial on the merits.

Since the termination of the comprehensive master settlement agreement (“MSA”) on January 24, 2005, the Company has been resolving claims filed against it in the tort system. The Company has not re-engaged in discussions with representatives of current or future asbestos claimants with respect to such a comprehensive settlement. While the Company believes that federal legislation to establish a trust fund to compensate asbestos claimants is the most appropriate solution to the asbestos litigation problem, there is substantial uncertainty regarding whether this will occur and, if so, when and on what terms. The Company remains committed to exploring all feasible alternatives available to resolve its asbestos liability in a manner consistent with the best interests of the Company’s shareholders.

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Substantially all of the claims the Company resolves are concluded through settlements. The Company tried the Joseph Norris asbestos claim (the “Norris Claim”) to verdict in California, however, and received an adverse jury verdict on September 15, 2006. On October 10, 2006, the court entered judgment on this verdict against the Company in the amount of $2.15 million, together with interest thereon at the rate of 10% per annum until paid. The Company does not believe that the verdict was supported by the evidence. In addition, the Company believes that procedural irregularities prevented an appropriate determination of the Company’s alleged responsibility for plaintiffs’ injuries. The Company’s post-trial motions were denied by order dated December 15, 2006. On January 3, 2007, the Company appealed the judgment; the appeal is pending.

The gross settlement and defense costs incurred (before insurance and tax effects) for the Company in the three-month periods ended March 31, 2007 and 2006 totaled $21.1 million and $15.2 million, respectively. In contrast to the recognition of settlement and defense costs that reflect the current level of activity in the tort system, cash payments and receipts generally lag the tort system activity by several months or more. Cash payments of settlement amounts are not made until all releases and other required documentation are received by the Company, and payments of both settlement amounts and defense costs by insurers are subject to delays due to the transition from the Company’s primary insurers to its excess insurers. The Company’s total pre-tax cash receipts/payments for settlement and defense costs, including payments from insurers, in the three-month periods ended March 31, 2007 and 2006 totaled a $21.2 million net receipt in 2007 (reflecting the receipt of $31.5 million in previously escrowed funds from Equitas Limited (“Equitas”) and a $9.3 million net payment in 2006, respectively. Detailed below are the comparable amounts for the periods indicated.

(in millions)	Three Months Ended March 31,					Year Ended December 31,			Cumulative to Date Through
	2007		2006			2006			March 31, 2007
Settlement costs incurred (1)	$	11.2	$	5.8		$	26.3		$	93.7
Defense costs incurred (1)		9.9		9.4			42.8			126.4
Total costs incurred	$	21.1	$	15.2		$	69.1		$	220.1
Pre-tax cash receipts/(payments) (2)	$	21.2	($	9.3	)	($	40.6	)	($	104.5	)

(1) Before insurance recoveries and tax effects.

(2) Net of payments received from insurers, including a $31.5 million payment from Equitas in January 2007. Amounts include certain legal fees and expenses related to the terminated MSA.

The amounts shown for settlement and defense costs incurred, and cash payments, are not necessarily indicative of future period amounts, which may be higher or lower than those reported.

In 2005, the Company did not receive significant reimbursements from insurers as the Company’s cost sharing agreement with primary insurers was essentially exhausted. The Company has negotiated coverage-in-place and other agreements with several of its excess insurers whose policies provide substantial insurance coverage for asbestos liabilities. Reimbursements from such insurers for past and ongoing settlement and defense costs allocable to their policies have been made as coverage-in-place and other agreements are reached with such insurers.

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On July 22, 2005, the Company entered into an agreement to settle its insurance coverage claims for asbestos and other liabilities against certain underwriters at Lloyd’s of London reinsured by Equitas for a total payment of $33 million. Under the agreement, $1.5 million was paid to the Company in the third quarter of 2005. The balance of $31.5 million was placed into escrow for the payment of future asbestos claims and funds remaining in escrow were paid to the Company on January 4, 2007. The Company’s settlement with Equitas resolves all its claims against pre-1993 policies issued to the Company by certain underwriters at Lloyd’s of London and reinsured by Equitas.

Effective March 1, 2006, the Company entered into two agreements with Hartford Accident and Indemnity Company and certain affiliated companies (“Hartford”) settling all outstanding claims under the Company’s primary policies with Hartford for a final payment of $1.3 million and establishing a coverage-in-place arrangement for asbestos claims under the Company’s excess policies with Hartford, including a payment of $2.6 million for claims billed to Hartford through September 1, 2005. The Company received these payments in March 2006 and April 2006, respectively. The agreements with Hartford also include provisions for mutual releases, indemnification of Hartford and claims handling procedures.

Effective April 10, 2006, the Company and Everest Reinsurance Company and Mt. McKinley Insurance Company (collectively, “Everest”) reached a settlement agreement pursuant to which, among other things, Everest’s insurance coverage obligations for asbestos claims under the three historical Everest policies issued to Crane Co. were released. A $3.8 million cash payment under this settlement agreement was received by the Company on April 21, 2006.

On June 30, 2006, the Company and Fireman’s Fund Insurance Company (“Fireman’s Fund”) entered into an agreement, effective July 3, 2006, establishing a coverage-in-place arrangement for asbestos claims under the Company’s excess policies with Fireman’s Fund, including a payment of $2.3 million for claims billed to Fireman’s Fund through June 26, 2006, which was received by the Company in August 2006. The agreement with Fireman’s Fund also includes provisions for mutual releases, indemnification of Fireman’s Fund and claims handling procedures.

Effective September 7, 2006, the Company entered into a coverage-in-place agreement with Sentry Insurance (“Sentry”), regarding an excess policy issued by Sentry’s predecessor, Dairyland Insurance Company.

Effective December 20, 2006, the Company entered into a coverage-in-place agreement with Employers Insurance of Wausau (and Nationwide Indemnity Company in its capacity as claims administrator for Wausau) (“Wausau”), establishing an arrangement for asbestos claims under the Company’s excess policies with Wausau, and providing for initial payments totaling $2.6 million for claims billed to Wausau through November 30, 2006. This amount has been received by the Company. This agreement includes provisions for mutual releases, indemnification of Wausau and claims handling procedures.

Effective December 22, 2006, the Company and Century Indemnity Company and ACE Property and Casualty Company (collectively “ACE”) entered into an agreement which, among other things, established a coverage-in-place arrangement for asbestos claims under the Company’s excess policies with ACE. This agreement includes provisions for mutual releases, indemnification of ACE and claims handling procedures.

The Company anticipates that one or more additional agreements with other excess insurers, such as coverage-in-place agreements, may be executed in 2007, and the Company believes that the payment terms of such agreements will be consistent with the overall estimated future reimbursement rate of 40%, although the actual reimbursement rate will vary from period to period due to policy terms and certain gaps in coverage as described below.

Effects on the Consolidated Financial Statements

The Company has retained the firm of Hamilton, Rabinovitz & Alschuler, Inc. (“HR&A”), a nationally recognized expert in the field, to assist management in estimating the Company’s asbestos liability in the tort system. HR&A reviewed information provided by the Company concerning claims filed, settled and dismissed, amounts paid in settlements and relevant claim information such as the nature of the asbestos-related disease asserted by the claimant, the jurisdiction where filed and the time lag from filing to disposition of the claim. The methodology used by HR&A to project future asbestos costs was based largely on the Company’s experience during 2005 and 2006 for claims filed, settled and dismissed. The Company’s experience was compared to the results of previously conducted epidemiological studies estimating the number of people likely to develop asbestos-related diseases. Those studies were undertaken in connection with national analyses of the population of workers believed to have been exposed to

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asbestos. Using that information, HR&A estimated the number of future claims that would be filed, as well as the related settlement or indemnity costs that would be incurred to resolve those claims. This methodology has been accepted by numerous courts and is the same methodology that is utilized by the expert who is routinely retained by the asbestos claimants committee in asbestos-related bankruptcies. After discussions with the Company, HR&A assumed that costs of defending asbestos claims in the tort system would increase to $45 million in 2007 and remain at that level (with increases of 4.5% per year for inflation) indexed to the number of estimated pending claims in future years. Based on this information, HR&A compiled an estimate of the Company’s asbestos liability for pending and future claims, based on claim experience over the past two years and covering claims expected to be filed through the year 2011. Although the methodology used by HR&A will also show claims and costs for periods subsequent to 2011 (up to and including the endpoint of the asbestos studies referred to above), management believes that the level of uncertainty is too great to provide for reasonable estimation of the number of future claims, the nature of such claims or the cost to resolve them for years beyond 2011, particularly given the possibility of federal legislation within that time frame.

In the Company’s view, the forecast period used to provide the best estimate for asbestos claims and related liabilities and costs is a judgment based upon a number of trend factors, including the number and type of claims being filed each year, the jurisdictions where such claims are filed and the effect of any legislation or judicial orders in such jurisdictions restricting the types of claims that can proceed to trial on the merits and the likelihood of any comprehensive asbestos legislation at the federal level. In addition, the dynamics of asbestos litigation in the tort system have been significantly affected over the past five to ten years by the substantial number of companies that filed for bankruptcy protection, thereby staying any asbestos claims against them until the conclusion of such proceedings, and the establishment of a number of post-bankruptcy trusts for asbestos claimants, which are estimated to hold $25 billion for payments to current and future claimants. These trend factors have both positive and negative effects on the dynamics of asbestos litigation in the tort system and the related best estimate of the Company’s asbestos liability, and these effects do not move in a linear fashion but rather change over multi-year periods. Accordingly, the Company’s management monitors these trend factors over time and periodically assesses whether an alternative forecast period is appropriate. While it is reasonably possible that the Company will incur additional charges for asbestos liabilities and defense costs in excess of the amounts currently provided, the Company does not believe that any such amount can be reasonably estimated beyond 2011. Accordingly, no accrual has been recorded for any costs which may be incurred for claims made subsequent to 2011.

Management has made its best estimate of the costs through 2011 based on the analysis by HR&A completed in January 2007. A liability of $512.9 million has been recorded to cover the estimated cost of asbestos claims now pending or subsequently asserted through 2011, of which approximately 44% is attributable to settlement and defense costs for future claims projected to be filed through 2011. The liability is reduced when cash payments are made in respect of settled claims and defense costs. It is not possible to forecast when cash payments related to the asbestos liability will be fully expended; however, it is expected such cash payments will continue for many years, due to the significant proportion of future claims included in the estimated asbestos liability. An asset of $185 million has been recorded representing the probable insurance reimbursement for such claims.

Historically, a significant portion of the Company’s settlement and defense costs have been paid by its primary insurers. Following the exhaustion of most of that primary coverage, and in accordance with the settlement agreements discussed above, certain of the Company’s excess insurers have begun reimbursing the Company for a significant portion of its settlement and defense costs. The Company has substantial excess coverage policies in addition to those bound by the settlement agreements described above that are also expected to respond to asbestos claims as settlements and other payments exhaust the underlying policies. The same factors that affect developing estimates of probable settlement and defense costs for asbestos-related liabilities also affect estimates of the probable insurance payments, as do a number of additional factors. These additional factors include the financial viability of the insurance companies, the method by which losses will be allocated to the various insurance policies and the years covered by those policies, how settlement and defense costs will be covered by the insurance policies and interpretation of the effect on coverage of various policy terms and limits and their interrelationships. In addition, the timing and amount of reimbursements will vary because the Company’s insurance coverage for asbestos claims involves multiple insurers, with different policy terms and certain gaps in coverage. In addition to consulting with legal counsel on these insurance matters, the Company retained insurance consultants to assist management in the estimation of probable insurance recoveries based upon the aggregate liability estimate described above and assuming the continued viability of all solvent insurance carriers. After considering the foregoing factors and consulting with legal counsel and such insurance consultants, the Company determined its probable insurance reimbursement rate to be 40%.

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Estimation of the Company’s ultimate exposure for asbestos-related claims is subject to significant uncertainties, as there are multiple variables that can affect the timing, severity and quantity of claims. The Company cautions that its estimated liability is based on assumptions with respect to future claims, settlement and defense costs based on recent experience during the last few years that may not prove reliable as predictors. A significant upward or downward trend in the number of claims filed, depending on the nature of the alleged injury, the jurisdiction where filed and the quality of the product identification, or a significant upward or downward trend in the costs of defending claims, could change the estimated liability, as would any substantial adverse verdict at trial. A legislative solution or a revised structured settlement transaction could also change the estimated liability.

Since many uncertainties exist surrounding asbestos litigation, the Company will continue to evaluate its estimated asbestos-related liability and corresponding estimated insurance reimbursement as well as the underlying assumptions and process used to derive these amounts. These uncertainties may result in the Company incurring future charges or increases to income to adjust the carrying value of recorded liabilities and assets, particularly if the number of claims and settlement and defense costs change significantly or if legislation or another alternative solution is implemented; however, the Company is currently unable to estimate such future changes. Although the resolution of these claims may take many years, the effect on results of operations and financial position in any given period from a revision to these estimates could be material.

Certain Legal Proceedings

On January 21, 2005, five of the Company’s insurers within two corporate insurer groups filed suit in Connecticut state court seeking injunctive relief against the Company and declaratory relief against the Company and dozens of the Company’s other insurers. The suit also sought temporary and permanent injunctive relief restraining the Company from participating in any further settlement discussions with representatives of asbestos plaintiffs or agreeing to any settlement unless the Company permitted the plaintiff insurers to both participate in such discussions and have a meaningful opportunity to consider whether to consent to any proposed settlement, or unless the Company elected to waive coverage under the insurers’ policies. The plaintiffs also sought expedited discovery on, among other things, the Company’s proposed global settlement. At a hearing on February 22, 2005, the Company (i) contested the application for temporary injunctive relief and expedited discovery; (ii) moved to dismiss the count of the Complaint seeking injunctive relief on the grounds that the count was moot insofar as it addressed the proposed global settlement terminated on January 24, 2005 and not appropriate for determination insofar as it sought relief regarding any future negotiations with representatives of asbestos claimants; and (iii) moved to dismiss counts of the Complaint seeking declaratory relief with respect to the proposed global settlement as moot. At the hearing, the Court denied the plaintiff insurers’ application for temporary injunctive relief and expedited discovery. In denying temporary injunctive relief, the Court stated that the plaintiffs could not show irreparable injury and that the plaintiff insurers would have an adequate remedy at law. In light of the Court’s ruling and the Company’s motions to dismiss, the insurer plaintiffs sought and received leave to amend their Complaint to remove certain declaratory relief counts and to remove or restate the remaining allegations.

On April 8, 2005, the insurer plaintiffs filed an Amended Complaint raising five counts against the Company. The Amended Complaint seeks: (i) declaratory relief regarding the Company’s rights to coverage, if any, under the policies; (ii) declaratory relief regarding the Company’s alleged breaches of the policies in connection with an alleged increase in asbestos claim counts; (iii) a declaration of no coverage in connection with allegedly time-barred claims; (iv) declaratory relief against the Company and the other insurer defendants for allocation of damages that may be covered under the insurance policies; and (v) preliminary and permanent injunctive relief. On April 18, 2005, the Company moved to dismiss the claims for injunctive relief on the grounds that the Court had no jurisdiction to consider the claims because they were speculative and unripe. On October 19, 2005, the Court denied the Company’s motion to dismiss, ruling that the injunctive claims were not unripe. Nonetheless, the Court noted that the Company later could seek summary judgment in connection with the injunctive claims if discovery shows them to be without factual basis. Everest Reinsurance Company and Mt. McKinley Insurance Company (collectively, “Everest”) are two of the plaintiffs in the Connecticut state court action. As referenced above, effective April 10, 2006, the Company and Everest reached a settlement agreement pursuant to which, among other things, Everest’s insurance coverage obligations for asbestos claims under the three historical Everest policies issued to Crane Co. were released in exchange for a $3.8 million cash payment, which was received by the Company on April 21, 2006. As also

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referenced above, effective December 22, 2006, the Company and two of the other plaintiffs in the action, Century Indemnity Company and ACE Property and Casualty Company (collectively “ACE”), reached an agreement pursuant to which, among other things, they established a coverage-in-place arrangement for asbestos claims under the Company’s excess policies with ACE. The Company continues to believe it has meritorious defenses to all the counts of the Amended Complaint and cross-claims filed among the other parties, and intends to defend this matter vigorously.

Section 9 – FINANCIAL STATEMENTS AND EXHIBITS

Item 9.01. Financial Statements and Exhibits.

(a)	None
(b)	None
(c)	None
(d)	Exhibits
99.1	Earnings Press Release dated April 23, 2007, issued by Crane Co.
99.2	Crane Co. Quarterly Financial Data Supplement for the quarter ended March 31, 2007

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CRANE CO.
Dated: April 23, 2007	By:	/s/ J. Robert Vipond
		J. Robert Vipond
		Vice President, Finance and Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Earnings Press Release dated April 23, 2007, issued by Crane Co.
99.2	Crane Co. Quarterly Financial Data Supplement for the quarter ended March 31, 2007.

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EX-99.1

Exhibit 99.1

Crane Co.	NEWS
	Contact:
	Richard E. Koch
	Director, Investor Relations
	and Corporate Communications
	203-363-7352
	www.craneco.com

CRANE CO. REPORTS RECORD FIRST QUARTER RESULTS;

EPS INCREASED 16% TO $.71 FROM $.61

First Quarter Highlights (vs. 2006):

• Sales increased 14% to $628 million

• Operating profit increased 20% to $68 million

• Operating profit margin was 10.9%, up from 10.4%

• Earnings per share increased 16% to $.71 per share

STAMFORD, CONNECTICUT – April 23, 2007 - Crane Co. (NYSE: CR), a diversified manufacturer of highly engineered industrial products, reports first quarter 2007 net income was $43.6 million, or $.71 per share, compared with net income of $37.4 million, or $.61 per share, in the first quarter of 2006.

First quarter 2007 sales increased $78.8 million, or 14%, including core business growth of $27.6 million (5%), sales from acquired businesses (CashCode, Dixie-Narco, Automatic Products, Telequip and Noble Composites) of $50.4 million (9%) and favorable foreign currency translation of $12.0 million (2%), reduced by lower sales from businesses divested in 2006 of $11.2 million (2%).

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Order backlog at March 31, 2007 totaled $727 million, 17% higher than the backlog of $622 million at March 31, 2006 and 7% higher than $677 million at December 31, 2006.

“Our record first quarter EPS gives us a strong start toward posting our third consecutive year of record earnings,” said Crane Co. president and chief executive officer, Eric C. Fast. “The first quarter 2007 profit increase was a result of improvement in all our segments, except Aerospace & Electronics, which was modestly lower than 2006. The largest increases in our operating profit came from our Fluid Handling and Merchandising Systems businesses. The five acquisitions we completed in 2006, which were important strategic additions to strengthen our industry leading positions, contributed significantly to our profit improvement.”

Cash Flow and Financial Position

Cash provided by operating activities was $36.9 million in the first quarter of 2007, which included the receipt of the 2005 Equitas asbestos-related insurance settlement payment of $31.5 million, compared with $17.0 million last year. Net debt to total capitalization was 22.6% at March 31, 2007, compared with 22.2% at December 31, 2006. In the first quarter of 2007, the Company repurchased 1,020,870 shares of its common stock on the open market at a cost of $40 million. (Please also see the attached Condensed Statement of Cash Flows and Non-GAAP Financial Measures.)

Segment Results

All comparisons below refer to the first quarter 2007 versus the first quarter 2006, unless otherwise specified.

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Aerospace & Electronics

	First Quarter						Change
(dollars in millions)	2007			2006
Sales	$	148.4		$	139.5		$	8.9		6	%
Operating Profit	$	21.0		$	22.4		($	1.4	)	(6	)%
Profit Margin		14.2	%		16.1	%

The first quarter 2007 sales increase of $8.9 million reflected a sales increase of $10.1 million in the Aerospace Group and a decrease of $1.2 million in the Electronics Group. Segment operating profit declined as a result of a decrease of $1.3 million in the Aerospace Group.

Aerospace Group sales of $99.6 million increased $10.1 million, or 11%, from $89.5 million in the prior year period. Resistoflex Aerospace, which was sold in May 2006, had sales of $4.1 million in the first quarter of 2006. Excluding Resistoflex Aerospace, sales increased $14.2 million or 17% over the first quarter of 2006. The $1.3 million decrease in operating profit resulted from higher engineering spending of $4.6 million largely on programs to be completed in the second half of 2007, and a recall of certain pump connectors as a result of a supplier quality issue, which more than offset the profits associated with higher sales. Backlog at the end of the first quarter of 2007 (excluding Resistoflex) increased 18% over the first quarter of 2006.

Electronics Group sales of $49.0 million decreased $1.2 million, or 2%, due to lower sales in microwave and electronic manufacturing services solutions. Operating profit was equal to the first quarter of 2006. Strong orders in the custom power and micro electronics businesses in the first quarter resulted in Electronics backlog at the end of the first quarter being $13 million, or 9%, higher than the prior year.

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The Aerospace & Electronics segment backlog was $406 million at March 31, 2007 compared with $363 million at March 31, 2006 and $397 million at December 31, 2006.

Engineered Materials

	First Quarter						Change
(dollars in millions)	2007			2006
Sales	$	87.7		$	85.9		$	1.8	2	%
Operating Profit	$	16.0		$	15.7		$	0.3	2	%
Profit Margin		18.3	%		18.3	%

The first quarter 2007 sales were higher than the prior year period as sales of $12.8 million from Noble Composites, acquired in September 2006, more than offset lower volumes to the Company’s traditional recreational vehicle, transportation and building products customers. Operating profit in 2007 increased slightly as the benefit of the Noble acquisition offset reduced operating profit in the base business from lower sales and continued product support costs in the recreational vehicle market.

Merchandising Systems

	First Quarter						Change
(dollars in millions)	2007			2006
Sales	$	97.4		$	52.6		$	44.8	85	%
Operating Profit	$	9.6		$	3.8		$	5.8	153	%
Profit Margin		9.9	%		7.1	%

Merchandising Systems sales increased $44.8 million, or 85%, driven primarily by increased sales of $37.6 million from the CashCode, Telequip, Dixie-Narco, and Automatic Products acquisitions. Operating profit improved by $5.8 million. This strong improvement resulted from leveraging sales growth at CashCode and NRI, and a modest increase in core North American vending.

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Fluid Handling

	First Quarter						Change
(dollars in millions)	2007			2006
Sales	$	263.1		$	242.2		$	20.9	9	%
Operating Profit	$	31.1		$	25.5		$	5.6	22	%
Profit Margin		11.8	%		10.5	%

The first quarter sales increased $20.9 million, or 9%, including $18.8 million (8%) of core sales, favorable foreign currency translation of $9.2 million (4%), partially offset by lower sales from the divestiture of Westad of $7.1 million (3%). Backlog at the end of the first quarter of 2007 (excluding Westad) increased 31% over the first quarter of 2006. Operating profit increased $5.6 million, or 22%, as the sales increase was effectively leveraged with margins improving to 11.8% from 10.5%.

Valve Group sales were $196.5 million in the first quarter of 2007 compared with $173.3 million in the first quarter of 2006, an increase of 13%. Valve Group core sales growth was $20.3 million (12%), favorable currency translation was $10.0 million (5%), partially offset by $7.1 million (4%) of sales of Westad. Core sales improved from increased demand for industrial valves, particularly from the chemical / pharmaceutical and energy industries, and generally higher demand from many commercial applications. Sales growth was effectively leveraged with operating profit increasing 46%, from $16.8 million to $24.5 million. Profit margin of 12.4% increased from 9.6% in the prior year.

Crane Pumps & Systems sales of $24.2 million decreased $3.4 million, or 12%, reflecting generally softer demand in residential building and municipal projects. Profit margin of 9.0%, while improved from the fourth quarter of 2006, was down from 14.9% in the prior year primarily as a result of lower sales.

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Crane Supply sales of $42.4 million increased $1.1 million, or 3%. Core sales growth of $1.8 million was partially offset by $0.7 million of unfavorable foreign currency translation. Profit margin was 10.5% in 2007, slightly below 11.1% in 2006.

The Fluid Handling segment backlog was $237 million at March 31, 2007, compared with $203 million at March 31, 2006 ($181 million excluding Westad) and $211 million at December 31, 2006.

Controls

	First Quarter						Change
(dollars in millions)	2007			2006
Sales	$	31.8		$	29.3		$	2.5	9	%
Operating Profit	$	2.3		$	1.5		$	0.8	53	%
Profit Margin		7.4	%		5.2	%

Sales increased 9% because of higher demand for products in the transportation, oil and gas exploration, gas transmission, and water treatment markets. Operating profit increased 53% reflecting good leverage and cost control.

Second Quarter and Full Year 2007 Guidance

Management expects earnings in the second quarter 2007 to be in the range of $.74 to $.82 per share, compared to $.71 per share in the second quarter 2006. While maintaining its 2007 earnings per share guidance of $2.80 to $2.95, management is more confident in achieving results toward the higher end of the range.

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Management continues to expect free cash flow (cash flow from operations less capital expenditures) in 2007 will be in the range of $175-$190 million. Please see the Non-GAAP Financial Measures table attached to this press release for details. Additional information with respect to the Company’s asbestos liability and related accounting provisions and cash requirements is set forth in the Current Report on Form 8-K filed with a copy of this press release.

Conference Call

Crane Co. has scheduled a conference call to discuss the first quarter’s financial results on Tuesday, April 24th, 2007 at 10:00 A.M. (Eastern). All interested parties may listen to a live webcast of the call at http://www.craneco.com. An archived webcast will also be available to replay this conference call directly from the Company’s website.

Crane Co. is a diversified manufacturer of highly engineered industrial products. Founded in 1855, Crane provides products and solutions to customers in the aerospace, electronics, hydrocarbon processing, petrochemical, chemical, power generation, automated merchandising, transportation and other markets. The Company has five business segments: Aerospace & Electronics, Engineered Materials, Merchandising Systems, Fluid Handling, and Controls. Crane has approximately 12,000 employees in North America, South America, Europe, Asia and Australia. Crane Co. is traded on the New York Stock Exchange (NYSE:CR). For more information, visit www.craneco.com.

This press release may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements present management’s expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. Such factors are detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 and subsequent reports filed with the Securities and Exchange Commission.

(Financial Tables Follow)

2007 – 9

7

EX-99.2

Exhibit 99.2

CRANE CO.

Income Statement Data

(in thousands, except per share data)

	Three Months Ended
	March 31,
	2007			2006
Net Sales:
Aerospace & Electronics	$	148,392		$	139,540
Engineered Materials		87,748			85,949
Merchandising Systems		97,364			52,556
Fluid Handling		263,124			242,179
Controls		31,762			29,329
Intersegment Elimination		(173	)		(170	)
Total Net Sales	$	628,217		$	549,383
Operating Profit:
Aerospace & Electronics	$	21,026		$	22,406
Engineered Materials		16,038			15,740
Merchandising Systems		9,631			3,752
Fluid Handling		31,141			25,478
Controls		2,346			1,540
Corporate		(11,783	)		(11,701	)
Total Operating Profit		68,399			57,215
Interest Income		1,313			708
Interest Expense		(6,868	)		(5,527	)
Miscellaneous- Net		1,813			1,261
Income Before Income Taxes		64,657			53,657
Provision for Income Taxes		21,012			16,258
Net Income	$	43,645		$	37,399
Share Data:
Net Income per Diluted Share	$	0.71		$	0.61
Average Diluted Shares Outstanding		61,207			61,801
Average Basic Shares Outstanding		60,209			60,718
Supplemental Data:
Cost of Sales	$	423,683		$	371,501
Selling, General & Administrative		136,135			120,667
Depreciation and Amortization *		15,576			15,265
Stock Compensation Expense		4,304			4,082

* Amount included within cost of sales and selling, general & administrative costs.

CRANE CO.

Condensed Balance Sheets

(in thousands)

	March 31,		December 31,
	2007		2006
ASSETS
Current Assets
Cash and Cash Equivalents	$	133,921	$	138,607
Accounts Receivable		358,102		330,146
Current Insurance Receivable - Asbestos		21,000		52,500
Inventories		327,623		313,259
Other Current Assets		63,547		45,897
Total Current Assets		904,193		880,409
Property, Plant and Equipment		276,683		289,555
Long-Term Insurance Receivable - Asbestos		164,030		170,400
Other Assets		388,805		385,384
Goodwill		709,246		704,736
Total Assets	$	2,442,957	$	2,430,484
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Notes Payable and Current Maturities of Long-Term Debt	$	11,310	$	9,505
Accounts Payable		172,479		161,270
Current Asbestos Liability		70,000		70,000
Accrued Liabilities		194,551		196,723
Income Taxes		32,436		24,428
Total Current Liabilities		480,776		461,926
Long-Term Debt		392,115		391,760
Deferred Tax Liability		91,822		89,595
Long-Term Asbestos Liability		442,877		459,567
Other Liabilities		112,789		109,033
Shareholders’ Equity		922,578		918,603
Total Liabilities and Shareholders’ Equity	$	2,442,957	$	2,430,484

CRANE CO.

Condensed Statements of Cash Flows

(in thousands)

	Three Months Ended March 31,
	2007			2006
Operating Activities:
Net income	$	43,645		$	37,399
Income from joint venture		(1,017	)		(1,761	)
Depreciation and amortization		15,576			15,265
Stock-based compensation expense		4,304			4,082
Cash used for operating working capital		(25,648	)		(32,899	)
Other		(21,151	)		4,196
Subtotal		15,709			26,282
Asbestos related payments, net of insurance recoveries		21,180			(9,300	)
Total provided by operating activities		36,889			16,982
Investing Activities:
Capital expenditures		(6,963	)		(8,390	)
Proceeds from disposition of capital assets		11,032			1,236
Payment for acquisition, net of cash acquired		(5	)		(85,338	)
Total provided from (used) for investing activities		4,064			(92,492	)
Financing Activities:
Dividends paid		(9,050	)		(7,623	)
Reacquisition of shares on open market		(40,001	)		(12,041	)
Stock options exercised - net of shares reacquired		(387	)		8,396
Excess tax benefit from stock-based compensation		690			1,716
Repayment of debt, net		1,733			(202	)
Total used for financing activities		(47,015	)		(9,754	)
Effect of exchange rate on cash and cash equivalents		1,376			1,373
Decrease in cash and cash equivalents		(4,686	)		(83,891	)
Cash and cash equivalents at beginning of period		138,607			180,392
Cash and cash equivalents at end of period	$	133,921		$	96,501

CRANE CO.

Order Backlog

(in thousands)

	March 31, 2007		December 31, 2006		March 31, 2006
Aerospace & Electronics	$	405,792	$	396,799	$	363,443
Engineered Materials		17,437		13,198		16,972
Merchandising Systems		33,231		33,170		14,838
Fluid Handling		237,144		210,532		202,739
Controls		33,224		22,982		23,578
Total Backlog	$	726,828	$	676,681	$	621,570

CRANE CO.

Non-GAAP Financial Measures

(in thousands)

	March 31, 2007			December 31, 2006
BALANCE SHEET ITEMS
Notes Payable and Current Maturities of Long-Term Debt	$	11,310		$	9,505
Long-Term Debt		392,115			391,760
Total Debt		403,425			401,265
Less Cash and Cash Equivalents		(133,921	)		(138,607	)
Net Debt		269,504			262,658
Shareholders’ Equity		922,578			918,603
Total Capitalization	$	1,192,082		$	1,181,261
Percentage of Net Debt to Total Capitalization		22.6	%		22.2	%

	Three Months Ended March 31,						Year Ended December 31,
	2007			2006			2007			2006
							(Estimated)
CASH FLOW ITEMS
Cash Provided from Operating Activities before Asbestos - Related Payments	$	15,709		$	26,282		$	240,000 - 255,000		$	222,258
Asbestos Related Payments, Net of Insurance Recoveries		(10,320	)		(9,300	)		(51,500	)		(40,563	)
Equitas Receipts		31,500			—			31,500			—
Cash Provided from Operating Activities		36,889			16,982		$	220,000 - 235,000			181,695
Less: Capital Expenditures		(6,963	)		(8,390	)		(45,000	)		(27,171	)
Free Cash Flow	$	29,926		$	8,592		$	175,000 - 190,000		$	154,524

Certain non-GAAP measures have been provided to facilitate comparison with the prior year.

Free cash flow provides supplemental information to assist management and investors in analyzing the Company’s ability to generate positive cash flow. Free cash flow is considered a measure of cash generation and should be considered in addition to, but not as a substitute for, other measures reported in accordance with generally accepted accounting principles and may be inconsistent with similar measures presented by other companies.