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): January 28, 2008

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 January 28, 2008, Crane Co. announced its results of operations for the quarter ended December 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 5 – CORPORATE GOVERNANCE AND MANAGEMENT

Item 5.03(a) Amendment to By-laws.

On January 28, 2008, the Board of Directors of Crane Co. voted to amend Article V (“Capital Stock”) of the Company’s By-laws to permit the Company to issue shares of its common stock in uncertificated form, and to provide for suitable procedures regarding the issuance, transfer and cancellation of uncertificated shares.

A copy of the text of the amendments is attached to this Current Report on Form 8-K as Exhibit 3.1. Pursuant to the rules of the Securities and Exchange Commission, the complete text of the By-laws as amended will be filed as an exhibit to the Company’s next periodic report, the 2007 Annual Report on Form 10-K.

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.

Asbestos Liability

Information Regarding Claims and Costs in the Tort System

As of December 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:

(In millions)	Year Ended December 31,
	2007		2006		2005
Beginning claims	85,941		89,017		84,977
New claims	3,417		4,853		7,986
Settlements	(1,441	)	(1,043	)	(1,829	)
Dismissals	(6,918	)	(6,886	)	(2,117	)
Ending claims*	80,999		85,941		89,017

* Does not include 36,332 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 80,999 pending claims as of December 31, 2007, approximately 25,000 claims were pending in New York, approximately 24,000 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.

Substantially all of the claims the Company resolves are concluded through settlements. The Company recently 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 years ended December 31, 2007, 2006 and 2005 totaled $87.5 million, $69.1 million and $45.1 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. The Company’s pre-tax cash payments for settlement and defense costs, including payments from insurers, in the years ended December 31, 2007, 2006 and 2005 totaled a $10.2 million net payment in 2007 (reflecting the receipt of $31.5 million in previously escrowed funds from Equitas Limited (“Equitas”) in January 2007 and the receipt of $10.0 million for a full policy buyout from Employers Reinsurance Company (“ERC”) in April 2007), a $40.6 million net payment in 2006 and a $45.3 million net payment in 2005, respectively. Detailed below are the comparable amounts for the periods indicated.

(In millions)	Year Ended December 31,							Cumulative to Date through Dec. 31, 2007
	2007		2006		2005
Settlement costs incurred (1)	$	41.6	$	26.3	$	17.4		$	124.1
Defense costs incurred (1)		45.9		42.8		27.7			162.4
Total costs incurred	$	87.5	$	69.1	$	45.1		$	286.5
Pre-tax cash payments (receipts) (2)	$	10.2	$	40.6	$	45.3		$	135.9
(Refund) associated with terminated MSA					$	(9.9	)	$	0.1

(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 and a $10.0 million payment from ERC in April 2007. The cumulative 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.

Effects on the Consolidated Financial Statements

The Company has retained the firm of Hamilton, Rabinovitz & Associates, 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 reviews 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 is based largely on the Company’s experience during the two full preceding calendar years (and additional quarterly periods to the estimate date) for claims filed, settled and dismissed. The Company’s experience is then compared to the results of previously conducted epidemiological studies estimating the number of individuals 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 asbestos. Using that information, HR&A estimates the number of future claims that would be filed against the Company, 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. After discussions with the Company, HR&A augments its liability estimate for the costs of defending asbestos claims in the tort system using a forecast from the Company which is based upon discussions with its defense counsel. Based on this information, HR&A compiles 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 indicated period. Although the methodology used by HR&A will also show claims and costs for subsequent periods (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 the indicated estimate.

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 have 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.

Liability Estimate. With the assistance of HR&A, effective as of September 30, 2007 the Company updated and extended its estimate of the asbestos liability, including the costs of settlement or indemnity payments and defense costs relating to currently pending claims and future claims projected to be filed against the Company through 2017. The Company’s previous estimate was for asbestos claims filed through 2011. As a result of this updated estimate, the Company recorded an additional liability of $586 million as of September 30, 2007. The Company’s decision to take this action at such date was based on several factors. First, the number of asbestos claims being filed against the Company has moderated substantially over the past several years, and in the Company’s opinion, the outlook for asbestos claims expected to be filed and resolved in the forecast period is reasonably stable. Second, these claim trends are particularly true for mesothelioma claims, which although constituting only 11% of the Company’s asbestos claims account for approximately 85% of the Company’s aggregate settlement and defense costs over the past five years. Third, federal legislation that would significantly change the nature of asbestos litigation failed to pass in 2006, and in the Company’s opinion, the prospects for such legislation at the federal level are remote. Fourth, there have been significant actions taken by certain state legislatures and courts over the past several years that have reduced the number and types of claims that can proceed to trial, which has been a significant factor in stabilizing the asbestos claim activity. Fifth, the Company has now entered into coverage-in-place agreements with a majority of its excess insurers, which enables the Company to project a more stable relationship between settlement and defense costs paid by the Company and reimbursements from its insurers. Taking all of these factors into account, the Company believes that it can reasonably estimate the asbestos liability for pending claims and future claims to be filed through 2017. While it is probable 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 2017. Accordingly, no accrual has been recorded for any costs which may be incurred for claims made subsequent to 2017.

Management has made its best estimate of the costs through 2017 based on the analysis by HR&A completed in October 2007. A liability of $1,055 million was recorded as of September 30, 2007 to cover the estimated cost of asbestos claims now pending or subsequently asserted through 2017, of which approximately 68% is attributable to settlement and defense costs for future claims projected to be filed through 2017. The liability is reduced when cash payments are made in respect of settled claims and defense costs. The liability was $1,027 million as of December 31, 2007. 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 a number of years past 2017, due to the significant proportion of future claims included in the estimated asbestos liability and the lag time between the date a claim is filed and when it is resolved.

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.

Insurance Coverage and Receivables. Prior to 2005, a significant portion of the Company’s settlement and defense costs were paid by its primary insurers. With the exhaustion of that primary coverage, the Company began negotiations with its excess insurers to reimburse the Company for a portion of its settlement and defense costs as incurred. To date, the Company has entered into agreements providing for such reimbursements, known as “coverage-in-place”, with eight of its excess insurer groups. With three of its excess insurer groups, the Company entered into policy buyout agreements, settling all asbestos and other coverage obligations for an agreed sum, totaling $46.8 million in aggregate. The Company is in discussions with or expects to enter into additional coverage-in-place agreements with other of its excess insurers whose policies are expected to respond to the aggregate costs included in the updated liability estimate. Under such coverage-in-place agreements, an insurer’s policies remain in force and the insurer undertakes to provide coverage for the Company’s present and future asbestos claims on specified terms and conditions that address, among other things, the share of asbestos claims costs to be paid by the insurer, payment terms, claims handling procedures and the expiration of the insurer’s obligations. 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. All of these agreements include provisions for mutual releases, indemnification of the insurer and, for coverage-in-place, claims handling procedures.

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 for the aggregate liability recorded as of September 30, 2007 to be 33%. An asset of $351 million was recorded as of September 30, 2007 representing the probable insurance reimbursement for such claims. The asset is reduced as reimbursements and other payments from insurers are received. The asset was $340 million as of December 31, 2007.

Uncertainties. Many uncertainties exist surrounding asbestos litigation, and 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.

SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS

Item 9.01. Financial Statements and Exhibits.

(a) None

(b) None

(c) None

(d) Exhibits

  3.1 Amendment to By-laws

99.1 Earnings Press Release dated January 28, 2008, issued by Crane Co.

99.2 Crane Co. Quarterly Financial Data Supplement for the quarter ended December 31, 2007

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: January 28, 2008	By:	/s/ Eric C. Fast
		Eric C. Fast
		President and Chief Executive Officer
		Acting Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
3.1	Amendment to By-laws
99.1	Earnings Press Release dated January 28, 2008, issued by Crane Co.
99.2	Crane Co. Quarterly Financial Data Supplement for the quarter ended December 31, 2007

EX-3.1

Exhibit 3.1

The following is the text of an amendment to the By-laws of Crane Co., effective January 28, 2008. Deleted matter is struck through and new matter in shown in bold face and underlined.

ARTICLE V

Capital Stock

Section 1. Certificates of Stock. Shares of the capital stock of the Corporation may be certificated or uncertificated, as provided under relevant provisions of the Delaware General Corporation Law and resolutions duly adopted by the Board. Any certificates representing shares of stock which may be issued The certificates for shares of the capital stock of the Corporation shall be in such form as shall be approved by the Board. The Any certificates so issued shall be signed by the Chairman or the Vice Chairman of the Board, the President, an Executive Vice President, Senior Vice President or Vice President and also by the Treasurer or the Secretary, and may be sealed with the seal of the Corporation, or a facsimile thereof.

The signatures of the aforesaid officers may be facsimiles if the certificate is countersigned by a transfer agent or registered by a registrar other than the Corporation or its employee. The validity of any stock certificate of the Corporation signed and executed by or in the name of duly qualified officers of the Corporation shall not be affected by the subsequent death, resignation, or the ceasing for any other reason of any such officer to hold such office, whether before or after the date borne by or the actual delivery of such certificate.

The name of the person owning the shares represented thereby, by certificates, with the number of such shares and the date of issue, shall be entered on the Corporation’s capital stock records.

All certificates surrendered to the Corporation shall be cancelled, and no new certificates shall be issued nor shall a record be made regarding the issuance of uncertificated shares until the former certificate for the same number of shares shall have been surrendered and cancelled except in case of a lost or destroyed certificate.

The Corporation may treat the holder of record of any share or shares of stock, whether the shares are issued in certificated or uncertificated form, as the holder in fact thereof, and shall not be bound to recognize any equitable or other claim to interest in any such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by law.

Section 2. Lost, Stolen or Destroyed Certificates. The Corporation may issue a new certificate for shares, or record the issuance of uncertificated shares, in place of a certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Board may require the owner of the lost or destroyed certificate, or his legal representative, to give the Corporation a bond in form satisfactory to the Corporation sufficient to indemnify the Corporation, its transfer agents and registrars against any claim that may be made against them on account of the alleged lost or destroyed certificate or the issuance of such a new certificate or the recording of the issuance of uncertificated shares.

Section 3. Transfer of Shares. The Board, at its option, may appoint a transfer agent and registrar, or one or more transfer agents and one or more registrars, or either, for the stock of the Corporation. Shares of stock of the Corporation shall be transferable in the manner prescribed by applicable law and these By-laws. Subject to any restrictions on transfer imposed at the time of issuance, as such restrictions may be modified by the Board or to comply with applicable law, uncertificated shares shall be transferable upon proper instructions from the holder or a duly authorized attorney, and certificated shares Shares of the capital stock of the Corporation shall be transferable by the owner thereof in person or by duly authorized attorney, upon surrender of the certificates therefor properly endorsed, in each case with such proof of the authenticity of signature as the Corporation or its transfer agent may reasonably require. Any transfer effected in accordance with these By-laws shall be so reflected on the books of the Corporation. The Board, at its option, may appoint a transfer agent and registrar, or one or more transfer agents and one or more registrars, or either, for the stock of the Corporation.

Section 4. Regulations. The Board shall have power and authority to make all such rules and regulations as they may deem expedient concerning the issue, transfer and registration of certificates for shares of the capital stock of the Corporation or the issue, transfer and registration of any such shares in uncertificated form.

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 FOURTH QUARTER AND FULL-YEAR RESULTS;

PROVIDES 2008 EPS GUIDANCE OF $3.45 TO $3.60

STAMFORD, CONNECTICUT – January 28, 2008 – Crane Co. (NYSE: CR), a diversified manufacturer of highly engineered industrial products, today reported fourth quarter 2007 net income was $45.2 million, or $0.74 per diluted share. Excluding special items, net income was $47.3 million, or $0.77 per diluted share, compared to $38.0 million, or $0.61 per diluted share in the fourth quarter of 2006. Fourth quarter 2007 operating profit was $64.8 million. Excluding special items, operating profit in the fourth quarter of 2007 was $64.6 million, an increase of $11.1 million, or 21%, from $53.5 million in the 2006 fourth quarter. Fourth quarter 2007 sales increased $84.3 million, or 15%, including core business growth of $43.2 million (8%), sales from acquired businesses (net of divestitures) of $16.3 million (3%) and favorable foreign currency translation of $24.8 million (4%). The special items for the quarter and full year are detailed in the accompanying non-GAAP table.

For the full year 2007, the Company reported a net loss of $62.3 million, or $1.04 per share, which included a previously disclosed $254 million after-tax provision, or $4.22 per share, to extend its asbestos liability to 2017. Net income in 2006 was $165.9 million, or $2.67 per diluted share.

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Excluding special items in 2007 and 2006, 2007 net income was $195.1 million, or $3.19 per diluted share, compared to $160.9 million, or $2.59 per diluted share in 2006. Sales for 2007 rose to $2.6 billion, an increase of 16% over 2006.

“In the fourth quarter, our operating profit grew 21% and operating margin improved by 50 basis points. Strong performance in our Fluid Handling and Merchandising Systems businesses, along with a lower than expected tax rate, more than offset higher engineering investment in our Aerospace & Electronics segment,” said Crane Co. President and Chief Executive Officer, Eric C. Fast. “We made significant progress in 2007, with full-year sales growing 16% and an even stronger increase in operating profit before special items. We enter 2008 with a record $283 million of cash, substantially strengthened businesses and see opportunities to continue our growth initiatives.”

Special Items Included in Fourth Quarter 2007 Results

Fourth quarter 2007 net income of $45.2 million and $0.74 per share includes a net after-tax gain of $18.4 million ($0.30 per share) related to the previously disclosed consolidation of the Company’s remaining foundry operations in the UK and Canada and an after-tax gain of $5.8 million ($0.10 per share) associated with the sale of the Company’s share of the Industrial Motion Control, LLC joint venture. These gains were substantially offset by 1) an after-tax charge of $12.3 million ($0.20 per share) related to an increase in the Company’s expected liability at its Goodyear, AZ Superfund site, 2) the $3.6 million ($0.06 per share) residual tax effect related to the impact of the third quarter 2007 asbestos charge on the Company’s effective tax rate for the remainder of 2007, and 3) a tax provision of $10.4 million ($0.17 per share) related to the Company’s recent determination of a potential repatriation of approximately $194 million of foreign cash balances. Excluding these items, fourth quarter 2007 net income was $47.3 million or $0.77 per diluted share. Please see the attached schedule of Non-GAAP Financial Measures for details.

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The tax rate in the fourth quarter 2007 was 32.2%, primarily reflecting lower than expected foreign taxes offset partially by the net cost of the special items discussed above. The 2006 fourth quarter tax rate of 26.7% reflected the favorable impact of the reinstatement of the federal research and development tax credit.

Order backlog at December 31, 2007 totaled $720 million, 6% higher (5% higher excluding acquisitions) than the backlog of $677 million at December 31, 2006.

Cash Flow and Financial Position

Cash provided by operating activities was $86.5 million in the fourth quarter of 2007, compared to $78.8 million in 2006. Net debt to net capitalization was 11.5% at December 31, 2007, compared to 22.2% at December 31, 2006. In the fourth quarter of 2007, the Company did not repurchase any shares of its common stock. (Please also see the attached Condensed Statement of Cash Flows and Non-GAAP Financial Measures.)

Segment Results

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

Aerospace & Electronics

	Fourth Quarter						Change
(dollars in millions)	2007			2006
Sales	$	161.3		$	145.9		$	15.4		11	%
Operating Profit	$	17.7		$	25.8		$	(8.1	)	(31	)%
Profit Margin		11.0	%		17.7	%

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The fourth quarter 2007 sales increase of $15.4 million reflected a sales increase of $8.3 million in the Aerospace Group and an increase of $7.1 million in the Electronics Group. Segment operating profit declined by $8.1 million as a result of higher engineering expenses of $10.4 million which were primarily related to products for the Boeing 787 program.

Aerospace & Electronics segment backlog at the end of the fourth quarter was $393 million, slightly lower than the prior year because aerospace customers are now ordering more frequently and in smaller quantities.

Engineered Materials

	Fourth Quarter						Change
(dollars in millions)	2007			2006
Sales	$	74.8		$	69.3		$	5.5		8	%
Operating Profit	$	8.6		$	11.7		$	(3.1	)	(26	)%
Profit Margin		11.5	%		16.9	%

The fourth quarter 2007 sales increase of $5.5 million reflects $9.9 million of sales related to the September 2007 acquisition of the composite panel business of Owens Corning, partially offset by lower volumes to the Company’s traditional recreational vehicle and transportation customers. Operating profit in 2007 decreased 26% primarily reflecting lower core business sales and higher raw material costs.

Merchandising Systems

	Fourth Quarter						Change
(dollars in millions)	2007			2006
Sales	$	91.8		$	78.3		$	13.5	17	%
Operating Profit	$	8.4		$	0.4		$	8.0	nm
Profit Margin		9.1	%		0.5	%

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Strong organic sales growth of 17% was driven by increased sales in Vending Solutions, particularly in Europe, and continued strong global demand for Payment Solutions. Both the Vending and Payment Solutions businesses contributed to the strong increase in operating profit, reflecting continued improvement in the businesses acquired in 2006.

Fluid Handling

	Fourth Quarter						Change
(dollars in millions)	2007			2006
Sales	$	300.9		$	255.3		$	45.6	18	%
Operating Profit before Foundry Restructuring	$	38.2		$	22.8		$	15.4	68	%
Profit Margin before Foundry Restructuring		12.7	%		8.9	%
Gain on Foundry Restructuring	$	19.1			—		$	19.1	—
Operating Profit	$	57.3		$	22.8		$	34.5	151	%
Profit Margin		19.0	%		8.9	%

Fourth quarter 2007 sales increased $45.6 million, or 18%, including $28.8 million (11%) of core sales and favorable foreign currency translation of $18.3 million (7%), partially offset by lower sales from a divested business of $1.5 million. Based on strong sales growth from the global chemical / pharmaceutical and energy industries, and generally higher demand from many commercial applications, operating profit before the restructuring gain increased $15.4 million, or 68%, and margins increased to 12.7%.

In December 2007, the Fluid Handling segment recorded a net gain of $19.1 million ($18.4 million after-tax) related to the consolidation of foundry operations located in the UK and Canada,

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as it continues to transition to more low cost country sourcing as part of its plan to further improve margins to 15%. The net gain reflects the profit on the sale of the Company’s operating facility in Ipswich, England, partially offset by foundry workforce reduction expenses associated with the restructuring program. The Company will lease back part of the Ipswich property for up to two years until the ongoing manufacturing and office activities are transferred to new premises.

The Fluid Handling segment backlog was $243 million at December 31, 2007, 15% higher than $211 million at December 31, 2006, reflecting continued strong global demand.

Controls

	Fourth Quarter						Change
(dollars in millions)	2007			2006
Sales	$	37.1		$	32.9		$	4.2		12.9	%
Operating Profit	$	1.6		$	2.7		$	(1.1	)	(41.8	)%
Profit Margin		4.2	%		8.2	%

The fourth quarter 2007 sales increase of $4.2 million reflects $3.5 million of sales related to the August 2007 acquisition of the Mobile Rugged Business division of Kontron America, Inc. Operating profit in 2007 decreased primarily due to integration expenses and intangible amortization related to the acquisition.

Full Year 2008 Guidance

The Company continues to see strong demand in Fluid Handling, which represents approximately 43% of sales, and expects demand to remain robust in its long-cycle Aerospace & Electronics segment. Both Merchandising Systems and Engineered Materials have been materially strengthened from acquisitions and with their industry-leading positions are expected to continue to execute on key growth initiatives. The Company forecasts diluted earnings per share will increase to $3.45 – $3.60 in 2008, a record year for the Company. This guidance includes an estimated annual tax rate

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of approximately 31%. The Company notes that its earnings growth will be lower in the first half of 2008, reflecting continued elevated levels of engineering spending for several Boeing 787 new product programs.

Management expects cash flow provided from operating activities before asbestos in 2008 will be approximately $275 million, asbestos related payments net of insurance will be approximately $55 million, capital expenditures will be approximately $50 million and free cash flow will be $170 million. The 2008 estimated EBITDA will be $411 – $425 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 fourth quarter and full year financial results on Tuesday, January 29, 2008 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

7

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)

2008 – 1

8

EX-99.2

Exhibit 99.2

CRANE CO.

Income Statement Data

(in thousands, except per share data)

	Three Months Ended December 31,				Twelve Months Ended December 31,
	2007		2006		2007		2006
Net Sales:
Aerospace & Electronics	$	161,296	$	145,892	$	628,859	$	566,372
Engineered Materials		74,850		69,328		331,030		309,258
Merchandising Systems		91,838		78,253		388,227		257,818
Fluid Handling		300,860		255,302		1,135,843		999,413
Controls		37,119		32,877		135,212		124,028
Total Net Sales	$	665,963	$	581,652	$	2,619,171	$	2,256,889
Operating Profit (Loss):
Aerospace & Electronics	$	17,695	$	25,767	$	86,176	$	99,181
Engineered Materials		8,626		11,700		58,339		50,252
Merchandising Systems		8,386		428		39,684		17,529
Fluid Handling		38,154		22,780		140,168		107,377
Foundry Restructuring		19,083		—		19,083		—
Total Fluid Handling		57,237		22,780		159,251		107,377
Controls		1,570		2,699		9,901		10,052
Corporate		(9,837)		(9,909)		(51,945)		(36,455)
Environmental Provision		(18,912)		—		(18,912)		—
Asbestos Provision		—		—		(390,150)		—
Total Operating Profit (Loss)		64,765		53,465		(107,656)		247,936
Interest Income		2,422		2,776		6,259		4,939
Interest Expense		(6,790)		(6,748)		(27,404)		(23,015)
Miscellaneous—Net		6,313		2,333		9,906		9,474
Income (Loss) Before Income Taxes		66,710		51,826		(118,895)		239,334
Provision for Income Taxes		21,483		13,844		(56,553)		73,447
Net Income (Loss)	$	45,227	$	37,982	$	(62,342)	$	165,887
Share Data:
Net Income (Loss) per Diluted Share	$	0.74	$	0.61	$	(1.04)	$	2.67
Average Diluted Shares Outstanding		61,221		61,880		60,037		62,103
Average Basic Shares Outstanding		60,093		60,839		60,037		60,906
Supplemental Data:
Cost of Sales—Operations	$	454,597	$	399,657	$	1,776,157	$	1,525,633
Environmental Provision		18,912		—		18,912		—
Asbestos Provision		—		—		390,150		—
Selling, General & Administrative		146,762		128,530		560,681		483,320
Foundry Restructuring		19,083		—		19,083		—
Depreciation and Amortization		16,570		15,229		61,310		54,285
Stock Compensation Expense		4,074		3,595		15,247		14,883

CRANE CO.

Condensed Balance Sheets

(in thousands)

	December 31, 2007		December 31, 2006
ASSETS
Current Assets
Cash and Cash Equivalents	$	283,370	$	138,607
Accounts Receivable		345,176		330,146
Current Insurance Receivable—Asbestos		33,600		52,500
Inventories		327,719		313,259
Other Current Assets		47,757		45,897
Total Current Assets		1,037,622		880,409
Property, Plant and Equipment		292,683		289,555
Long-Term Insurance Receivable—Asbestos		306,557		170,400
Long-Term Deferred Tax Assets		220,370		171,164
Other Assets		253,510		214,220
Goodwill		766,550		704,736
Total Assets	$	2,877,292	$	2,430,484
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Notes Payable and Current Maturities of Long-Term Debt	$	548	$	9,505
Accounts Payable		177,978		161,270
Current Asbestos Liability		84,000		70,000
Accrued Liabilities		230,295		196,723
Income Taxes		731		24,428
Total Current Liabilities		493,552		461,926
Long-Term Debt		398,301		391,760
Deferred Tax Liability		31,880		89,595
Long-Term Asbestos Liability		942,776		459,567
Other Liabilities		125,980		109,033
Shareholders’ Equity		884,803		918,603
Total Liabilities and Shareholders’ Equity	$	2,877,292	$	2,430,484

CRANE CO.

Condensed Statements of Cash Flows

(in thousands)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2007			2006			2007			2006
Operating Activities:
Net income	$	45,227		$	37,982		$	(62,342	)	$	165,887
Asbestos provision		—			—			390,150			—
Environmental provision		18,912			—			18,912			—
Foundry restructuring		(27,838	)		—			(27,838	)		—
Gain on sale of joint venture		(4,144	)		—			(4,144	)		—
Income from joint venture		(1,524	)		(1,116	)		(5,322	)		(5,641	)
Loss/(Gain) on divestitures		—			453			975			(8,478	)
Depreciation and amortization		16,570			15,229			61,310			54,285
Stock-based compensation expense		4,074			3,595			15,247			14,883
Deferred income taxes		27,602			95			(112,641	)		5,049
Cash (used for) provided by operating working capital		32,210			34,782			(7,322	)		(835	)
Other		(7,065	)		(1,635	)		(23,954	)		(2,892	)
Subtotal		104,024			89,385			243,031			222,258
Asbestos related payments, net of insurance recoveries		(17,509	)		(10,606	)		(10,198	)		(40,563	)
Total provided by operating activities		86,515			78,779			232,833			181,695
Investing Activities:
Capital expenditures		(13,757	)		(4,859	)		(47,169	)		(27,171	)
Proceeds from sale of equity investment		32,996			—			32,996			—
Proceeds from disposition of capital assets		36,827			1,786			48,437			5,103
Proceeds from divestitures		—			—			2,005			26,088
Payment for acquisition, net of cash acquired		(332	)		(47,903	)		(65,498	)		(282,637	)
Total used for investing activities		55,734			(50,976	)		(29,229	)		(278,617	)
Financing Activities:
Dividends paid		(10,823	)		(9,131	)		(39,651	)		(33,596	)
Reacquisition of shares on the open market		—			(22,499	)		(50,001	)		(59,998	)
Stock options exercised—net of shares reacquired		4,955			2,264			15,057			22,870
Excess tax benefit from stock-based compensation		2,897			113			6,978			7,688
Issuance of Debt		—			25,087			—			96,377
Net increase / decrease in short-term debt		(24,184	)		9,173			(8,992	)		9,228
Total used for financing activities		(27,155	)		5,007			(76,609	)		42,569
Effect of exchange rate on cash and cash equivalents		6,028			6,720			17,768			12,568
Increase (decrease) in cash and cash equivalents		121,122			39,530			144,763			(41,785	)
Cash and cash equivalents at beginning of period		162,248			99,077			138,607			180,392
Cash and cash equivalents at end of period	$	283,370		$	138,607		$	283,370		$	138,607

CRANE CO.

Order Backlog

(in thousands)

	December 31, 2007		December 31, 2006
Aerospace & Electronics	$	392,822	$	396,799
Engineered Materials		14,802		13,198
Merchandising Systems		34,093		33,170
Fluid Handling		242,591		210,532
Controls		35,273		22,982
Total Backlog	$	719,581	$	676,681

CRANE CO.

Non-GAAP Financial Measures

(in thousands, except for per share amounts)

	Three Months Ended December 31,						Twelve Months Ended December 31,						Percent Change Three and Twelve Months Ended December 31,
	2007			2006			2007			2006			2007		2007
INCOME ITEMS
Net Sales	$	665,963		$	581,652		$	2,619,171		$	2,256,889		14.5	%	16.1	%
Operating Profit (Loss) - GAAP	$	64,765		$	53,465		$	(107,656	)	$	247,936
Special Items impacting Operating Profit:
Asbestos Provision - Pre-Tax (a)		—			—			390,150			—
Environmental Provision (b)		18,912			—			18,912
Environmental Reimbursement (c)											(4,900	)
Foundry Restructuring Gain - Pre-Tax (d)		(19,083	)		—			(19,083	)		—
Government Settlement - Pre-Tax (e)		—			—			7,600			—
Operating Profit before Special Items - Non-GAAP	$	64,594		$	53,465		$	289,923		$	243,036		20.8	%	19.3	%
Percentage of Sales		9.7	%		9.2	%		11.1	%		10.8	%
Net Income (Loss) - GAAP	$	45,227		$	37,982		$	(62,342	)	$	165,887
Per Share	$	0.74		$	0.61		$	(1.04	)	$	2.67
Special Items impacting Net Income:
Asbestos Provision - Net of Tax (a)		3,597			—			253,597			—
Per Share	$	0.06					$	4.22
Environmental Provision - Net of Tax (b)		12,293			—			12,293			—
Per Share	$	0.20					$	0.20
Environmental Reimbursement - Net of Tax (c)											(3,185	)
Per Share										$	(0.05	)
Foundry Restructuring Gain - Net of Tax (d)		(18,402	)		—			(18,402	)		—
Per Share	$	(0.30	)		—		$	(0.31	)
Government Settlement - Net of Tax (e)		—			—			5,396			—
Per Share							$	0.09
Gain on Sale of Partnership Interest - Net of Tax (f)		(5,846	)		—			(5,846	)		—
Per Share	$	(0.10	)				$	(0.10	)
Tax Provision on Undistributed Foreign Earnings (g)		10,400			—			10,400			—
Per Share	$	0.17					$	0.17
Net Gain on Divestitures - Net of Tax (h)		—			—			—			(1,779	)
Per Share										$	(0.03	)
Net Income before Special Items - Non-GAAP	$	47,269		$	37,982		$	195,096		$	160,923		24.5	%	21.2	%
Per Basic Share	$	0.79		$	0.62		$	3.25		$	2.64
Per Diluted Share	$	0.77		$	0.61		$	3.19		$	2.59		25.8	%	23.2	%

In the twelve months ended December 31, 2007, Average Shares Outstanding excluding the effect of diluted stock options were used to compute the per share amounts since this period was in a loss position. Had net income been reported for the period, Average Shares Outstanding would have included the effect of diluted stock options when computing the per share amount (see chart below).

Average Basic Shares Outstanding	60,037
Effect of Diluted Stock Options	1,093
Average Shares Outstanding including the effect of Stock Options	61,130

When considering the effect of dilutive stock options on shares outstanding, Net Income before Special Items is $3.19 per share for the twelve months ended December 31, 2007.

	Three Months Ended December 31,					Twelve Months Ended December 31,						Full Year Guidance 2008
	2007			2006		2007			2006			Low		High
EBITDA (Non-GAAP)
Net Income (Loss)	$	45,227		$	37,982	$	(62,342	)	$	165,887		$	214,500	$	224,000
Non-GAAP Adjustments:
Depreciation and amortization		16,570			15,229		61,310			54,285			69,000		69,000
Amortization of stock based compensation		4,074			3,595		15,247			14,883			15,700		15,700
Asbestos provision - pre-tax (a)		—			—		390,150			—			—		—
Environmental provision (b)		18,912			—		18,912						—		—
Environmental Reimbursement (c)		—			—		—			(4,900	)		—		—
Foundry restructuring gain - pre-tax (d)		(19,083	)		—		(19,083	)		—			—		—
Government settlement - pre-tax (e)		—			—		7,600			—			—		—
Gain on sale of partnership interest - pre-tax (f)		(4,144	)		—		(4,144	)		—			—		—
Interest expense, net		4,368			3,972		21,145			18,076			15,300		15,300
Provision for income taxes		21,483			13,844		(56,553	)		73,447			96,400		100,600
EBITDA	$	87,407		$	74,622	$	372,242		$	321,678		$	410,900	$	424,600

(a) During the three months ended September 30, 2007, the Company recorded an asbestos provision of $390 million. During the three months ended December 31, 2007, the Company recorded a tax expense related to the previously recorded Asbestos Provision recorded in the previous quarter.

(b) During the three months ended December 31, 2007, the Company recorded a charge related to an increase in the Company’s expected liability at its Goodyear, AZ Superfund site.

(c) During the three months ended September 30, 2006, the Company recorded a reimbursement from the US Government for environmental clean-up costs.

(d) During the three months ended December 31, 2007, the Company recorded a net restructuring gain related to the consolidation of its remaining foundry operations in the UK and Canada.

(e) During the three months ended June 30, 2007, the Company recorded a settlement with the US Government, regarding alleged civil violations of the False Claims Act.

(f) During the three months ended December 31, 2007, the Company recorded a gain on the sale of its share of the Industrial Motion Control, LLC joint venture.

(g) During the three months ended December 31, 2007, the Company recorded an income tax provision related to the potential repatriation of foreign cash.

(h) During the three months ended June 30, 2006, the Company recorded a gain of $4.5 million related to the divestiture of two businesses, which was offset by a $2.7 million charge related to the sale of unused property resulting from prior plant consolidations and certain legal costs associated with previous divestitures.

CRANE CO.

Non-GAAP Financial Measures

(in thousands, except for per share amounts)

	December 31, 2007			December 31, 2006
BALANCE SHEET ITEMS
Notes Payable and Current Maturities of Long-Term Debt	$	548		$	9,505
Long-Term Debt		398,301			391,760
Total Debt		398,849			401,265
Less Cash and Cash Equivalents		(283,370	)		(138,607	)
Net Debt		115,479			262,658
Shareholders’ Equity		884,803			918,603
Net Capitalization	$	1,000,282		$	1,181,261
Percentage of Net Debt to Net Capitalization		11.5	%		22.2	%
Shareholders’ Equity	$	884,803		$	918,603
Asbestos Provision, Net of Tax		253,597			—
Shareholders’ Equity before Asbestos Provision, Net of Tax		1,138,400			918,603
Net Debt		115,479			262,658
Net Capitalization before Asbestos Provision, Net of Tax	$	1,253,879		$	1,181,261
Percentage of Net Debt to Net Capitalization before Asbestos
Provision, Net of Tax		9.2	%		22.2	%

	Three Months Ended December 31						Twelve Months Ended December 31						Full Year Guidance 2008
	2007			2006			2007			2006
CASH FLOW ITEMS
Cash Provided from Operating Activities before Asbestos - Related Payments, Net of Insurance	$	104,024		$	89,385		$	243,031		$	222,258		$	275,000
Asbestos Related Payments, Net of Insurance Recoveries		(17,509	)		(10,606	)		(41,698	)		(40,563	)		(55,000	)
Equitas Receipts		—			—			31,500			—			—
Cash Provided from Operating Activities		86,515			78,779			232,833			181,695			220,000
Less: Capital Expenditures		(13,757	)		(4,859	)		(47,169	)		(27,171	)		(50,000	)
Free Cash Flow	$	72,758		$	73,920		$	185,664		$	154,524		$	170,000

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company’s performance. In addition, Free Cash Flow and EBITDA provide supplemental information to assist management and investors in analyzing the Company’s ability to generate positive cash flow. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.