EX-99.1
Exhibit 99.1
NN, Inc. Acquisition of Autocam Corporation
Cautionary Note Regarding Forward-Looking Statements
All statements in these slides, other than statements of historical fact, are “forward-looking statements” that are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on current
expectations, estimates and projections about the industry and markets in which NN and Autocam operate and beliefs of and assumptions made by NN management, involve uncertainties that could significantly affect the financial results of NN or the
combined company. Such forward-looking statements include, but are not limited to, statements about the benefits of the transaction involving NN and Autocam, including future financial and operating results and the combined company’s plans,
objectives, expectations and intentions. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future—including statements relating to creating value for stockholders, benefits
of the transaction to customers and employees of the combined company, integrating our companies, cost savings, synergies, earnings per share, and the expected timetable for completing the proposed transaction—are forward-looking statements.
These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Although we believe the expectations reflected in any forward-looking statements are based on
reasonable assumptions, we can give no assurance that our expectations will be attained and therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. For example, these
forward-looking statements could be affected by factors including, without limitation:
risks associated with
the ability to consummate the merger and the timing of the closing of the merger; the failure to obtain the necessary debt financing arrangements set forth in the commitment letter received in connection with the merger; the interest rate on any
borrowings incurred in connection with the transaction; the impact of the indebtedness incurred to finance the transaction; the ability to successfully integrate our operations and employees; the ability to realize anticipated benefits and synergies
of the transaction; the potential impact of announcement of the transaction or consummation of the transaction on relationships, including with employees, customers and competitors; the outcome of any legal proceedings that have been or may be
instituted against NN following announcement of the transaction; the ability to retain key personnel; the amount of the costs, fees, expenses and charges related to the merger and the actual terms of the financings that will be obtained for the
merger; and changes in financial markets, interest rates and foreign currency exchange rates.
Additional
factors that could cause actual results to differ materially from the forward-looking statements included in this presentation include those additional risks and factors discussed in NN’s periodic reports filed with the SEC. NN does not intend,
and undertakes no obligation, to update any forward-looking statement.
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Overview of Autocam
Autocam is a global leader in
engineering, manufacturing and assembly of extremely close tolerance, highly complex, system critical components for the global automotive markets
The company has four product segments:
Fuel
Systems (“FS”) Powertrain (“PT”) Power Steering (“PS”) Electric Motors (“EM”)
Established in 1988, Autocam employs over 2,100 employees, operates 15 manufacturing facilities in the U.S., Europe, South America and Asia, and expects to generate revenues of ~$250
million in 2014; this amount does not include approximately $42 million of expected sales from 49% owned Chinese joint venture that is accounted for under the equity method
Autocam has developed significant competitive advantages; technical capabilities, processes and systems, skilled program management and product launch capabilities
FY 2013 End Markets
100%
Precision
Metal
Components
FY 2013 Geography
Europe
South America
North America
Asia
16%
58%
19%
7%
As a global leader, Autocam is well-positioned
to benefit from many positive fundamentals in the industry
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Strategic Rationale
Builds out NN’s
Precision Metal Components (PMC) platform to one of the top 3 companies in the world
Establishes global
presence in PMC with well established, profitable operations in Europe, Brazil and
China; Avoids high start-up
greenfield costs and start-up losses
Adds high-growth product platforms (gasoline direct injection, variable
valve timing, electric power steering, multi-speed transmissions) Strong book of business in China Proven, profitable company – no turnaround Significant synergy opportunities Accretive in first full year
Significantly increases NN’s size and market presence Deepens NN’s management talent pool and workforce
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Combined Global Footprint
Marshall ll Plant 2
Autocam Poland Kentwood Plant 1 Marshall Plant 1 NN Netherlands
Autocam France NN Slovakia Kentwood Plant 2
Dowagiac Plant V-S Products Division NN Bosnia Whirlaway Products Division NN Advanced Rubber Products Division NN Italy Autocam (China) Automotive Components Co., Ltd.
NN Precision Plastic Products Division NN,, Inc.
US Ball & Roller Division NN Asia V-S Products Division
Wuxii Weifu Autocam Precision US Ball & Roller Division
Sao Joao Boa Vista Plants 1 and 2
Campinas Locall Corporate Office
Boituva Plant
Acquisition establishes global presence in Precision Metal Components with well established, profitable
operations in North America, Europe, Brazil and China that complement NN’s global bearing business
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NN and Autocam Combination Overview
End Product
Use
Engine Components Fuel Systems
Cooling System
Fans Driveline
Transmission
Fuel Systems Power Steering
Electric Motors
Powertrain Engine Components Steering
Fuel Systems Transmission Product Mix Geography Plastic &
Rubber Components Precision Metal
Components Metal Bearing Components 21% 9% 70% South America 3% Asia 10% 40%
47%
North America
Europe
Precision Metal
Components
100%
Asia
Europe
South America
16%
19%
58%
7%
North America
Plastic & Rubber Components
Metal
Bearing Components
Precision Metal
Components
43%
52%
6%
South America
Asia 7%
10%
North 50% America
31%
Europe
Improved balance among geographic focus
and product mix
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NN and Autocam Combination Overview
Nexteer
Timken Brose
Hitachi TRW
Iljin Cummins
2% 1%
GKN 3% Continental 3%
3% HILITE 3%
3% 3%
4% Bosch
HILITE 3%
6% Denso Emerson
3% 19% SKF
SKF (Copeland)
4% 22%
Emerson 6% 36%
(Copeland) Delphi 7% Schaeffler/
4%
7% 6% INA/FAG
Schaeffler/ 11% 4%
INA/FAG TRW
ZF
7% 7%
7% 8% Fiat 4% 8%
ZF GM 5%
NTN/SNR Cummins NTN/SNR Bosch
Fiat
Consumer Other
Heavy Truck
Aerospace Medical Commercial Other 3% 2%
<1% <1% Consumer-Other 7%
Vehicles
4%
HVAC 5% 4% 9%
Heavy Truck 5%
General Industrial 15%
General 25%
Industrial 60%
Light Auto 70%
Vehicles
87%
Passenger
Vehicles
Top Ten Customers
End Markets
Diversified customer base with enhanced end market focus
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Synergies and Post-Transaction
Creates a powerful
global leader in Precision Metal Components and improves NN’s business mix
Post-Transaction, NN will be a
top 3 global manufacturer of Metal Bearing and Precision Metal Components
$15-$20M of identified synergies
Establishes a global presence in Precision Metal Components with healthy, well established operations in
Brazil, China and Europe
Enhances high-growth product platforms
Common goal to provide exceptional products, solutions and service to customers more efficiently across multiple regions
Leverage procurement spend of combined company
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Transaction Overview
Combined Company
Consideration
Financing
Financial Benefits
Timing
2015 Revenue of approximately $725 million* 2015 EBITDA of $125—$135 million* 2015 Positive Free Cash Flow of $35 million*
$300 million purchase price $275 million in cash and assumed debt; the remainder in NN Common shares to majority owner,
John Kennedy
$350 million Term Loan B underwritten by BofAML and Keybank NA $100 million ABL Revolver
underwritten by Keybank NA and BofAML
Immediately accretive to earnings and cash flow Synergies of
$15-20 million or more expected
Merger Agreement signed July 18, 2014
Closing expected post-HSR by end of third quarter 2014
* Includes all completed acquisitions, estimated continued European recovery, organic growth and adjacent market growth
per NN’s long-range strategic plan. EBITDA estimate assumes full realization of synergies and full integration of new operations.
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Autocam Recent Historical Data*
Summary Unaudited
Financial Data Years Ending 12/31 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 LTM LTM
($ in millions) 2012 2013 6/30/2013
9/30/2013 12/31/2013 3/31/2014 6/30/2014 3/31/2014 6/30/2014
Net sales $ 181.6 $ 233.5 $ 59.7 $ 59.7 $ 59.1 $
64.3 $ 65.4 $ 242.8 $ 248.5
Cost of products sold (exclusive of depreciation
$ 150.3 $ 187.4 $ 47.9 $ 47.8 $ 45.9 $ 50.9 $ 50.6 $ 192.5 $ 195.2
shown separately below)
Selling, general and administrative $ 12.1 $ 13.6 $ 3.4 $ 3.2 $ 3.4 $ 3.5 $ 3.7 $ 13.5 $ 13.8
Depreciation and amortization $ 13.6 $ 16.6 $ 4.0 $ 4.2 $ 4.5 $ 4.9 $ 5.0 $ 17.6 $ 18.6
Income from operations $ 5.6 $ 15.9 $ 4.4 $ 4.5 $ 5.3 $ 5.0 $ 6.1 $ 19.2 $ 20.9
Interest expense $ 2.0 $ 2.7 $ 0.7 $ 0.7 $ 0.7 $ 0.7 $ 0.7 $ 2.8 $ 2.8
Other expense $ 0.3 $ 0.6 $ 0.2 $ 0.2 $ 0.1 $—$ 0.1 $ 0.5 $ 0.4
Income before income taxes $ 3.3 $ 12.6 $ 3.5 $ 3.6 $ 4.5 $ 4.3 $ 5.3 $ 15.9 $ 17.7
Capital spending $ 36.2 $ 29.8 $ 8.1 $ 7.7 $ 6.4 $ 4.1 $ 6.3 $ 26.3 $ 24.5
* The above information was prepared by NN, Inc. based on unaudited and unreviewed Autocam Corporation internal reports provided to NN, Inc. by Autocam. Autocam Corporation has not
reviewed or endorsed this data as presented above. This data should be considered as forward-looking estimates and as such actual results could differ materially from the data presented herein. Please see the cautionary note regarding
forward-looking statements on slide 2 of this presentation. NN does not intend, and undertakes no obligation, to update this information.
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Autocam Recent Historical Data*
EBITDA
Calculation Years Ending 12/31 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 LTM LTM
($ in millions) 2012 2013 6/30/2013
9/30/2013 12/31/2013 3/31/2014 6/30/2014 3/31/2014 6/30/2014
Income before income taxes
$ 3.3 $ 12.6 $ 3.5 $ 3.6 $ 4.5 $ 4.3 $ 5.3 $ 15.9 $ 17.7
Depreciation and amortization
$ 13.6 $ 16.6 $ 4.0 $ 4.2 $ 4.5 $ 4.9 $ 5.0 $ 17.6 $ 18.6
Interest expense
$ 2.0 $ 2.7 $ 0.7 $ 0.7 $ 0.7 $
0.7 $ 0.7 $ 2.8 $ 2.8
China JV dividends received
$ 1.8 $ 1.5 $—$ 1.5 $—$—$—$ 1.5 $ 1.5
Divestiture costs
$—$—$—$—$—$—$ 0.2 $—$ 0.2
Other excludable losses (gains)
$ 0.5 $ 0.7 $ 0.1
$ 0.3 $ 0.1 $—$ 0.2 $ 0.5 $ 0.6
Adjusted EBITDA
$ 21.2 $ 34.1 $ 8.3 $ 10.3 $ 9.8 $ 9.9 $ 11.4 $ 38.3 $ 41.4
* The above information was prepared by NN, Inc. based on unaudited and unreviewed Autocam Corporation internal reports
provided to NN, Inc. by Autocam. Autocam Corporation has not reviewed or endorsed this data as presented above. This data should be considered as forward-looking estimates and as such actual results could differ materially from the data presented
herein. Please see the cautionary note regarding forward-looking statements on slide 2 of this presentation. NN does not intend, and undertakes no obligation, to update this information.
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