Jason Sandefur

PennEngineering & Manufacturing Corp. signed an agreement to be purchased for about $330 million in cash by PEM Holding Co., an affiliate of Tinicum Capital Partners II.\
Under the arrangement, stockholders will receive $18.25 per share for the Danboro, PA-based fastener manufacturer. The transaction is expected to close in the first half of 2005.
CEO Kenneth Swanstrom could see a windfall from the sale. According to Securities and Exchange Commission filings, Swanstrom owns 24% of the company”s outstanding class A common stock. Based on the current agreement, Swanstrom could make as much as $87 million from the deal.
The Boards of Directors for PennEngineering and PEM Holding Co. have unanimously approved the transaction.
Tinicum Capital Partners II, L.P., is a New York-based private investment partnership with over $600 million in committed equity capital.
The announcement follows months of industry speculation that PennEngineering would be sold. After disappointing sales in 2002, PennEngineering bounced back in 2003 with 26.5% improvement to $190.7 million in revenues. During the first quarter of 2004 the company reported a 986% jump in overall profit to $5.87 million.
PennEngineering has found production success in its fastener division by converting operations to an innovative mini-factory approach that promotes teamwork among employees and rewards collective initiative. �2005 FastenerNews.com