Cap Rock Energy Corporation to Be Acquired By Lindsay Goldberg & Bessemer L.P.
November 07 2005 - 8:47AM
PR Newswire (US)
MIDLAND, Texas, Nov. 7 /PRNewswire-FirstCall/ -- Cap Rock Energy
Corporation (AMEX:RKE) (the "Company" or "Cap Rock") announced
today that it has signed a definitive agreement and plan of share
exchange (the "Agreement") to be acquired by a newly formed entity
owned by Lindsay Goldberg & Bessemer L.P. and its affiliates
("LGB"). Under the Agreement, issued and outstanding shares of
common stock of the Company are to be exchanged for the right to
receive $21.75 per share in cash which, including the assumption of
debt, values the Company at approximately $163 million. Certain of
the Company's shares which are held by certain members of
management will be rolled over into shares of a new parent company
controlled by LGB. Following the transaction, the Company will no
longer have any publicly traded shares. "We are very excited about
the opportunity to invest in Cap Rock," stated Russell Triedman of
LGB. "We see significant opportunity in the utility sector, and we
hope to continue investing in the Company over the next several
years to help build it into a larger, industry-leading diversified
utility." William West, President and CEO designate of the Company,
stated "We couldn't be more pleased to have LGB as a new investor
in the Company. We think they will provide the Company with the
capital it needs to continue delivering safe and reliable service
to its customers, while also giving us the financial capacity to
continue building the Company over the long-term." According to
West, all Cap Rock employees will remain in their current positions
with no change in benefits and retirement plans. The existing Cap
Rock management team will continue to guide the Company on a day to
day basis, with the headquarters remaining in Midland, Texas. "LGB
recognizes that our people are our most important asset," West
said, "and they want to preserve the Company's commitment to
providing superior service at competitive rates." As previously
announced by the Company, Mr. David Pruitt resigned as Chief
Executive Officer of the Company on June 14, 2005, effective
November 12, 2005. Mr. Pruitt's resignation will now become
effective after the shareholder meeting at which the transaction is
considered and, at such time, he will become a consultant to the
Company, serving as Senior Advisor to the board of directors and
management. In addition, upon consummation of the transaction, Mr.
Kevern Joyce, former Chairman of the Board and Chief Executive
Officer of Texas-New Mexico Power Company, and Mr. Coyt Webb,
former COO, President and Director of Southwestern Public Service
Company, will be joining the Company's Board of Directors. The
transaction is subject to shareholder approval of the Agreement,
approval of the transaction by the Public Utility Commission of
Texas and the Federal Energy Regulatory Commission and certain
other conditions. A special committee of the board of directors of
Cap Rock comprised wholly of non- employee directors was formed and
unanimously recommended approval of the transaction. The Company
provides electric distribution services to over 35,000 meters in 28
counties in Texas. Its corporate office is located in Midland,
Texas. LGB is a private equity investment firm based in New York
with over $2 billion of committed capital. It seeks to acquire
well-managed businesses in the U.S. and Western Europe across a
wide range of industries and focuses on building long-term value by
partnering with management teams to actively pursue growth
strategies. Berenson & Company acted as financial advisor to
LGB for this transaction. Houlihan Lokey Howard & Zukin
represented the special committee of the board of directors of the
Company. All statements, other than statements of historical fact
included in this news release, are forward-looking statements as
that term is defined in the Private Securities Litigation Reform
Act of 1995. Any such forward-looking statements involve risks and
uncertainties and actual results, performance or achievements of
the Company may be different from those express or implied in the
forward-looking statements. IMPORTANT INFORMATION Investors and
security holders are urged to read the proxy statement regarding
the transaction referred to in the foregoing information, when it
becomes available, because it will contain important information.
The proxy statement will be filed with the Securities and Exchange
Commission (the "SEC") by the Company. Investors and security
holders may obtain a free copy of the proxy statement (when it
becomes available) and other documents filed by the Company with
the SEC at the SEC's website at http://www.sec.gov/ . In addition,
the proxy statement (when it becomes available) and these other
documents may be obtained free of charge from the Company by
directing a request to Cap Rock Energy Corporation, 500 West Wall
Street, Suite 400, Midland, Texas 79701, Attn: Peg Geer. CERTAIN
INFORMATION CONCERNING PARTICIPANTS Investors may obtain a detailed
list of names, affiliations and interests of participants in the
solicitation of proxies of shareholders to approve the transaction
referred to in the foregoing information from the proxy statement
and other documents filed with the SEC filing under Schedule 14A to
be made by the Company at a future date. DATASOURCE: Cap Rock
Energy Corporation CONTACT: Ronnie Lyon of Cap Rock Energy
Corporation, +1-903-813-0377, or
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