|[February 28, 2013]
Relational Investors LLC and CalSTRS File Comprehensive Presentation Urging Timken to Unlock Shareholder Value by Separating Its Steel and Bearings Businesses Timken's Conglomerate Structure Impairing Shareholder Value
SAN DIEGO --(Business Wire)--
Relational Investors LLC ("Relational") and the California State
Teachers' Retirement System ("CalSTRS"), collectively owners of 7.28% of
The Timken Company, (NYSE: TKR) ("Timken" or "the Company"), today filed
a comprehensive presentation for Timken shareholders entitled "Why a
Separation of Timken's Steel and Bearings Businesses Can Unlock
Significant Shareholder Value." The presentation further demonstrates
the financial and operational logic of CalSTRS' shareholder proxy
proposal, which would enable Timken shareholders to vote for separating
the two businesses. The presentation elaborates on the following points:
There is currently a deep under-valuation of Timken's shares due to
the Company's ill-conceived conglomerate structure, particularly as
compared to its peers.
By separating the steel and bearings businesses, Timken would realize
improved operating performance and the investment community could
appropriately value the earnings profile of each business - thus
unlocking the value of these businesses for shareholders and enhancing
their long-term potential.
Each of Timken management's public excuses to defend the Company's
conglomerate structure are not supported by empirical evidence.
Relational and CalSTRShave expressed their intent to continue a
dialogue with shareholders and the broader investment community about
the value creation potential of the separation of Timken's steel and
bearings businesses. Relational and CalSTRS have expressed their
concerns about the Board's inaction and attempts to ignore the
investment community's clear statements regarding the impediment to
Timken's stock price, the Company's conglomerate structure and the value
creation opportunity to be realized from the separation of Timken's
CalSTRS, with the support of Relational, has filed a formal shareholder
proposal to be voted on at this year's Annual Meeting of Timken
shareholders, recommending that the Company's Board and management act
expeditiously to effectuate a spin-off of Timken's steel business
segment into a separately traded public company. Relational fully
supports CalSTRS proposal and has made such support publicly clear with
Timken's Board and its shareholders.
Below is the link to the presentation: "Why a Separation of Timken's
Bearings and Steel Businesses Can Unlock Significant Shareholder Value".
About Relational Investors LLC:
Relational Investors LLC, founded in 1996, is a privately held,
multi-billion dollar asset management firm and registered investment
adviser. Relational invests in publicly traded companies that it
believes are undervalued in the marketplace. The firm seeks to engage
the management, board of directors, and shareholders of its portfolio
companies in a productive dialogue designed to build a consensus for
positive change to improve shareholder value.
About the California State Teachers Retirement System: The California
State Teachers' Retirement System, with a portfolio valued at $161.4
billion as of January 31, 2013, is the largest educator-only pension
fund in the world. CalSTRS administers a hybrid retirement system,
consisting of traditional defined benefit, cash balance and voluntary
defined contribution plans, as well as disability and survivor benefits.
CalSTRS serves California's 862,000 public school educators and their
families from the state's 1,600 school districts, county offices of
education and community college districts.
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