Fedders Plans to Sell 50 Million Notes

//August 9, 2005//

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Title: Fedders Plans to Sell $50 Million Notes

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Fedders, the Liberty Corner-based maker of room air conditioners, plans to sell $50 million of notes to replenish funds it used to buy Sanford, North Carolina-based Trion. Fedders is preparing to sell 9.38% senior subordinated notes due 2007 as soon as tomorrow, adding to its existing issue. The notes are expected to yield about 10%. Donaldson, Lufkin & Jenrette Securities is arranging the sale. Last month, Fedders agreed to acquire Trion for $48.6 million in cash and assumed debt. Fedders paid $5.50 for each of Trion”s 7.2 million shares, a 14% premium over Trion”s closing price of $4.81 on July 12. Fedders also assumed about $9 million in debt. Trion, which had sales of $52.7 million in 1998, complements Fedders” seasonal business and its geographic strengths. Its sales and distribution operations in England, Spain and Germany is expected to boost Fedders” presence in Europe, while Fedders” Singapore and China operations will help Trion grow in Asia. Fedders, with 1998 sales of $322.1 million, has targeted Italy, Portugal, Spain and Turkey as hot European markets for air conditioners. Trion”s distribution hubs in those areas will be an asset. While TM Capital advised Fedders, Harris Williams advised Trion. Fedders said it is considering other acquisitions in the indoor air-quality products market, expected to top $3 billion annually.

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