Ferro Corporation Announces Pricing for Tender Offer and Consent Solicitation

July 3, 2008 5:54 PM EDT

CLEVELAND--(BUSINESS WIRE)--

Ferro Corporation (NYSE: FOE) ("the Company"), today announced the tender offer consideration and the total consideration to be paid in connection with the offer to purchase all of its outstanding 9 1/8% Senior Notes due in January 2009 (the "Notes") being conducted pursuant to the terms of and subject to the conditions in the Offer to Purchase and Consent Solicitation Statement and the related Letter of Transmittal, each dated June 20, 2008 (the "Offer to Purchase").

The total consideration for each $1,000 principal amount of Notes (the "Total Consideration"), which will be payable in respect of the Notes that are accepted for payment and that were validly tendered on or prior to 5:00 p.m., New York City time, on July 3, 2008 (the "Consent Payment Deadline"), will be $1,028.96 per $1,000 principal amount of the Notes. The Total Consideration includes a consent payment of $15.00 for each $1,000 principal amount of Notes tendered by each holder of Notes that validly tenders its Notes and delivers consents on or prior to the Consent Payment Deadline if such Notes are accepted for purchase pursuant to the tender offer. The Total Consideration was determined as of 10:00 a.m., New York City time, on July 3, 2008, and is equal to, for each $1,000 principal amount of Notes, the present value, minus accrued interest, on the applicable payment date for the tender of Notes of (i) $1,000 on January 1, 2009 (the "Redemption Date") and (ii) the remaining scheduled interest payments on such Notes after the payment date for the tender of Notes to the Redemption Date. The consideration was determined using a basis of a yield to the Redemption Date equal to the sum of (A) the yield on the 4.75% U.S. Treasury note due December 31, 2008 (the "Reference Treasury Security"), as calculated by Credit Suisse Securities (USA) LLC ("Credit Suisse"), acting as dealer manager, in accordance with standard market practice, based on the bid side price for the Reference Treasury Security on the price determination date, as described in the tender offer documents, plus (B) a fixed spread of 50 basis points.

In addition to the Total Consideration, such tendering holders will receive accrued and unpaid interest up to, but not including, the payment date.

The tender offer will expire at 5:00 p.m., New York City time, on Friday, July 18, 2008, unless further extended or earlier terminated.

The Company has retained Credit Suisse to serve as the dealer manager and solicitation agent for the tender offer and the consent solicitation. Questions regarding the tender offer and the consent solicitation may be directed to 212-325-4951 (collect). Morrow & Co. will serve as the information agent for the tender offer and can be contacted at 800-607-0088.

About Ferro Corporation

Ferro Corporation (http://www.ferro.com) is a leading global supplier of technology-based performance materials for manufacturers. Ferro materials enhance the performance of products in a variety of end markets, including electronics, solar energy, telecommunications, pharmaceuticals, building and renovation, appliances, automotive, household furnishings, and industrial products.

Headquartered in Cleveland, Ohio, the Company has approximately 6,300 employees globally and reported 2007 sales of $2.2 billion.

Cautionary Note on Forward-Looking Statements

Certain statements in this Ferro press release may constitute "forward-looking statements" within the meaning of Federal securities laws. These statements are subject to a variety of uncertainties, unknown risks and other factors concerning the Company's operations and business environment, which are difficult to predict and often beyond the control of the Company. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect the Company's future financial performance, include the following:

    --  Our ability to obtain the financing for and consummate the
        tender offer are subject to increases in interest rates and
        operating costs, general volatility of the capital markets and
        our ability to access the capital markets.

    --  We depend on reliable sources of raw materials, including
        energy, petroleum-based materials, and other supplies, at a
        reasonable cost, but availability of such materials and
        supplies could be interrupted and/or the prices charged for
        them could escalate.

    --  The markets in which we participate are highly competitive and
        subject to intense price competition.

    --  We are striving to improve operating margins through sales
        growth, price increases, productivity gains, and improved
        purchasing techniques, and restructuring activities, but we
        may not be successful in achieving the desired improvements.

    --  Our products are sold into industries where demand is
        unpredictable, cyclical or heavily influenced by consumer
        spending.

    --  The global scope of our operations exposes us to risks related
        to currency conversion rates and changing economic, social and
        political conditions around the world.

    --  We have a growing presence in the Asia-Pacific region where it
        can be difficult for a U.S.-based company to compete lawfully
        with local competitors.

    --  Regulatory authorities in the U.S., European Union and
        elsewhere are taking a much more aggressive approach to
        regulating hazardous materials and those regulations could
        affect our sales and operating profits.

    --  Our operations are subject to operating hazards and, as a
        result, to stringent environmental, health and safety
        regulations and compliance with those regulations could
        require us to make significant investments.

    --  We depend on external financial resources and any interruption
        in access to capital markets or borrowings could adversely
        affect our financial condition.

    --  Interest rates on some of our external borrowings are
        variable, and our borrowing costs could be affected adversely
        by interest rate increases.

    --  Many of our assets are encumbered by liens that have been
        granted to lenders, and those liens affect our flexibility in
        making timely dispositions of property and businesses.

    --  We are subject to a number of restrictive covenants in our
        credit facilities, and those covenants could affect our
        flexibility in funding strategic initiatives.

    --  We have significant deferred tax assets, and our ability to
        utilize these assets will depend on our future performance.

    --  We are a defendant in several lawsuits that could have an
        adverse effect on our financial condition and/or financial
        performance, unless they are successfully resolved.

    --  Our businesses depend on a continuous stream of new products,
        and failure to introduce new products could affect our sales
        and profitability.

    --  We are subject to stringent labor and employment laws in
        certain jurisdictions in which we operate and party to various
        collective bargaining arrangements, and our relationship with
        our employees could deteriorate, which could adversely impact
        our operations.

    --  Employee benefit costs, especially post-retirement costs,
        constitute a significant element of our annual expenses, and
        funding these costs could adversely affect our financial
        condition.

    --  Our restructuring initiatives may not provide sufficient cost
        savings to justify their expense.

    --  We are exposed to intangible asset risk.

    --  We have in the past identified material weaknesses in our
        internal controls, and the identification of any material
        weaknesses in the future could affect our ability to ensure
        timely and reliable financial reports.

    --  We are exposed to risks associated with acts of God,
        terrorists and others, as well as fires, explosions, wars,
        riots, accidents, embargoes, natural disasters, strikes and
        other work stoppages, quarantines and other governmental
        actions, and other events or circumstances that are beyond our
        control.

Additional information regarding these risk factors can be found in the Company's Annual Report on Form 10-K for the period ended December 31, 2007 and other filings with the Securities and Exchange Commission.

The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on the Company's business, financial condition and results of operations.

This release contains time-sensitive information that reflects management's best analysis only as of the date of this release. The Company does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.

Source: Ferro Corporation

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