Fortive Recommends Rejection by Shareholders of the Mini-Tender Offer by TRC Capital Investment Corporation

Rhea-AI Summary

Fortive (NYSE: FTV) warns shareholders about an unsolicited mini-tender offer from TRC Capital Investment to purchase up to 1,500,000 shares (0.44%) of Fortive's outstanding common stock at $75.00 per share. The offer price represents a 4.93% discount to Fortive's closing price on December 6, 2024. Fortive strongly recommends shareholders reject the offer due to the below-market price and numerous conditions attached. The offer expires on January 9, 2025.

Mini-tender offers, targeting less than 5% of shares, bypass many investor protection requirements. TRC has previously made similar offers to Fortive in 2021 and other public companies. The SEC has cautioned investors about such below-market price offers and provided guidance on their website.

Positive

• None.

Negative

• Unsolicited mini-tender offer at 4.93% below market price
• Potential risk to shareholders from reduced investor protections in mini-tender offers
• Repeat attempt by TRC Capital to acquire shares below market value

Insights

Financial Analyst

The attempted mini-tender offer by TRC Capital at $75.00 per share represents a predatory move targeting retail investors. The 4.93% discount to market price is a red flag, as legitimate tender offers typically come at a premium. TRC's history of similar below-market offers to multiple companies reveals a pattern of attempting to exploit uninformed shareholders. The small size of the offer - just 0.44% of outstanding shares - is deliberately structured to avoid SEC regulatory requirements that protect investors in larger tender offers.

The timing of this offer amid Fortive's strong market position suggests opportunistic behavior. Shareholders accepting this offer would be leaving significant value on the table given current market prices. The numerous conditions attached to the offer further reduce its attractiveness and increase execution risk. This type of predatory offer typically targets retail investors who may not closely monitor their investments or understand market dynamics.

Legal Expert

This mini-tender offer raises significant regulatory concerns by deliberately structuring below the 5% threshold to bypass important investor protection requirements under securities laws. The SEC's explicit warnings about such offers highlight the regulatory gap these bidders exploit. The lack of standard disclosure requirements and procedural safeguards puts shareholders at a distinct disadvantage compared to traditional tender offers.

Fortive's response follows best practices by promptly alerting shareholders and providing clear guidance, including specific references to SEC resources. The company's recommendation to withdraw tendered shares and the detailed explanation of the offer's shortcomings demonstrates proper fiduciary duty to shareholders. The multiple conditions in TRC's offer create additional legal complexities and potential risks for accepting shareholders.

EVERETT, Wash.--(BUSINESS WIRE)-- Fortive Corporation (“Fortive”) (NYSE: FTV) has been notified of an unsolicited “mini-tender offer” by TRC Capital Investment Corporation (“TRC”) for TRC to purchase for cash up to 1,500,000 shares, or approximately 0.44%, of the outstanding common stock of Fortive, at a price of $75.00 per share. TRC’s offer price of $75.00 per share represents a 4.93% discount to the closing price per share of Fortive’s common stock on December 6, 2024, the last trading day before the commencement of TRC’s unsolicited mini-tender offer.

Fortive recommends that shareholders reject TRC’s unsolicited offer because, among other reasons, the offer price is below the current market price for shares of Fortive common stock. The offer also is subject to numerous conditions. Fortive also recommends that any shareholders who have tendered shares to TRC withdraw those shares by providing the written notice described in the offering documentation before the expiration of the offer, which is currently scheduled for one minute after 11:59 p.m., New York City Time, on January 9, 2025.

Fortive is not associated with TRC, its mini-tender offer or the mini-tender offer documentation.

TRC made a similar unsolicited mini-tender offer for shares of Fortive in 2021. In addition, TRC has made similar unsolicited mini-tender offers for shares of other public companies. Mini-tender offers are designed to seek less than 5 percent of a company's outstanding shares, thereby avoiding many investor protections, including the disclosure and procedural requirements, applicable to larger tender offers under United States securities laws. The U.S. Securities and Exchange Commission (the “SEC”) has cautioned investors about mini-tender offers, noting that "some bidders make mini-tender offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price." The SEC has also published investor tips regarding these offers on its website at: http://www.sec.gov/investor/pubs/minitend.htm.

Fortive encourages brokers and dealers, as well as other market participants, to review the SEC's letter regarding broker-dealer mini-tender offer dissemination and disclosures on the SEC's website at: http://www.sec.gov/divisions/marketreg/minitenders/sia072401.htm.

Fortive urges investors to obtain current market quotations for shares of Fortive’s common stock, consult with their brokers or financial advisors and exercise caution with respect to TRC's offer.

ABOUT FORTIVE

Fortive is a provider of essential technologies for connected workflow solutions across a range of attractive end-markets. Fortive’s strategic segments - Intelligent Operating Solutions, Precision Technologies, and Advanced Healthcare Solutions - include well-known brands with leading positions in their markets. The company’s businesses design, develop, service, manufacture, and market professional and engineered products, software, and services, building upon leading brand names, innovative technologies, and significant market positions. Fortive is headquartered in Everett, Washington and employs a team of more than 18,000 research and development, manufacturing, sales, distribution, service and administrative employees in more than 50 countries around the world. With a culture rooted in continuous improvement, the core of our company’s operating model is the Fortive Business System. For more information please visit: www.fortive.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241216892796/en/

Elena Rosman

Vice President, Investor Relations

Fortive Corporation

6920 Seaway Boulevard

Everett, WA 98203

Telephone: (425) 446-5000

Source: Fortive Corporation

FAQ

What is the price per share offered in TRC's mini-tender offer for FTV stock?

TRC Capital is offering $75.00 per share, which is 4.93% below Fortive's closing price on December 6, 2024.

How many shares of FTV stock is TRC Capital attempting to purchase?

TRC Capital is attempting to purchase up to 1,500,000 shares, representing approximately 0.44% of Fortive's outstanding common stock.

When does TRC Capital's mini-tender offer for FTV stock expire?

The offer expires one minute after 11:59 p.m., New York City Time, on January 9, 2025.

Has TRC Capital made previous mini-tender offers for FTV stock?

Yes, TRC Capital made a similar unsolicited mini-tender offer for Fortive shares in 2021.

What is Fortive's recommendation regarding TRC's mini-tender offer?

Fortive strongly recommends shareholders reject TRC's unsolicited offer due to the below-market price and numerous conditions attached.