Mohawk Industries Completes Acquisition of Dal-Tile

Mohawk Industries announced on March 20, 2002, that it has completed the previously announced acquisition of Dal-Tile International Inc. Under the terms of the agreement, Mohawk paid $11 in cash and 0.2213 of a share of Mohawk common stock for each outstanding share of Dal-Tile common stock. The total value of the acquisition is approximately $1.8 billion, including cash, Mohawk stock, and the assumption of Dal-Tile's debt.

The company stated that the merger creates the largest floorcovering manufacturer and distributor globally. Dal-Tile adds approximately $1 billion in annual sales of ceramic tile and stone products, significantly expanding Mohawk's hard surface offerings. The integration is expected to yield synergistic opportunities across distribution channels and product lines.

"The Dal-Tile merger creates the largest floorcovering manufacturer and distributor in the world," said Jeffrey S. Lorberbaum, President and CEO of Mohawk, in a press release. "Dal-Tile adds approximately $1 billion in annual sales of ceramic tile and stone products, and its over 200 sales service centers offer synergistic opportunities for Mohawk to leverage its existing distribution networks."

Mohawk anticipates realizing significant benefits from the merger in the coming years. The company estimates the transaction will have a minimal impact on earnings in 2002, with slight accretion expected in 2003 and more substantial earnings improvements in subsequent years as merger synergies are refined and Dal-Tile is fully assimilated.