THE TIMKEN COMPANY

Pada tahun 2002, Perusahaan Timken sedang mempertimbangkan untuk mengakuisisi

Perusahaan Torrington dari Ingersoll -Rand. Akuisisi ini akan membuat pernyataan yang jelas
kepada pasar tentang komitmen Timken untuk tetap menjadi pemimpin dunia dalam industri
bearing karena akan mengakibatkan kombinasi lebih dari 100 tahun memproduksi bearing
dan pengembangan pengalaman. Karena kedua perusahaan membagi banyak pelanggan yang
sama tetapi memiliki beberapa produk yang sama, pelanggan pasti akan menghargai
kemampuan perwakilan penjualan Timken untuk dapat memenuhi kebutuhan mereka lebih
banyak. Selain itu , Timken berpotensi melakukan penghematan biaya tahunan dari fasilitas
produksi konsolidasi dan proses yang diperkirakan lebih dari $ 80 juta. Jika harga yang harus
dibayar untuk Torrington terlalu tinggi, Ingersoll -Rand, dari pada Timken, akan menangkap
nilai sinergi. Selain itu, mengingat ukuran besar akuisisi, Timken prihatin tentang dampak
pada neraca. Jika Ingersoll -Rand meminta kesepakatan dalam bentuk uang tunai dan jika
Timken mengambil utang baru, peningkatan leverage akan membuat lembaga kredit
menurunkan Peringkat investment Timken.
Industri Bearing
Bearing dari berbagai ukuran dan spesifikasi menempatkan mereka dari pesawat
ulang-alik sampai pada peralatan rumah tangga, mobil, peralatan dokter gigi , sepatu roda,
dan drive komputer disk. Pada tahun 2001, perusahaan AS yang terlibat dalam perusahaan
manufaktur Ball dan roller- bearing mempekerjakan lebih dari 33.000 pekerja.
Industri bearing menghadapi berbagai masalah yang kompleks. Kebijakan yang
mendukung industri baja tidak selalu baik untuk industri bearing, sebagai produsen produk
baja sekunder yang berada di tengah-tengah rantai produksi. Karena bearing adalah
komponen penting dari mesin dan peralatan militer dan sipil, pemerintah federal merupakan
pelanggan utama.
intensitas persaingan di kali mengakibatkan biaya oleh perusahaan AS praktik dumping ilegal
oleh pesaing asing. dinyatakan bersalah atas praktek-praktek tersebut, perusahaan-perusahaan
seringkali berbalik dan baik dibuka atau membeli tanaman di Amerika Serikat untuk pasokan
pelanggan Amerika mereka.
pengiriman bola dan rol bantalan tumbuh terus selama tahun 1990-an, memuncak
pada tahun 1998 di lebih dari $ 5,8 miliar. meskipun tahun 1999 dan 2000 tetap relatif kuat,

nilai pengiriman menurun drastis pada tahun 2001, tenggelam ke $ 5,3 miliar, terendah sejak
1995. alasan termasuk resesi ekonomi, penurunan permintaan otomotif, ang serangan teroris
pada 11 September 2001. ada memiliki pertumbuhan moderat berada di sektor pada tahun
2002, yang dipimpin oleh produksi otomotif, yang telah naik 5% karena insentif penjualan,
termasuk pembiayaan 0%. keseluruhan, permintaan bantalan industri diharapkan untuk
melunakkan karena permintaan otomotif mulai menurun pada akhir tahun 2002 ang
umumnya diperkirakan tetap datar untuk tahun 2003. dengan demikian, industri bantalan
tampaknya berada di palung siklus yang banyak analis memperkirakan lebih pemulihan luas
pada tahun 2003 pertumbuhan sekitar 2% hingga 3%.
Bearings worldwide were doing significantly better. Order had increased globally and
were forecast to grow 6.5% a year though 2005, to $42 billion. With supply levels remaining
high worldwide, prices overall were stable and not expected to rise in 2003. Conversely, price
for imports were expected to increase in 2003. As bearings from china came into the united
states, selling at bellow-market prices, the federal government had levied antidumping duties
of up to 59,3%. Antidumping payments to timken amounted to timken amounted to $50
million in 2002 ($30 million in 2001).
The major industry players inclueded timken, SKF, and NSK, Ltd. Sweden-based
aktiebolegat SKF controlled 20% of the world market in bearings, which was more than
twice the market share held by its closest competitors. In 2002, its sales were $4.8 billion, up
18.8% frorm 2001, and the company employed 39,000 worker. NSK, Ltd., based in Tokyo,
produced bearings for the automotive, information technology, and electronics industries. In
2002, NSKs sales reached $3.62 billion and omployment topped 22,000, spread across 50
subsidiaries wordwide. In 2002, Timken reported a net income of $38.7 millon on sales of
$2.55 billion (Exhibit 1) and assets of $2.75 billion (Exhibit 2) Two-million on sales came
from bearings, and about 20% of its sales were from outside the united states. Timken had
operations in 25 countries and employed nearly 18,000 workers.
The timken company
In 1898, veteran St.louis carriage-maker henry timken patented a design for tapered roller
bearings (bearings enclosed between a pair of concentric rings) to facilitate the motion of
carriage axles. The following year, timken and his sons, william and henry (H. H.), founded
the timken roller bearing Axle company, which was the beginning of what was to become a
global manufacturer of highly engineere bearings, alloy and specialty steel, and related

components. In 1902, the company moved to canton, ohio,to be near the growing steelworks
in pittsburgh, pennsylbvania, and the new automobile factories in buffalo, new york,
cleveland, ohio, and detroit, michigan. In 1908, with the debut of the ford model T, the
Timkens business soared. In 1917, the company began making its own steel for bearing.
Timken stock was sold to the public for the first time in 1992. Word war II created increased
demand for Timkens products, and the company opened several new plants. H. H. Timkens
son, W. Robert Timken, became president in 1960 and chair in 1968. The company continued
to grow dureng the 1960s, when it opened plant in Brazil and France. In 1970, the company
adopted its current name, the Timken Company. W.R. Timken Jr., grandson of the founder,
became chair in 1975.
In 1982, with increasing competition from Europe and Japan, the company suffered
its first loss since the Depression. During the years that followed, Timken engaged in joint
ventures, acquisitions, and investments in the United stated as well as various locations
around the world, including the United Kingdom, Europe, India, China, Africa, and Australia.
In 1999, Timken cut production capacity to 80%, and began to consolidate operations and
restructure into global business units. The company closed plants in Australia, restructured
operations in South Africa

(cutting about 1,700 jobs), and outsourced its European

distribution to a company in France. In early 2001, the company announced that it would lay
off more than 7% of its work force.
Timken business units