Oilgear to be acquired by private equity firm

The Oilgear Company announced August 28 that it has signed a definitive merger agreement to be acquired by Mason Wells Buyout Fund II, Limited Partnership, an affiliate of the Milwaukee-based private equity firm Mason Wells. Under the terms of the merger agreement, each outstanding share of Oilgear's common stock will be converted into the right to receive $15.25 in cash. Oilgear currently has 2,039,034 shares of common stock outstanding. The proposed merger is expected to be completed by the end of 2006, and is subject to approval by Oilgear's shareholders and other customary closing conditions. Oilgear's board of directors unanimously approved the merger agreement, and its directors and executive officers have each indicated they intend to vote in favor of the merger.

"We believe this transaction will greatly benefit our shareholders, employees and customers," said David Zuege, Oilgear's president and chief executive officer. "The challenges of being a public company of our size have made it increasingly difficult for us to achieve our growth potential in today's very competitive global fluid power marketplace. With the financial strength and resources of the Mason Wells team, the company will be able to expand our range of products and continue to provide creative solutions for our customers' fluid power applications."

John Byrnes, executive managing director of Mason Wells, said "We are very excited about our investment in Oilgear. We believe that the strength of Oilgear's product line, and the knowledge and skill of its employees, combined with our equity capital and other resources, will position the company for long-term success."

In addition, it was announced that Richard Armbrust will serve as president of Oilgear upon the closing of the merger. Armbrust has extensive managerial leadership experience, serving for the past 15 years as chief executive officer or division president for a variety of companies including ABB Inc. and Invensys PLC (where, among other things, he had overall management responsibility for its Rexnord operations).

Byrnes said, "We are very happy that Rick is joining Oilgear. His track record of leadership, creative thinking and business success in industrial markets will enhance Oilgear's already strong management team."

The Oilgear Company, a leader in the fluid power industry, provides advanced technology in the design and production of unique fluid power components and electronic controls. The company serves customers in the primary metals, machine tool, automobile, petroleum, construction equipment, chemical, plastic, glass, lumber, rubber and food industries. Its products are sold as individual components or integrated into high-performance applications.