| CIT Group, Inc., The | |||
| Ticker: | CIT | 1211 Avenue of the Americas | |
| Exchange: | New York Stock Exchange | New York, NY 10036 | |
| Industry: | Financial (SIC Code 6159) | (212) 536-1390 | |
| # of Employees: | 2925 | ||
| Type of Shares: | Class A Common Shares | Filing Date: | 9/26/97 | |
| U.S. Shares: | 31,500,000 | Offer Date: | 11/12/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $25.00 - $28.00 | |
| Primary Shares: | 31,500,000 | Offer Price: | $27.00 | |
| Secondary Shares: | 0 | Gross Spread: | $1.35 | |
| Offering Amount: | $834,750,000 | Selling: | $0.81 | |
| Expenses: | - | Reallowance: | $0.10 | |
| Shares Out After: | 157,500,000 |
| Manager | Tier | Phone |
| J.P. Morgan Securities Inc. | Lead Manager | (212) 648-0517 |
| CS First Boston | Co-manager | (212) 325-2000 |
| Goldman, Sachs & Co. | Co-manager | (212) 902-5959 |
| Lehman Brothers Incorporated | Co-manager | (212) 526-8100 |
| Merrill Lynch & Co. | Co-manager | (212) 449-4600 |
| Morgan Stanley Dean Witter Discover & Co. | Co-manager | (212) 761-5900 |
| Salomon Brothers Inc. | Co-manager | (212) 783-2947 |
| UBS Securities Inc. | Co-manager | (212) 821-4510 |
| Issuer's Law Firm: | Schulte, Roth & Zabel |
| Bank's Law Firm: | Davis, Polk & Wardwell |
| Auditor: | KPMG Peat Marwick |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $1,042.00 | $597.40 | $518.60 | Assets: | $19,953.60 |
| Net Income: | $260.10 | $163.80 | $132.00 | Curr Assets: | |
| EPS: | Liabilities: | $17,763.00 | |||
| Prior EPS: | Curr Liabilities: | ||||
| Cash Flow/Oper: | $525.50 | Equity: | $2,190.60 | ||
| Cash Flow/Fin: | $848.60 | Cash: | |||
| Cash Flow/Inv: | -$1,432.50 | ||||
| Business Description |
| The company is a leading diversified finance organization offering secured commercial and consumer financing primarily in the U.S. to smaller, middle-market and larger businesses and to individuals through a nationwide distribution network. The Company commenced operations in 1908 and has developed a broad array of "franchise" strategic business units that focus on specific industries, asset types and markets which are balanced by client, industry and geographic diversification. The Company believes that its strong credit risk management expertise and long-standing commitment to its markets and its customers provide it with a competitive advantage. The Company operates through two business segments: (i) commercial, which is comprised of the Equipment Financing (equipment financing and leasing), Capital Finance (commercial aircraft and rail financing and leasing), Commercial Services (factoring), Business Credit (secured financing to middle-market and larger-sized businesses) and Credit Finance (secured financing to smaller-sized and middle-market businesses) strategic business units, and (ii) consumer, which is comprised of the Consumer Finance (home equity) and Sales Financing (recreation vehicle, manufactured housing and recreational boat financing) strategic business units. These strategic business units offer products and services designed to satisfy the financing needs of specific customers, industries and markets. |
| Competition |
| The Company's markets are highly competitive and are characterized by competitive factors that vary based upon product and geographic region. The Company's competitors include captive and independent finance companies, commercial banks and thrift institutions, industrial banks, leasing companies, manufacturers and vendors. Substantial national financial services networks have been formed by insurance companies and bank holding companies that compete with the Company. On a local level, community banks and smaller independent finance and/or mortgage companies are a competitive force. Some competitors have substantial local market positions. Many of the competitors of the Company are large companies that have substantial capital, technological and marketing resources, and some of these competitors are larger than the Company and may have access to capital at a lower cost than the Company. Also, the Company's competitors include businesses that are not related to bank holding companies and, accordingly, may engage in activities, for example, aircraft rental and servicing, currently prohibited to the Company. Competition has been enhanced in recent years by an improving economy and growing marketplace liquidity. The markets for most of the Company's products are characterized by a large number of competitors. However, with respect to some of the Company's products, competition is more concentrated.The Company competes primarily on the basis of pricing, terms and structure in many of its markets. From time to time, competitors of the Company seek to compete aggressively on the basis of these factors and the Company may lose market share to the extent it is unwilling to match its competitors' pricing, terms and structure in order to maintain its interest margins or to maintain its credit discipline. To the extent that the Company matches competitors' pricing, terms or structure, it may experience lower interest margins and/or increased credit losses. In addition, demand for the Company's products with respect to certain industries, such as the commercial airline industry, will be affected by demand for such industry's services and products and by industry regulations. |
| Business Plan |
| The Company has delivered consistent growth in earnings and assets over the past five years. The Company believes that its financial performance is a product of its core strengths, which include its array of "franchise" businesses, strong credit risk management expertise and long-standing commitment to its markets. The following fundamental operating principles are significant to the Company's past success and the execution of its business strategy in the future: (I) Maintain and build leadership positions in selected markets and industries, focusing on the United States, (ii) Offer a broad selection of collateral-based credit products through multiple channels of distribution, (iii) Preserve "best in class" credit culture, coupled with collateral management expertise, (iv) Maintain a relationship-based approach to customers and business partners, (v) Practice disciplined expense management, on-going efficiency improvement and technology investment, (vi) Maintain access to multiple funding sources with strong debt ratings, (vii) Retain experienced management team with long tenure in the industry and with the Company, (viii) Utilize performance-based incentive systems, (ix) Encourage a corporate culture that emphasizes quality in performance and service to customers, employees and business partners and values service to the community, and (x) Pursue growth through selective acquisitions of businesses and assets. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to acquire from DKB its option to purchase the 20% interest in the company currently owned by CBC Holding Inc., an indirect subsidiary of The Chase Manhattan Corporation and to purchase such interest from CBC Holding. |
| Name of Shareholder | % Owned Before | % Owned After |
| DKB | 80.00% |
| Officer Name | Title | Age |
| Takasuke Kaneko | Deputy President, DKB | 55 |
| Yukiharu Uho | Director and Executive Vice President | 44 |
| Yoshiro Aoki | Director and General Manager, New York Branch, DKB | 51 |
| Joseph M. Leone | Executive Vice President and Chief Financial Officer | 44 |
| Ernest D. Stein | Executive Vice President, General Counsel and Secretary; Senior Vice President, General Counsel and Secretary | 57 |
| William M. O'Grady | Executive Vice President-Administration | 57 |
| Thomas A. Johnson | General Auditor | 51 |
| Keiji Torii | General Manager, International Planning and Coordination Division and International Banking Coordination Division, DKB | 50 |
| Paul N. Roth | Partner, Schulte Roth & Zabel LLP | 58 |
| Albert R. Gamper, Jr. | President & Chief Executive Officer of the Company | 55 |
| Hisao Kobayashi | Senior Advisor, DKB; Chairman of the Board of Directors of the Company | 62 |
| Tohru Tonoike | Senior Executive Vice President of the Company | 47 |
| William J. Taylor | Senior Vice President and Controlloer | 45 |
| Corinne M. Taylor | Senior Vice President and Treasurer | 36 |
| Joseph A.Pollicino | Vice Chairman of the Company and H&Q; LLC; Director | 57 |