CSC ServiceWorks to Acquire Mac-Gray for $524 Million


CSC ServiceWorks, Inc. and Mac-Gray Corporation (NYSE: TUC) today announced that they have entered into a definitive agreement and plan of merger that provides for the merger of Mac-Gray with CSC Fenway, Inc., a wholly-owned subsidiary of Spin Holdco Inc., which is a wholly-owned subsidiary of CSC. Pursuant to the transaction, CSC will acquire all of the outstanding common stock of Mac-Gray for $21.25 per share, payable in cash, which represents a premium of 42% over the Company's closing stock price on October 14, 2013. The aggregate value of the transaction is approximately $524 million, taking into account Mac-Gray's outstanding stock options, restricted stock units and net debt as of June 30, 2013. The transaction has been unanimously approved by the Board of Directors of Mac-Gray.

CSC is a leading provider of multi-family housing and commercial laundry solutions, as well as the industry leader in air vending services at convenience stores and gas stations, with more than one million machines in service. Mac-Gray, founded in 1927, is a leading provider of laundry facilities management services to both multi-family and academic housing sectors. For the year ended December 31, 2012, Mac-Gray had revenue of $322.1 million.

"After a careful and thorough evaluation process, the Mac-Gray board has determined that the all-cash transaction with CSC maximizes value for our shareholders," said Mac-Gray Chairman Thomas E. Bullock. "The Board strongly believes that this transaction achieves that result, providing a significant premium for our shareholders."

"We are excited to bring these two companies together to create a world class operation. Both CSC and Mac-Gray are industry leaders in customer service and technology. Bringing our teams together to share each other's best practices will elevate both companies and enhance our customers' experience," said Bob Doyle, CEO of CSC. "On behalf of CSC and our controlling shareholder, Pamplona Capital Management, we look forward to welcoming the Mac-Gray employees to our team."

Completion of the acquisition is subject to conditions including the adoption of the acquisition agreement by Mac-Gray's stockholders, regulatory approval, and other customary closing conditions. The parties expect the transaction to be completed in the first half of 2014. Following completion of the transaction, Mac-Gray's common stock will be delisted from the New York Stock Exchange and will no longer trade publicly.

BofA Merrill Lynch is acting as financial advisor to Mac-Gray and Goodwin Procter LLP is serving as legal counsel. Morgan Stanley & Co. LLC, Deutsche Bank Securities Inc. and Evercore Group L.L.C. are acting as financial advisors to CSC; and Kirkland & Ellis LLP is serving as legal counsel.

About CSC ServiceWorks
CSC ServiceWorks, with over one million machines in service, is the leading provider of multi-family housing and commercial laundry solutions as well as the industry leader in air vending services at convenience stores and gas stations. CSC's family of businesses includes: Coinmach Corp., ASI Campus Laundry Solutions, SDI Laundry Solutions, Sparkle Solutions Corp., Appliance Warehouse of America, AIR-serv, AirValet and Super Laundry. CSC ServiceWorks has a workforce of over 2,250 dedicated professionals throughout the United States, Canada and Europe.

About Mac-Gray Corporation
Founded in 1927, Mac-Gray derives its revenue principally through the contracting of debit-card- and coin-operated laundry facilities in multi-unit housing facilities such as apartment buildings, college and university residence halls, condominiums and public housing complexes. Mac-Gray manages laundry rooms in 44 states and the District of Columbia. Mac-Gray also sells and services commercial laundry equipment to retail laundromats and other customers through its product sales division. To learn more about Mac-Gray, visit the Company's website at

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