Relational Investors LLC And CalSTRS File Comprehensive Presentation Urging Timken To Unlock Shareholder Value By Separating Its Steel And Bearings Businesses; Timken’s Conglomerate Structure Impairing Shareholder Value

Relational Investors LLC (“Relational”) and the California State Teachers’ Retirement System (“CalSTRS”), collectively owners of 7.28% of The Timken Company, (NYSE: TKR) (“Timken” or “the Company”), today filed a comprehensive presentation for Timken shareholders entitled “Why a Separation of Timken’s Steel and Bearings Businesses Can Unlock Significant Shareholder Value.” The presentation further demonstrates the financial and operational logic of CalSTRS’ shareholder proxy proposal, which would enable Timken shareholders to vote for separating the two businesses. The presentation elaborates on the following points:

• There is currently a deep under-valuation of Timken’s shares due to the Company’s ill-conceived conglomerate structure, particularly as compared to its peers.
• By separating the steel and bearings businesses, Timken would realize improved operating performance and the investment community could appropriately value the earnings profile of each business – thus unlocking the value of these businesses for shareholders and enhancing their long-term potential.
• Each of Timken management’s public excuses to defend the Company’s conglomerate structure are not supported by empirical evidence.

Relational and CalSTRS have expressed their intent to continue a dialogue with shareholders and the broader investment community about the value creation potential of the separation of Timken’s steel and bearings businesses. Relational and CalSTRS have expressed their concerns about the Board’s inaction and attempts to ignore the investment community’s clear statements regarding the impediment to Timken’s stock price, the Company’s conglomerate structure and the value creation opportunity to be realized from the separation of Timken’s businesses.

CalSTRS, with the support of Relational, has filed a formal shareholder proposal to be voted on at this year’s Annual Meeting of Timken shareholders, recommending that the Company’s Board and management act expeditiously to effectuate a spin-off of Timken’s steel business segment into a separately traded public company. Relational fully supports CalSTRS proposal and has made such support publicly clear with Timken’s Board and its shareholders.

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