Filed Pursuant to Rule 424(b)(5)

Registration No. 333-47493

The information in this prospectus supplement and the accompanying prospectus is not complete and may be changed. This prospectus supplement and the accompanying prospectus are not an offer to sell nor do they seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED DECEMBER 16, 2004.

PROSPECTUS SUPPLEMENT

(To Prospectus dated January 27, 1999)

2,500,000 Shares

Actuant Corporation

Class A Common Stock

Actuant Corporation is offering 2,500,000 shares of its Class A common stock. Our Class A common stock is listed on the New York Stock Exchange under the symbol “ATU.” The last reported sale price of our Class A common stock on the New York Stock Exchange on December 14, 2004 was $48.95 per share.

We intend to use the net proceeds from this offering, together with borrowings under our new amended senior credit facility, to finance our acquisition of Key Components, Inc. and to reduce indebtedness. The closing of this offering is contingent upon the concurrent or prior acquisition of Key Components, Inc. and the concurrent or prior amendment of our senior credit facility.

Investing in our Class A common stock involves risks. See “ Risk Factors” beginning on page S-26 of this prospectus supplement.

Delivery of the shares of our Class A common stock will be made on or about December     , 2004.

Neither the Securities and Exchange Commission, any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus supplement or the prospectus to which it relates is truthful or complete. Any representation to the contrary is a criminal offense.

We have granted the underwriters an option to purchase a maximum of 375,000 additional shares of our Class A common stock to cover over-allotments of shares, if any, exercisable at any time until 30 days after the date of this prospectus supplement.

Wachovia Securities

                JPMorgan    UBS Investment Bank

                                         Robert W. Baird & Co.     Bear, Stearns & Co. Inc.

The date of this prospectus supplement is December     , 2004

Tools & Supplies

Engineered Solutions

Industrial Hydraulic Tools		Electrical Tools & Consumables		Specialty Electrical		Power Conversion

Truck Actuation		Convertible Top Actuation		Flexible Shaft Actuation		Aerospace Battery Systems

RV Actuation				Electric Utility		Truck Turbocharger

TABLE OF CONTENTS

Prospectus Supplement

Prospectus

You should rely only on the information contained or incorporated or deemed to be incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not authorized

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anyone to provide you with different or varying information. We are offering to sell, and seeking offers to buy, shares of common stock only in jurisdictions where offers and sales are permitted. When you make a decision about whether to invest in our common stock, you should not rely on any information other than the information contained or incorporated or deemed to be incorporated by reference in this prospectus supplement or the accompanying prospectus. You should assume that information appearing in this prospectus supplement, the accompanying prospectus and the documents incorporated and deemed to be incorporated by reference in this prospectus supplement and the accompanying prospectus is accurate only as of their respective dates. Our business, financial condition, results of operations and prospects, and the business, financial condition, results of operations and prospects of Key Components, Inc., may have changed since those dates.

This prospectus supplement is part of, and you should read it in conjunction with, the accompanying prospectus. In that regard, our company was previously known by the name Applied Power Inc., and the accompanying prospectus refers to us by our prior name. In addition, as described under “Incorporation of Certain Documents by Reference,” certain of the information in the accompanying prospectus has been superceded and replaced by the information in this prospectus supplement. Unless otherwise indicated or the context otherwise requires, in this prospectus supplement:

This prospectus supplement contains trademarks and trade names of other companies.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus supplement and the accompanying prospectus, including the documents incorporated and deemed to be incorporated by reference herein and therein, contain statements that constitute forward-looking statements. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in the forward-looking statements. The words “may,” “should,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “project,” “plan,” “objective” and similar expressions are intended to identify forward-looking statements. Additionally, any projections or estimates of future revenues, earnings, earnings per share, tax rates, interest rates, debt reductions, earnings before interest, taxes, depreciation and amortization or similar matters (both with respect to Actuant or any companies we have acquired or may acquire), any projections or estimates regarding the effect of completed or pending acquisitions on revenues, earnings, earnings per share or other operating results, any projections or estimates of dates by which orders included in our backlog will be filled, future profit margins or

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operating results (including profit margins or operating results of us, our business units, companies we have acquired or may acquire or business units of those other companies), future sales to the recreational vehicle market, future profit margins of our automotive business, future commodity prices and their impact on gross profits, and future sales of convertible top actuation and latching systems, and any statements regarding our goals as to growth in our annual diluted earnings per share and our intention to leverage our market position to generate internal sales growth and the effect of our “Lean Enterprise Across Disciplines” process on profit margins, are forward-looking statements, and the actual results of operations, financial condition and other events and conditions could differ, perhaps substantially, from those expressed or implied in those forward-looking statements. In addition to the assumptions and other factors referred to specifically in connection with the forward-looking statements included in this prospectus supplement and the accompanying prospectus and the documents incorporated or deemed to be incorporated by reference herein and therein and the risk factors discussed in this prospectus supplement under the caption “Risk Factors,” factors that may cause actual results or events to differ materially from those contemplated by such forward-looking statements include, without limitation, general economic conditions and market conditions in the industrial production, truck, construction, automotive, and recreational vehicle industries in North America and Europe and, to a lesser extent, Asia, and in the recreational boating and marine, electric utility and aerospace industries in North America, market acceptance of existing and new products, successful integration of acquisitions, competitive pricing, foreign currency risks, prices of commodities and other raw materials, interest rate risks, environmental matters, our ability to access capital markets, our high debt level, unforeseen costs and other factors that may be referred to in this prospectus supplement and the accompanying prospectus and the documents incorporated and deemed to be incorporated by reference herein and therein.

All forward-looking statements attributable to us, or to persons acting on our behalf, are expressly qualified in their entirety by this cautionary statement.

In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus supplement and the accompanying prospectus and the documents incorporated and deemed to be incorporated by reference herein and therein might not transpire.

MARKET DATA

The information in this prospectus supplement and the accompanying prospectus and the documents incorporated by reference herein and therein concerning market positions of certain of our products is based on our net sales for fiscal year 2004 and management’s estimates of our competitors’ respective dollar volumes of net sales for the products, markets and geographic region or regions to which we refer. These estimates are based on our internal estimates, our knowledge of our relative position and the relative position of our competitors in applicable markets, and, in some limited cases, industry sources. Other market data included in this prospectus supplement and the accompanying prospectus and the documents incorporated by reference in this prospectus supplement and the accompanying prospectus concerning our business is estimated and is based on independent industry publications or other publicly available information. Although we believe that the information on which we have based these estimates of our market position and this market data are generally reliable, the accuracy and completeness of this information is not guaranteed and this information has not been independently verified. The information in this prospectus supplement and the documents incorporated by reference herein concerning market positions of certain of KCI’s businesses and products is based on information provided to us by KCI’s management and reports filed by KCLLC with the Securities and Exchange Commission. We have not independently verified this information and, accordingly, the accuracy of this information is not guaranteed. This prospectus supplement and the accompanying prospectus and the documents incorporated by reference herein and therein include sales data for businesses that we acquired prior to their dates of acquisition. This sales data was provided to us by the sellers of those businesses and has not been independently verified, and the accuracy of that information is not guaranteed.

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PROSPECTUS SUPPLEMENT SUMMARY

This summary provides an overview of selected information and does not contain all the information you should consider. You should read this entire prospectus supplement and the accompanying prospectus, including the section entitled “Risk Factors,” and the documents incorporated by reference and deemed to be incorporated by reference in this prospectus supplement and the accompanying prospectus carefully before making an investment decision. Unless we indicate otherwise, the information in this prospectus supplement assumes that the underwriters do not exercise their option to purchase additional shares of common stock.

Our Company

We are a diversified global manufacturer and marketer of a broad range of industrial products and systems, organized into two business segments, Tools & Supplies and Engineered Solutions. Our Tools & Supplies segment sells branded, specialized electrical and industrial tools and supplies to hydraulic and electrical tool wholesale distributors, to catalog houses and through various retail distribution channels. Our Engineered Solution segment’s primary expertise is in designing, manufacturing and marketing customized motion control systems primarily for automotive, recreational vehicle (“RV”) and truck original equipment manufacturers (“OEMs”) in diversified niche markets. We believe that our strength in these product categories is the result of the combination of our brand recognition, proprietary engineering and design competencies, dedicated service philosophy, and global manufacturing and distribution capabilities.

Over 75% of our net sales for our fiscal year ended August 31, 2004 were from products that we believe hold a leading position in their respective markets, based on our internal estimates of our competitors’ net sales of similar products. The following table sets forth our major product categories that we believe, based on these internal estimates, hold a leading position in their respective markets, as indicated, for those products:

We have increased our net sales from $481.9 million for the fiscal year ended August 31, 2001 to $726.9 million for the fiscal year ended August 31, 2004, while our operating profits have grown from $71.9 million for fiscal year 2001 to $90.3 million for fiscal year 2004. We have also reduced our total indebtedness from $432.5 million at August 31, 2000 to $193.9 million at August 31, 2004. Although our indebtedness will increase as a result of the planned acquisition of Key Components, Inc., or “KCI,” described below, we will continue our efforts to reduce our leverage.

On November 18, 2004, we agreed to acquire KCI for a purchase price of $315 million, including the assumption of $80 million aggregate principal amount of 10.5% senior subordinated notes of two subsidiaries of KCI (the “KCI senior notes”). We expect to acquire KCI prior to or concurrently with the closing of this offering. KCI is a manufacturer of custom engineered products and componentry for applications in a diverse

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array of niche markets. For the twelve months ended September 30, 2004, KCI generated net sales of $209.1 million and income from operations of $36.3 million. On a pro forma basis, assuming that our acquisition of KCI and the related transactions had occurred on September 1, 2003, for the fiscal year ended August 31, 2004, our unaudited pro forma net sales would have been $936.0 million and our unaudited pro forma operating profit would have been $118.6 million. This unaudited pro forma data is subject to a number of assumptions, estimates and uncertainties and you should read it in conjunction with the information appearing under “Unaudited Pro Forma Condensed Consolidated Financial Statements.”

Tools & Supplies

The Tools & Supplies segment generated approximately 57% of our net sales for the fiscal year ended August 31, 2004. This segment includes our Enerpac, Gardner Bender, Dresco and Kopp businesses. These businesses share core competencies in product branding, distribution channel management, global sourcing and managing the logistics of SKU-intensive product lines. The segment’s products include high-force hydraulic tools and electrical tools and supplies that are sold directly to end-users, including customers in the general industrial, construction and production automation industries, as well as through retail home center, hardware cooperative, retail marine and retail automotive aftermarket distribution channels. Tools & Supplies provides over 25,000 SKUs, most of which are designed and manufactured by us in the United States, Germany or China. In addition, the segment manages a global sourcing operation that supplements its manufactured product offerings. Major customers include Lowe’s, Praktiker (Metro Group), Praxis, Hagebau/Zeus, Ace Hardware, The Home Depot, Gamma, Menards and W.W. Grainger. This segment also sells to over 12,000 small accounts globally and over 3,000 wholesale electrical, marine and automotive aftermarket distributors.

The following table illustrates our brands, products and key customers in our Tools & Supplies segment:

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Engineered Solutions

The Engineered Solutions segment generated approximately 43% of our net sales for the fiscal year ended August 31, 2004. We believe that the Engineered Solutions segment is a leading global designer and manufacturer of customized motion control systems for OEMs in a variety of niche industrial markets. The segment works with its customers to provide customized solutions, with a major presence in the RV, heavy-duty truck and automotive markets. Products include RV slide-out, leveling, storage tray and retractable step systems, hydraulic cab-tilt and latching systems for heavy-duty cab-over-engine trucks, and electro-hydraulic automotive convertible top actuation and latching systems. We believe that the segment’s principal brands, Power-Packer, Power Gear, Kwikee, Yvel, Milwaukee Cylinder and Nielsen Sessions, are recognized for their engineering, quality, integrated custom design and geographic reach. Major customers include Wilhelm Karmann GmbH, Fleetwood, CTS Dachsysteme, Monaco, Winnebago, Volvo and ASC Incorporated.

The following table illustrates our brands, products and systems and key customers in our Engineered Solutions segment:

Our Competitive Strengths

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Our Strategy

In our Engineered Solutions segment, we have cultivated long-standing relationships with leading global OEMs who we believe have selected us as a vendor based on factors such as our proprietary designs, engineering expertise, quality and ability to support our customers in multiple locations around the world. We believe that these relationships provide us with opportunities for growth, particularly as our OEM customers expand into new geographic markets.

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In addition, we use stock-based incentives to align our employees’ interests with those of our shareholders. Substantially all of our U.S.-based employees participate in a structured incentive compensation system based on achievement of both definitive performance targets for both the employee’s business unit and overall company results. These performance targets are based on year-over-year improvements in earnings less an asset carrying charge. Executive compensation is heavily weighted toward stock ownership, which is intended to align management’s interest with investors’ interests in achieving our strategic goals. Based upon the number of shares and options outstanding on August 31, 2004, management, director, and employee stock ownership represented more than 11% of our outstanding diluted shares of common stock. This percentage is calculated by dividing shares and shares issuable upon exercise of options owned by our officers, directors and employees by the total number of outstanding shares and shares issuable upon exercise of outstanding options, and does not take into account shares issuable upon conversion of our outstanding 2% convertible senior subordinated debentures due 2023, which we sometimes refer to as the “2% convertible senior subordinated debentures”.

Divestitures and Acquisitions

Prior to July 31, 2000, we were known as Applied Power, Inc., and our business consisted of two segments, Electronics and Industrial. The Electronics segment, which we refer to as the “Electronics Business” or “APW”, focused on electronic enclosures, while the Industrial segment, which we refer to as the “Industrial Business”, concentrated on the current Tools & Supplies and Engineered Solutions businesses, as well as other businesses that have been divested. On January 26, 2000, our board of directors authorized various actions intended to position us to distribute the Electronics Business to our shareholders in the form of a special dividend, which we refer to as the “spin-off” or the “distribution”. The spin-off took place on July 31, 2000, and at that time we began doing business as Actuant Corporation.

Subsequent to the spin-off, we divested businesses that did not fit within our strategy of selling branded tools and supplies and motion control systems. During fiscal 2001, we divested our medical products business, Mox-Med, which was included in our Engineered Solutions segment, and the Quick Mold Change product line, which was included in the Tools & Supplies segment.

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Thus far in fiscal 2005, we have acquired A.W. Sperry Instruments, Inc., a leading provider of electrical test meters and instruments to the North American professional and retail channels (“Sperry”), and Yvel S.A., a leading provider of hydraulic latches to the European cab-over-engine heavy-duty truck market (“Yvel”). In fiscal 2004, we acquired Dresco B.V., a provider of electrical, plumbing and other supplies to the Benelux retail home center markets (“Dresco”), and Kwikee Products Company, Inc., a leading North American provider of storage tray and retractable step systems for the North American RV market (“Kwikee”). In fiscal 2003, we acquired Heinrich Kopp AG (“Kopp”), a provider of electrical products to the German, Austrian and Eastern European retail home center markets. Also in fiscal 2003, we acquired Shanghai Sanxin Hydraulic Co., Ltd. (“Shanghai Sanxin”). During fiscal 2001, we acquired the assets of Dewald Manufacturing, Inc., a provider of slide-out and leveling systems to the North American RV market (“Dewald”). Dresco, Kopp, Shanghai Sanxin and Sperry are included in our Tools & Supplies segment, while Dewald, Kwikee and Yvel are included in our Engineered Solutions segment.

In addition, as discussed below under “—Acquisition of Key Components, Inc.,” we have entered into a stock purchase agreement to acquire KCI.

As you review our consolidated financial statements and the other information included and incorporated by reference in this prospectus supplement and the accompanying prospectus, please consider the effects of the divestitures and acquisitions described above and elsewhere in this prospectus supplement and the documents incorporated by reference herein.

Recent Developments

First Quarter Earnings Release

On December 16, 2004, we announced our results of operations for our fiscal quarter ended November 30, 2004, which is the first quarter of fiscal 2005. Net sales for the quarter ended November 30, 2004 increased approximately 20% to $199.7 million compared to $166.6 million for the quarter ended November 30, 2003. Results for the quarter ended November 30, 2004 included net sales from Dresco, which we acquired on December 30, 2003, and Yvel, which we acquired on September 16, 2004. Excluding the impact of the Dresco and Yvel acquisitions and foreign currency exchange rate changes, net sales for the quarter ended November 30, 2004 increased approximately 6% over the quarter ended November 30, 2003. Net earnings and diluted earnings per share (“EPS”) for the quarter ended November 30, 2004 were $17.5 million and $0.71, respectively, which includes a $2.0 million pre-tax gain, or $1.3 million after tax ($0.05 per diluted share), for the favorable settlement of a liability to APW, a former subsidiary. In connection with this settlement, we made a payment of approximately $15.8 million to APW for a fiscal 2000 income tax refund. This compares to net earnings and EPS of $0.3 million and $0.01, respectively, for the first quarter of fiscal 2003, which included a charge of $15.1 million, or $9.8 million after tax ($0.40 per diluted share), attributable to the early extinguishment of debt.

Net sales in the Tools & Supplies segment for the quarter ended November 30, 2004 were $112.5 million, a 17% increase over net sales of $96.3 million for the quarter ended November 30, 2003. Excluding the impact of the Dresco acquisition and the weaker U.S. dollar, Tools & Supplies segment net sales in the quarter ended November 30, 2004 increased approximately 2% compared to the quarter ended November 30, 2003. Engineered Solutions segment net sales in the quarter ended November 30, 2004 were $87.1 million, a 24% increase over net sales of $70.2 million for the quarter ended November 30, 2003 due to higher sales in the automotive and truck markets, the weaker U.S. dollar and the Yvel acquisition. Excluding the impact of the Yvel acquisition and foreign currency exchange rate changes, Engineered Solutions segment net sales grew 12% for the quarter ended November 30, 2004 compared to the quarter ended November 30, 2003.

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Our operating profit in the quarter ended November 30, 2004 was $27.3 million, or 32% higher than the $20.7 million in the quarter ended November 30, 2003, resulting from both sales and operating profit margin growth. Operating profit margin (which we define as operating profit divided by net sales) increased from 12.4% in the quarter ended November 30, 2003 to 13.7% in the quarter ended November 30, 2004. Operating profit margins in the quarter ended November 30, 2004 improved in both of our business segments compared to the quarter ended November 30, 2003. Tools & Supplies segment operating profit was $17.7 million, or 15.7% of net sales, for the three months ended November 30, 2004, compared to $14.4 million, or 14.9% of net sales, for the quarter ended November 30, 2003. For the three months ended November 30, 2004 and 2003, Engineered Solutions segment operating profit was $12.2 million (14.0% of net sales) and $8.8 million (12.5% of net sales), respectively. General corporate operating loss was $2.6 million and $2.4 million for the three months ended November 30, 2004 and 2003, respectively.

Total debt (including current maturities) at November 30, 2004 was approximately $212 million. Net debt (total debt less approximately $7 million of cash) was $205 million at November 30, 2004, compared to $188 million at August 31, 2004. The increase results from approximately $9 million of borrowings to fund the Yvel acquisition, and $16 million of borrowings to reimburse APW for a fiscal 2000 income tax refund, partly offset by operating cash flow in the quarter ended November 30, 2004.

The following table sets forth certain unaudited summary financial data for the quarters ended November 30, 2004 and November 30, 2003. Additional information with respect to our results of operations and financial condition for these quarters is incorporated by reference in this prospectus supplement and may be obtained as described under “Incorporation of Certain Documents by Reference.” The following summary financial data as of and for the quarter ended November 30, 2004 is not necessarily indicative of our results of operations or financial condition for any future period or as of any future date.

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Summary Financial Data For Quarters

Ended November 30, 2004 and 2003

(in millions except per share amounts)

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Amended Senior Credit Facility

Our primary credit facility is a $250 million senior revolving credit facility, which we sometimes refer to as our “senior credit facility.” Concurrently with the closing of our acquisition of KCI, we intend to amend our senior credit facility, which we sometimes refer to herein as the “amended senior credit facility”, by adding a new $250 million five year term loan, borrowing $250 million under this new term loan and applying the proceeds from those borrowings to finance the purchase of KCI and to pay related costs and expenses. We anticipate that the amended senior credit facility will consist of a $250 million revolving credit facility and a $250 million term loan which will require repayments of principal in the last three years of the term loan. Both the revolving credit facility and the term loan will mature in 2009. For additional information with respect to the anticipated terms of the amended senior credit facility, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.”

Recent Acquisitions

On December 1, 2004, we completed the purchase of all the outstanding stock of Sperry for approximately $12.5 million. Located in Hauppauge, New York, Sperry designs, tests, assembles, packages, and sells electrical test meters and instruments to the North American professional and retail channels.

On September 16, 2004, we completed the purchase of all the outstanding shares of Yvel for approximately $10.0 million. Located in Paris, France, Yvel is a leading provider of hydraulic latches to the European heavy duty cab-over-engine truck market.

Changes in our Board of Directors

On October 29, 2004, we announced the appointment of Larry Yost to our board of directors. Mr. Yost recently retired from ArvinMeritor where he held the positions of Chief Executive Officer and Chairman of the Board.

Two of our directors, H. Richard Crowther and Bruce S. Chelberg, have indicated that they will retire from our board of directors at our annual meeting to be held on January 10, 2005. The retirement of these two directors is pursuant to a director succession plan. Under this plan, we have already added three new directors, including Mr. Yost, in the past eighteen months.

Our Address

Headquartered in Milwaukee, we are a Wisconsin corporation incorporated in 1910. Our principal executive offices are located at 6100 North Baker Road, Milwaukee, Wisconsin 53209 and our telephone number at that location is (414) 352-4160.

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Acquisition of Key Components, Inc.

On November 18, 2004, we entered into a stock purchase agreement pursuant to which we agreed to acquire all of the outstanding stock of KCI, which we sometimes refer to as the “KCI acquisition.” The aggregate purchase price is approximately $315 million, including the assumption of $80 million aggregate principal amount of KCI senior notes. The purchase price for KCI is subject to a possible reduction in the event that KCI’s working capital at the closing date is less than a specified amount.

We expect the KCI acquisition to close concurrently with or prior to this offering and that we will enter into our amended senior credit facility concurrently with the closing of the KCI acquisition. We intend to finance the acquisition and pay related costs and expenses with the proceeds from the new $250 million term loan under the amended senior credit facility. Accordingly, we expect that, on the closing date of the KCI acquisition, we will be required to make a cash payment of approximately $235 million to acquire KCI, which reflects the purchase price of approximately $315 million less $80 million aggregate principal amount of KCI senior notes that we will assume. In addition, we intend to use the net proceeds from this offering, together with the remaining proceeds from the new $250 million term loan, to redeem the KCI senior notes (or, as described below, to repay revolving credit borrowings temporarily incurred for that purpose), repay revolving credit and/or commercial paper borrowings and pay related costs and expenses. We anticipate that the total redemption price for the KCI senior notes will be approximately $84.2 million, including redemption premium and accrued interest, and that the redemption will occur in January 2005.

We expect that the bank lenders under our amended senior credit facility will require that, concurrently with the closing of the KCI acquisition, we make an irrevocable cash deposit with the trustee for the KCI senior notes in an amount equal to the anticipated redemption price of the KCI senior notes, which deposit will be held by the trustee and applied to redeem the KCI senior notes on the applicable redemption date in January 2005. We sometimes refer to this anticipated cash deposit as the “Redemption Deposit.” If the KCI acquisition closes prior to the closing of this offering, we anticipate that we will finance the Redemption Deposit with revolving credit borrowings under our amended senior credit facility and that we will repay those borrowings with a portion of the proceeds from this offering. If the KCI acquisition closes concurrently with the closing of this offering, we anticipate that we will finance the Redemption Deposit with a portion of the proceeds from this offering. To the extent that we initially finance the Redemption Deposit with revolving credit borrowings, we anticipate that those borrowings will be outstanding only temporarily. Accordingly, we have not reflected those possible revolving credit borrowings in the pro forma financial data, pro forma financial statements or other similar information appearing elsewhere in this prospectus supplement.

The stock purchase agreement contains customary conditions to each of our and the sellers’ obligations to close. See “—Acquisition Financing and Related Transactions,” “Use of Proceeds” and “Unaudited Pro Forma Condensed Consolidated Financial Statements.” We anticipate that all of KCI’s outstanding stock options will be repurchased or cancelled in connection with the KCI acquisition.

Key Components, Inc.

KCI is a manufacturer of custom engineered products and componentry for applications in a diverse array of niche markets. KCI operates six businesses units, which are presently organized into two reporting segments, Electrical Components (“EC”) and Mechanical Engineered Components (“MEC”). Through these six decentralized business units, KCI manufactures mechanical and electrical components and supplies its products to OEMs and through other distribution channels. KCI’s strategy is to build competitive advantages by focusing on markets where it believes it can differentiate itself through product customization, value-added engineering and superior customer support. We believe, based on information provided to us by KCI’s management and KCLLC’s reports filed with the Securities and Exchange Commission, that a number of KCI’s products hold a leading position in their respective markets.

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The six business units that comprise KCI’s EC and MEC segments are described below:

Electrical Components Segment

Mechanical Engineered Components Segment

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KCLLC, a subsidiary of KCI, is subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith files reports and other information with the Securities and Exchange Commission, or “SEC”. The information filed by KCLLC with the Securities and Exchange Commission is not part of and is not incorporated by reference in this prospectus supplement or the accompanying prospectus.

Strategic Benefits of the KCI Acquisition

Leading Positions in Niche Markets.    Over 75% of Actuant’s net sales for the fiscal year ended August 31, 2004 were from products that we believe hold a leading position in their respective markets, based on our internal estimates of our competitors’ net sales of similar products. We also believe that a number of KCI’s products hold a leading position in their respective markets, based on information provided to us by KCI’s management. For example, we believe that KCI’s Acme Power Distribution Products business is a leading manufacturer of single-phase, dry-type transformers sold into the low voltage segment of the North American transformer market, that KCI’s Turner Electrical Utility business is a leading manufacturer of high voltage utility pole-top switchgear products sold to the transmission segment of the North American electric utility industry, that KCI’s Elliott Flexible Shafts business is a leading North American supplier of flexible shaft products and assemblies for the transmission of rotary power, and that KCI’s Air Handling/Turbocharger Components business is a leading designer and supplier of wastegate actuators used in air handling/turbocharger systems produced by diesel truck engine and turbocharger manufacturers.

Complementary Product Lines.    The addition of KCI will add new products to the Actuant platform. Certain of these products are sold in some of the same niche markets in which Actuant participates and therefore complement Actuant’s current product offerings. As a result, we expect that the KCI acquisition will allow us to offer a broader line of products to certain of the customers and markets that we currently serve.

For example, our Ancor product line sells electrical wire, connectors, wire management consumables and installation tools that are used in the marine industry to make electrical connections within a boat, while KCI’s Specialty Electrical business offers a broad line of electrical products sold to the recreational marine market, such as ship-to-shore electrical connectors, electrical receptacles, plugs and switches, as well as non-electrical accessories such as vents, tables, ladders and fishing pole holders. There is also an opportunity to leverage KCI’s Specialty Electrical products in the RV market, where we believe that we hold a leading position in the North American market for RV slide-out, leveling, storage tray and retractable step systems. Likewise, KCI’s Air Handling/Turbocharger Components business supplies products to leading diesel engine

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and turbocharger manufacturers in North America but has relatively few customers in Europe, where we believe that our Power Packer business has a strong presence in the market for hydraulic cab-tilt and latching systems for heavy-duty cab-over-engine trucks.

Similar Business Model.    We believe that there are similarities between the Actuant and KCI business models. For example, both companies operate multiple business units through a decentralized management structure. In that regard, each of KCI’s six business units has its own management team, consisting of a General Manager or President and financial, operations, human resources, and sales and marketing personnel. Likewise, both Actuant and KCI sell their products into niche markets, which we believe can provide opportunities for higher margins compared to larger, more competitive markets. Finally, we believe that both companies focus on design and engineering capabilities to strengthen ties with customers.

Opportunities to Improve Performance with Actuant’s LEAD Process.    We believe that our LEAD (“Lean Enterprise Across Disciplines”) process has allowed us to improve the operating performance of a number of the businesses we have acquired over the last several years. LEAD focuses on return on assets and operational improvement initiatives intended to increase manufacturing output and quality while reducing costs. We believe that opportunities exist to improve KCI’s operating results through the use of our LEAD process.

Increased Size and Scale.    Through the KCI acquisition, we will become a larger company, which we expect will provide opportunities for us to realize cost efficiencies in supplier and distributor operations. Similarly, we expect to consolidate KCI’s corporate offices, which are currently located in Tarrytown, New York, with our headquarters in Glendale, Wisconsin, thereby eliminating some redundant functions and costs. We also expect that the larger size of the combined entity will enhance our purchasing power with suppliers and may make us a more attractive employer for some prospective employees. We also believe that some of KCI’s business units will be able to benefit from the favorable manufacturing costs of some of our existing suppliers in China and other Asian countries, thus creating opportunities for improved margins.

Increased Diversification of the Actuant Platform.    The addition of KCI will bring new niche markets to our business. For example, the acquisition will add products sold to the defense and aerospace, lawn and garden, and other markets. We believe that this increased diversification could help mitigate the effect of economic cycles within the particular industries we currently serve.

For further information on KCI, see “Business – Key Components, Inc.”

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Acquisition Financing and Related Transactions

We have agreed to acquire KCI for a purchase price of approximately $315 million, of which approximately $235 million is payable in cash and $80 million is payable through the assumption of the KCI senior notes. We sometimes refer to this cash payment as the “Cash Portion” of the KCI purchase price. We intend to use the proceeds from the new $250 million term loan under our amended senior credit facility to pay the Cash Portion of the purchase price for KCI and related costs and expenses. We intend to use the remaining proceeds from the new $250 million term loan as described below.

We intend to use the net proceeds from this offering, together with the remaining proceeds from the new $250 million term loan, to redeem the KCI senior notes (or, as described below, to repay revolving credit borrowings temporarily incurred for that purpose), reduce our revolving credit and/or commercial paper borrowings and pay related costs and expenses. This offering is contingent upon the concurrent or prior closing of the KCI acquisition and amendment of our senior credit facility. The issuance and sale of the common stock in this offering, the KCI acquisition, the redemption of the KCI senior notes, the amendment to our senior credit facility and the borrowing of the $250 million term loan thereunder, the use of proceeds to reduce our revolving credit and/or commercial paper borrowings and the payment of related costs and expenses are collectively herein referred to as the “Transactions.”

The KCI senior notes are subject to redemption at the option of KCI at a redemption price currently equal to 103.5% of the principal amount plus accrued interest. Following completion of the KCI acquisition, we intend to redeem all of the outstanding KCI senior notes for an aggregate redemption price of approximately $84.2 million. We anticipate that this redemption will occur in January 2005.

We expect that the bank lenders under our amended senior credit facility will require that, concurrently with the closing of the KCI acquisition, we make an irrevocable cash deposit with the trustee for the KCI senior notes in an amount equal to the anticipated redemption price of the KCI senior notes, which deposit will be held by the trustee and applied to redeem the KCI senior notes on the applicable redemption date in January 2005. We sometimes refer to this anticipated cash deposit as the “Redemption Deposit”. If the KCI acquisition closes prior to the closing of this offering, we anticipate that we will finance the Redemption Deposit with revolving credit borrowings under our amended senior credit facility and that we will repay those borrowings with a portion of the proceeds from this offering. If the KCI acquisition closes concurrently with the closing of this offering, we anticipate that we will finance the Redemption Deposit with a portion of the proceeds from this offering. To the extent that we initially finance the Redemption Deposit with revolving credit borrowings, we anticipate that those borrowings will be outstanding only temporarily. Accordingly, we have not reflected those possible revolving credit borrowings in the following table or in the pro forma financial data, pro forma financial statements or other similar information appearing elsewhere in this prospectus supplement.

The following table sets forth the estimated sources and uses of funds relating to the Transactions, assuming that all of the Transactions were completed on August 31, 2004 (dollars in millions):

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The Offering

Subsequent to August 31, 2004, we granted options to purchase 262,800 additional shares of common stock under our stock option plans.

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Summary Consolidated Financial Data—Actuant

The following summary consolidated financial data for and as of the end of each of the three fiscal years ended August 31, 2004 are derived from our audited consolidated financial statements. The data should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2004, which is incorporated by reference into this prospectus supplement, and with the information appearing under “Recent Developments—First Quarter Earnings Release” above and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus supplement. The results of all businesses acquired during the time periods presented are included in the table only from their respective acquisition dates.

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EITF No. 04-8 will not impact the 2003 or 2002 fiscal year results because we issued the 2% convertible senior subordinated debentures in November 2003. The foregoing data is based upon an increase of 3,027,636 common and equivalent shares, which is less than the 3,758,445 shares, issuable upon conversion of the 2% convertible senior subordinated debentures, due to the fact that those debentures were not outstanding for all of fiscal 2004. Had the full number of shares issuable upon conversion of those debentures been used in the foregoing calculation, the reduction in diluted earnings per share would have been greater than the reduction reflected above. In fiscal 2005, the number of weighted average common and equivalent shares outstanding for purposes of computing diluted earnings per share will include the full 3,758,445 shares issuable on conversion of the 2% convertible senior subordinated debentures. For information regarding the impact of the adoption of EITF No. 04-8 on earnings per share for the first quarter of fiscal 2005, see “Risk Factors—We will be required to include shares of common stock issuable upon conversion of our 2% convertible senior subordinated debentures when computing diluted earnings per share commencing with the second quarter of fiscal 2005, which will reduce diluted earnings per share and could adversely affect the market price of our common stock.”

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Summary Consolidated Financial Data—KCI

The following summary consolidated financial data for and as of the end of each of the three years ended December 31, 2003 are derived from KCI’s audited consolidated financial statements included in this prospectus supplement. The following summary consolidated financial data for and as of the end of the nine months ended September 30, 2004 and 2003 are derived from KCI’s unaudited consolidated financial statements, certain of which are included in this prospectus supplement. Financial data as of and for the nine months ended September 30, 2004 are not indicative of KCI’s results of operations or financial condition for any future period or as of any future date. The data should be read in conjunction with KCI’s financial statements included elsewhere in this prospectus supplement. The results of businesses acquired during the time periods presented are included in the table only from their respective acquisition dates. In that regard, KCI’s acquisitions included two businesses that designed, manufactured and marketed light-duty security locks (the “locks business”). KCI divested the locks business on October 22, 2004 to an independent third party. Operating results for the locks business are reported as discontinued operations in the table below.

We anticipate that we will effect certain changes to KCI’s business following the KCI acquisition. As a result, the historical results of operations and financial condition of KCI as reflected in the following table and elsewhere in this prospectus supplement are not necessarily indicative of its future operating results or financial condition.

For additional information about these acquisitions, including additional information concerning certain additional purchase price payments that KCI may be required to make, see the notes to KCI’s consolidated financial statements included elsewhere in this prospectus supplement.

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Summary Unaudited Pro Forma Condensed Consolidated Financial Data

We derived the following summary unaudited pro forma condensed consolidated financial data by applying pro forma adjustments to both our and KCI’s historical financial statements. The following unaudited pro forma statement of earnings data for the fiscal year ended August 31, 2004 reflects the following events as if each had occurred at the beginning of the period, and the following unaudited pro forma balance sheet data as of August 31, 2004 reflects the following events as if each had occurred on August 31, 2004:

The actual purchase price for KCI is subject to a possible reduction in the event that KCI’s working capital as of the closing date is less than a specified amount.

KCI will be required to give holders of the KCI senior notes at least 30 days advance notice of the redemption of those notes, and we therefore expect that this redemption will occur during January 2005. We expect that the other transactions reflected in the foregoing bullet points will occur prior to or contemporaneously with the closing of this offering.

The unaudited pro forma financial data does not reflect the activity of Yvel and Sperry, which we acquired after August 31, 2004. In addition, the unaudited pro forma financial data does not reflect the full year impact of our acquisition of Dresco, which was acquired on December 30, 2003, or KCI’s acquisitions of Advanced Devices, Inc. and Amveco Magnetics, Inc. on May 7, 2004 and August 23, 2004, respectively. The unaudited pro forma financial data also does not reflect revolving credit borrowings that we may be required to make to temporarily finance the Redemption Deposit as described above under “—Acquisition Financing and Related Transactions” or the application of a portion of the net proceeds from this offering to repay those borrowings if we are required to make them.

The unaudited pro forma condensed consolidated statement of earnings data for the fiscal year ended August 31, 2004 combines the historical consolidated statement of earnings of Actuant for the fiscal year ended August 31, 2004 and the consolidated historical results of operations of KCI for the twelve months ended September 30, 2004. The unaudited pro forma condensed consolidated balance sheet data as of August 31, 2004 combines the consolidated historical balance sheet of Actuant as of that date with the consolidated historical balance sheet of KCI as of September 30, 2004. The unaudited pro forma condensed consolidated financial data appearing below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and KCI’s historical financial statements and related notes included elsewhere in this prospectus supplement and the historical financial statements and related notes of Actuant incorporated by reference in this prospectus supplement.

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The unaudited pro forma condensed consolidated financial data have been prepared giving effect to the KCI acquisition, which will be accounted for using the purchase method of accounting in accordance with SFAS No. 141, “Business Combinations.” The total purchase price will be allocated to the net assets of KCI based upon estimates of their fair value. The fair value of some of these assets will be determined on the basis of professional appraisals, none of which has yet commenced. The pro forma adjustments reflected in the following unaudited pro forma financial data are based on our estimates of the value of KCI’s tangible and intangible assets without the benefit of professional appraisals. Accordingly, the final purchase price allocation will likely differ from the allocation reflected in the following unaudited pro forma condensed consolidated financial data. In addition, the final purchase price allocation may also differ from that reflected in this unaudited pro forma financial data to the extent that the actual purchase price we pay for KCI is reduced because KCI’s working capital as of the closing date is less than a specified amount. A final valuation of some of KCI’s assets will be performed after the completion of the acquisition.

The unaudited pro forma condensed consolidated financial data is based upon available information and a number of assumptions and estimates and is subject to other uncertainties. The unaudited pro forma condensed consolidated financial data is presented for informational purposes only and does not purport to represent what our actual results of operations or financial position would have been had the KCI acquisition and related transactions described above been consummated at the dates indicated, nor do they purport to be indicative of our future results of operations or financial condition.

(dollars in millions, except per share amounts)

(unaudited)

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Amortization of intangible assets, if applicable, will occur over the estimated useful lives of the intangible assets, which we estimate will range from five to ten years. Estimated intangible assets include $30 million of trademarks (indefinite life), $16 million of patents (ten year amortization), and $7 million of customer relationships (five year amortization).

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RISK FACTORS

You should carefully consider the risks described below, as well as other information included or incorporated by reference in this prospectus supplement and the accompanying prospectus, before making any investment in our common stock. If any of the events described below occurs, our business, financial condition or results of operations could be materially harmed, the trading price of our common stock offered by this prospectus supplement could decline and you may lose all or part of your investment. We also may encounter risks in addition to those described below, which could have similar results.

Risks Relating to Our Business

We may not be able to realize the anticipated benefits from the KCI acquisition.

We may not be able to realize the anticipated benefits from the KCI acquisition. Achieving those benefits depends on the timely, efficient and successful execution of a number of post-acquisition events, including integrating KCI’s diversified businesses into our company. Factors that could affect our ability to achieve these benefits include:

If KCI’s businesses do not operate as we anticipate, it could materially harm our business, financial condition and results of operations. In addition, KCI’s six business units operate in a number of niche markets in which we have little or no experience. Accordingly, we will be highly dependent upon KCI’s existing managers and employees to manage those businesses, and the loss of any key KCI managers or employees could have a material adverse effect on our business.

In addition, as a result of the KCI acquisition, we will assume all of KCI’s liabilities. We may learn additional information about KCI’s business that adversely affects us, such as unknown or contingent liabilities, issues relating to internal controls over financial reporting and issues relating to compliance with the Sarbanes-Oxley Act or other applicable laws. As a result, there can be no assurance that the KCI acquisition will be successful or will not, in fact, harm our business. Among other things, if KCI’s liabilities are greater than projected, or if there are obligations of KCI of which we are not aware at the time of completion of the acquisition, our business could be materially adversely affected.

The successful integration of KCI’s businesses into our company following the KCI acquisition will present significant challenges.

We anticipate that the KCI acquisition will place significant demands on our administrative, operational and financial resources, and we cannot assure you that we will be able to successfully integrate KCI’s businesses into our company. Our failure to successfully integrate KCI with our company, and to manage the challenges presented by the integration process successfully, may prevent us from achieving the anticipated benefits of the acquisition and could have a material adverse effect on our business.

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As of August 31, 2004, we had $193.9 million in total consolidated indebtedness, and, as of August 31, 2004, after giving pro forma effect to the Transactions as if they had occurred on that date, we would have had total consolidated indebtedness of $405.1 million. Because of this substantial debt, our operating flexibility and competitive position could be seriously harmed.

As of August 31, 2004, we had $193.9 million in total consolidated indebtedness. We will incur substantial additional indebtedness to finance the KCI acquisition. As of August 31, 2004, after giving pro forma effect to the Transactions as if they had occurred as of that date, we would have had approximately $405.1 million of total debt and $8.0 million of letters of credit outstanding and approximately $247.0 million of unused borrowing capacity under our amended senior credit facility. In addition, we are party to an accounts receivable securitization arrangement, under which trade receivables sold and being serviced by us were $24.6 million at August 31, 2004. If we were to discontinue the securitization program, as of August 31, 2004, we would have been required to borrow approximately $24.6 million to finance the resultant increase in working capital. In addition, as of August 31, 2004, we were a party to operating leases requiring future minimum lease payments aggregating approximately $74.9 million. In addition, as of September 30, 2004, KCI was a party to operating leases requiring future minimum lease payments aggregating approximating $7.9 million. Although our amended senior credit facility and other debt agreements contain and will contain limitations on the amount of additional indebtedness that we and our subsidiaries may incur, both we and our subsidiaries retain the ability to incur substantial additional indebtedness. Accordingly, we may incur additional indebtedness in the future, including indebtedness incurred or assumed in connection with acquisitions.

We have, and after the completion of the Transactions will continue to have, a substantial amount of debt which will continue to require significant interest and principal payments. Our level of debt and the limitations imposed on us by our debt agreements could adversely affect our operating flexibility and put us at a competitive disadvantage. Our substantial debt level may adversely affect our future performance, because, among other things:

Our ability to make scheduled payments of principal of, to pay interest on, or to refinance our indebtedness and to satisfy our other debt and lease obligations will depend upon our future operating performance, which may be affected by factors beyond our control. In addition, there can be no assurance that future borrowings or equity financing will be available to us on favorable terms or at all for the payment or refinancing of our indebtedness. If we are unable to service our indebtedness, our business, financial condition and results of operations would be materially adversely affected.

Market demand for our products and KCI’s products may suffer cyclical declines.

The level of market demand for our products and KCI’s products depends on the general economic condition of the markets in which we and KCI compete. A substantial portion of our revenues and KCI’s revenues is derived from customers in cyclical industries that typically are adversely affected by downward economic cycles, which may result in lower demand for products in the affected business segment. For

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example, we derive significant revenues from sales to original equipment manufacturers (“OEMs”) in the heavy-duty truck, recreational vehicle (“RV”), automotive and construction industries. If consumer confidence declines considerably or if conditions in these industries otherwise deteriorate, consumer discretionary spending on home, RV and automobile purchases and remodeling and other construction projects could be negatively impacted, which would adversely impact our sales to customers in these markets. KCI also operates in a number of the same industries as we do. As a result, deterioration in the conditions in any of these industries, as well as in any of the other industries in which we and KCI operate, could adversely affect our and KCI’s businesses.

We will be required to include shares of common stock issuable upon conversion of our 2% convertible senior subordinated debentures when computing diluted earnings per share commencing with the second quarter of fiscal 2005, which will reduce diluted earnings per share and could adversely affect the market price of our common stock.

We have excluded the potential conversion of our 2% convertible senior subordinated debentures into common stock in our diluted earnings per share calculation because the conditions under which conversion is allowed have not been met. The Emerging Issues Task Force (“EITF”) has adopted EITF No. 04-8, “The Effect of Contingently Convertible Debt on Diluted Earnings per Share,” which will require the inclusion of the potential conversion of our 2% convertible senior subordinated debentures into common stock in our diluted earnings per share calculation even if the conditions that must be satisfied to allow conversion have not been met. EITF 04-8 is effective for reporting periods ending after December 15, 2004. We will adopt EITF No. 04-8 during the second quarter of fiscal 2005 and our adoption will require us to retroactively restate operating results for the first quarter of fiscal 2005 and fiscal 2004. This restatement will have the following effect on fiscal 2004 and the first quarter of fiscal 2005 results:

The foregoing data for fiscal 2004 is based upon an increase of 3,027,636 common and equivalent shares, which is less than the 3,758,445 shares issuable upon conversion of the 2% convertible senior subordinated debentures, due to the fact that those debentures were not outstanding for all of fiscal 2004. Had the full number of shares issuable upon conversion of these debentures been used in the foregoing calculation for fiscal 2004, the reduction in diluted earnings per share would have been greater than the reduction reflected above. The foregoing data for the first quarter of fiscal 2005 includes the full 3,758,445 shares issuable upon conversion of the debentures.

Adoption of this rule will result in a substantial reduction in our diluted earnings per share and could have a material adverse effect on the market price of our common stock.

Our ability to service our debt obligations would be harmed if we fail to comply with the financial and other covenants of our debt agreements.

We anticipate that our amended senior credit agreement will contain, and our other debt agreements currently contain, a number of significant financial and other restrictive covenants. These covenants could adversely affect us by limiting our financial and operating flexibility as well as our ability to plan for and react to market conditions and to meet our capital needs. Our failure to comply with these covenants could result in events of default which, if not cured or waived, could result in our being required to repay indebtedness before its due date, and we may not have the financial resources or be able to arrange alternative financing to do so. As of August 31, 2004, we were in compliance with all of our covenants under our debt agreements. Borrowings under our senior credit facility are, and borrowings under our amended senior credit facility will

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be, secured by a pledge of stock of certain of our subsidiaries and guaranteed by certain other subsidiaries. If borrowings under our senior credit facility, as currently in effect or as amended in connection with the KCI acquisition, were declared or became due and payable immediately as the result of an event of default and we were unable to repay or refinance those borrowings, the lenders could foreclose on the pledged stock. Any event that requires us to repay any of our debt before it is due could require us to borrow additional amounts at unfavorable borrowing terms, cause a significant decrease in our liquidity, and impair our ability to pay amounts due on our indebtedness. Moreover, if we are required to repay any of our debt before it becomes due, we may be unable to borrow additional amounts or otherwise obtain the cash necessary to repay that debt, and any failure to pay that debt when due could seriously harm our business.

In addition, the indenture governing our 2% convertible senior subordinated debentures and our senior credit facility, as currently in effect and as proposed to be amended, could require us to repurchase or repay the debentures or borrowings outstanding under that credit facility upon the occurrence of a change in control of our company or similar events. In addition, on specified dates in 2010, 2013 and 2018, each holder of our 2% convertible senior subordinated debentures may require us to repurchase all or any of that holder’s debentures at a repurchase price equal to 100% of the principal amount plus accrued interest. We cannot assure you that we will have sufficient funds or will be able to arrange for financing to repurchase or repay our debentures or borrowings under our amended senior credit facility if we are required to do so under the circumstance described above. Like our existing credit facility, we expect that our amended senior credit facility will prohibit the redemption or repurchase of our subordinated indebtedness prior to its stated maturity. If we are required to repurchase or repay any of our 2% convertible senior subordinated debentures or other indebtedness while we are prohibited by our amended senior credit facility or any other agreement from taking this action, we would have to seek the consent of our lenders to purchase or refinance any debentures or other such debt. There can be no assurance that we would be able to obtain such a consent or obtain necessary financing arrangements to purchase or repay those debentures or other indebtedness if required. Our failure to repurchase or repay those debentures or other indebtedness when required would generally constitute an event of default under the related debt instruments, which could constitute a cross default under the terms of our amended senior credit facility and our other debt instruments. In such event, the lenders to our amended senior credit facility and the holders of that other indebtedness generally would be able to declare that indebtedness to be due and payable immediately and, in the case of secured indebtedness, to realize upon the collateral.

Our businesses and KCI’s businesses operate in highly competitive markets, so we may be forced to cut prices or to incur additional costs.

Our businesses and KCI’s businesses generally face substantial competition in each of their respective markets. Competition may force us or KCI to cut prices or to incur additional costs to remain competitive. We and KCI compete on the basis of product design, quality, availability, performance, customer service and price. Present or future competitors may have greater financial, technical or other resources which could put us or KCI at a disadvantage in the affected business or businesses.

Our international operations pose currency and other risks. In particular, a portion of the increase in our net sales for fiscal 2004 was due to the favorable impact of foreign currency exchange rate changes.

Our international operations present special risks, primarily from currency exchange rate fluctuations, exposure to local economic and political conditions, export and import restrictions, controls on repatriation of cash and exposure to local political conditions. In particular, our results of operations have been significantly affected by fluctuations in foreign currency exchange rates. In that regard, our consolidated net sales for fiscal 2004 increased by $141.5 million over fiscal 2003, and approximately $34.4 million of that increase was due to the favorable impact of foreign currency exchange rate changes on translated results, due primarily to the weakness of the U.S. dollar relative to the Euro and certain other currencies. Accordingly, to the extent that the U.S. dollar strengthens relative to the Euro or certain other currencies, it could have an adverse effect on our results of operations.

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We have significant international operations. In that regard, for fiscal 2004, we derived approximately 48% of our net sales from North America, 45% from Europe, 6% from Asia and 1% from South and Latin America. To the extent that we expand our international presence these risks may increase.

Future acquisitions may create transitional challenges.

Our business strategy includes growth through small, strategic acquisitions, although we may from time to time consider larger acquisitions, such as the KCI acquisition. That strategy depends on the availability of suitable acquisition candidates at reasonable prices and our ability to quickly resolve challenges associated with integrating these acquired businesses into our existing business. These challenges include integration of product lines, sales forces and manufacturing facilities as well as decisions regarding divestitures, inventory write-offs and other charges. These challenges also pose risks with respect to employee turnover, disruption in product cycles and the loss of sales momentum. We cannot be certain that we will find suitable acquisition candidates or that we will consistently meet these challenges.

Environmental laws and regulations may result in additional costs.

We and KCI are subject to federal, state, local and foreign laws and regulations governing public and worker health and safety and the indoor and outdoor environment. Any violations of these laws by us or KCI could cause us or KCI to incur unanticipated liabilities that could harm our operating results and cause our or KCI’s business to suffer. Pursuant to such laws, governmental authorities have required us to contribute to the cost of investigating or remediating, or to investigate or remediate, third party as well as currently or previously owned and operated sites. In addition, we provided environmental indemnities in connection with the sale of certain businesses and product lines. Liability as an owner or operator, or as an arranger for the treatment or disposal of hazardous substances, can be joint and several and can be imposed without regard to fault. As of August 31, 2004, we had a reserve of $1.9 million to cover known environmental costs. There is a risk that our costs relating to these matters could be greater than what we currently expect or exceed our insurance coverage, or that additional remediation and compliance obligations could arise which require us to make material expenditures, particularly as a result of the KCI acquisition. In particular, more stringent environmental laws, unanticipated remediation requirements or the discovery of previously unknown conditions could materially harm our financial condition and operating results. We and KCI are also required to comply with various environmental laws and maintain permits, some of which are subject to discretionary renewal from time to time, for many of our and KCI’s businesses, and we could suffer if we are unable to renew existing permits or to obtain any additional permits that we may require.

Any loss of key personnel and the inability to attract and retain qualified employees could have a material adverse impact on our operations.

We are dependent on the continued services of key executives such as Robert C. Arzbaecher, our Chief Executive Officer, Andrew G. Lampereur, our Chief Financial Officer, William S. Blackmore, our Executive Vice President, Engineered Solutions, and Mark E. Goldstein, Executive Vice President, Tools & Supplies. We do not currently have employment agreements with these or any other officers. Following the KCI acquisition, we will also be highly dependent upon the continued services of key managers and employees of each of KCI’s six business units. The departure of key personnel without adequate replacement could severely disrupt our business operations. In addition, the departure of any of the key management of KCI’s six business units after the closing of the KCI acquisition could have a material adverse impact on our business and our integration of KCI into our businesses. Additionally, we and KCI need qualified managers and skilled employees with technical and manufacturing industry experience to operate our respective businesses successfully. From time to time there may be shortages of skilled labor which may make it more difficult and expensive for us and KCI to attract and retain qualified employees. If we and KCI are unable to attract and retain qualified individuals or our respective costs to do so increase significantly, our operations would be materially adversely affected.

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We and KCI may be required to make payments in respect of businesses that we have sold.

We and KCI have sold a number of businesses over the last several years. We and KCI have typically agreed to indemnify the buyers in respect to certain matters relating to the businesses that we and KCI have sold, and we and KCI may from time to time be required to make payments to the buyers under those indemnities. To the extent we and KCI are required to make any similar payments in the future, those payments could be substantial, which could require us to borrow additional amounts at unfavorable borrowing terms and cause a significant decrease in our liquidity, both of which could severely harm our business.

If our and KCI’s intellectual property protection is inadequate, others may be able to use our and KCI’s technologies and tradenames and thereby reduce our and KCI’s ability to compete, which could have a material adverse effect on us, our financial condition and results of operations.

We regard much of the technology underlying our and KCI’s services and products and the trademarks under which we and KCI market our products as proprietary. The steps we take to protect our and KCI’s proprietary technology may be inadequate to prevent misappropriation of our and KCI’s technology, or third parties may develop similar technology independently. We and KCI rely on a combination of patents, trademark, copyright and trade secret laws, employee and third-party non-disclosure agreements and other contracts to establish and protect our and KCI’s technology and other intellectual property rights. The agreements may be breached or terminated, and we may not have adequate remedies for any breach, and existing trade secrets, patent and copyright law afford us limited protection. Policing unauthorized use of our and KCI’s intellectual property is difficult. A third party could copy or otherwise obtain and use our and KCI’s products or technology without authorization.

Litigation may be necessary for us to defend against claims of infringement, to protect our and KCI’s intellectual property rights and could result in substantial cost to us, and diversion of our efforts. Further, we might not prevail in such litigation which could harm our business.

Our and KCI’s products could infringe on the intellectual property of others, which may cause us to engage in costly litigation and, if we are not successful, could cause us to pay substantial damages and prohibit us from selling our and KCI’s products.

Third parties may assert infringement or other intellectual property claims against us or KCI based on their patents or other intellectual property claims, and we may have to pay substantial damages, possibly including treble damages, if it is ultimately determined that they do. We may have to obtain a license to sell our and KCI’s products if it is determined that our or KCI’s products infringe upon another person’s intellectual property. We might be prohibited from selling our and KCI’s products before we obtain a license, which, if available at all, may require us to pay substantial royalties. Even if infringement claims against us are without merit, defending these types of lawsuits takes significant time, may be expensive and may divert management attention from other business concerns.

The conflict in Iraq and any future armed conflict or terrorist activities may cause the economic conditions in the U.S. or abroad to deteriorate, which could harm our business.

The U.S. and other countries are engaged in a war in Iraq and military personnel are still engaged in that country. The duration and outcome of these activities are unknown. Continued occupation of Iraq, future terrorist attacks against targets in the U.S. or abroad, rumors or threats of war, additional conflicts involving the U.S. or its allies or trade disruptions may impact our operations and those of KCI or cause general economic conditions in the U.S. and abroad to deteriorate. A prolonged economic slowdown or recession in the U.S. or in other areas of the world could reduce the demand for our products and those of KCI and, therefore, negatively affect our future sales. Any of these events could have a significant impact on our business, financial condition or results of operations and may result in the volatility of the market price for our common stock.

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In the event we are unable to satisfy regulatory requirements relating to internal controls, or if these internal controls over financial reporting are not effective, our business and our stock price could suffer.

Section 404 of Sarbanes Oxley requires companies to do a comprehensive evaluation of their internal controls. As a result, we are currently performing an evaluation of our internal controls over financial reporting so that our management can certify as to the effectiveness of our internal controls and our auditor can publicly attest to this certification. This certification will also need to encompass the internal controls of KCI, but KCI’s internal controls evaluation is in its early stages. Accordingly, as permitted by the SEC, we currently intend to exclude KCI from our certification under Section 404 of Sarbanes Oxley for a period of up to one year following the acquisition. There may be deficiencies in KCI’s internal accounting system and we may therefore be delayed in detecting them and we may not detect them at all, which could have a material adverse effect on our business. Our efforts to comply with Section 404 and related regulations regarding our management’s required assessment of internal control over financial reporting and our independent auditors’ attestation of that assessment has required, and continues to require, the commitment of significant financial and managerial resources, and we anticipate that the KCI acquisition will require the commitment of further resources, which will be substantial. If we fail to timely complete our current evaluation or the evaluation of KCI, if our management is unable to certify the effectiveness of our internal controls or if our auditors cannot attest to our certification, we could be subject to regulatory scrutiny and a loss of public confidence, which could have a material adverse effect on our business and our stock price.

Large or rapid increases in the costs of raw materials or substantial decreases in their availability could adversely affect our and KCI’s operations.

The primary raw materials that we and KCI use include steel, plastic resin, copper, brass, steel wire and rubber. Most of our and KCI’s suppliers are not currently parties to long-term contracts with us or KCI. Consequently, we and KCI are vulnerable to fluctuations in prices of such raw materials. Market prices for certain materials such as steel, plastic resin and copper have been rising, which could have a negative effect on our and KCI’s operating results and ability to manufacture our respective products on a timely basis. Prior to the announcement of the KCI acquisition, we estimated that increases in raw material prices would have an incremental negative impact on our gross profit of approximately $2-$3 million in fiscal 2005 as compared to fiscal 2004 although we cannot assure you that the actual negative impact will not be higher. The actual negative impact may also be higher than we anticipated because our estimate did not take into account our acquisition of KCI. We have not entered into any derivative contracts to hedge our exposure to commodity risk. Factors such as supply and demand, freight costs and transportation availability, inventory levels, the level of imports and general economic conditions may affect the prices of raw materials that we and KCI need. If we or KCI experience any significant increases in raw material prices, or if we or KCI are unable to pass along any increases in raw material prices to our customers, then our results of operations could be adversely affected.

Risks Related to the Common Stock

The market price for our common stock may be volatile.

The market price of our common stock could fluctuate substantially in the future in response to a number of factors, including those discussed below. The market price of our common stock has in the past fluctuated significantly and is likely to continue to fluctuate significantly. Some of the factors that may cause the price of our common stock to fluctuate include:

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The stock markets in general have experienced substantial price and trading fluctuations. These fluctuations have resulted in volatility in the market prices of securities that often has been unrelated or disproportionate to changes in operating performance. These broad market fluctuations may adversely affect the trading price of the common stock.

The market price of our common stock could be affected by the substantial number of shares that are eligible for future sale.

As of August 31, 2004, we had 23,762,494 shares of common stock outstanding, excluding 1,974,758 shares issuable upon the exercise of outstanding options granted under our existing stock option plans, 674,533 additional shares reserved for issuance under existing stock option plans and employee stock purchase plans, and 3,758,445 shares issuable upon conversion of our 2% convertible senior subordinated debentures. In addition, the number of shares issuable upon conversion of these debentures may increase pursuant to anti-dilution provisions applicable to the debentures. We cannot predict the effect, if any, that future sales of shares of common stock, including common stock issuable upon the exercise of options or the conversion of the 2% convertible senior subordinated debentures, or the availability of shares of common stock for future sale, will have on the market price of our common stock prevailing from time to time.

Our 2% convertible senior subordinated debentures are convertible into common stock, at the option of the holders, only upon the occurrence of certain specified events. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus supplement for a description of those events. Among other things, the debentures may be converted into common stock during any fiscal quarter if the closing sale price of our common stock exceeds approximately $47.89 for at least 20 trading days in the 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter. If holders become entitled to convert their debentures into our common stock, it could result in the issuance of up to 3,758,445 additional shares of common stock, which could be dilutive to other stockholders and adversely affect the market price of our common stock, perhaps substantially.

Based on filings made with the SEC we are aware of three institutions that each hold in excess of 5% of our outstanding common stock. We are not able to predict whether or when any of these institutions will sell substantial amounts of our common stock. Sales of our common stock by these institutions could adversely affect prevailing market prices for our common stock.

We do not intend to pay cash dividends in the foreseeable future.

We currently do not plan to declare or pay cash dividends in the foreseeable future but instead intend to retain cash for working capital needs, acquisitions, if any, and to reduce outstanding debt.

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Some provisions of our charter and bylaws and of Wisconsin law may prevent a change in control or adversely affect our shareholders.

Certain provisions of our articles of incorporation and bylaws and of the Wisconsin Business Corporation Law may discourage, delay or prevent transactions that our shareholders may consider favorable, including transactions that could provide for payment of a premium over the prevailing market price of our common stock, and also may limit the price that investors are willing to pay in the future for shares of our common stock.

For example, our articles of incorporation and bylaws:

In addition, certain sections of the Wisconsin Business Corporation Law may discourage, delay or prevent a change in control by:

See “Description of Capital Stock—Certain Statutory Provisions” in this prospectus supplement.

Any issuance of preferred stock or Class B common stock could adversely affect the holders of our common stock.

Our board of directors is authorized to issue shares of preferred stock or Class B common stock without any action on the part of our shareholders. Our board of directors also has the power, without shareholder approval, to set specified terms of any series of preferred stock, including dividend rates, votes per share and amounts payable in the event of our dissolution, liquidation or winding up. Any preferred stock that we issue may have a preference over our common stock with respect to the payment of dividends and upon our liquidation, dissolution or winding up and the holders of the preferred stock would be entitled to vote as a single class with the holders of our common stock in the election of directors. As a result, our board of directors could issue preferred stock with dividend, liquidation and voting rights and with other terms that could adversely affect the interests of the holders of our common stock. If any shares of Class B common stock are issued, our articles of incorporation provide that the Class B common shareholders, voting as a separate class, would be entitled to elect a majority of our board of directors, while the holders of our common stock, voting as a single class with the holders of any outstanding preferred stock, would be entitled to elect a minority of our board of directors. As a result, the issuance of any Class B common stock would adversely affect the voting rights of holders of our common stock. We do not currently intend to issue any preferred stock or Class B common stock.

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Persons holding our common stock could have the voting power of their shares of common stock on all matters significantly reduced under Wisconsin anti-takeover statutes, if the person holds 20% of the voting power in the election of directors.

Under Section 180.1150(2) of the Wisconsin Business Corporation Law, if a person holds voting power of our company in excess of 20% of the voting power in the election of directors, then that person’s voting power shall be limited (in voting on any matter) to 10% of the full voting power of such excess shares, unless full voting rights have been restored to that person at a special meeting of the shareholders called for that purpose. A person’s common stock holdings as well as any shares issuable upon conversion of convertible securities or the exercise of options or warrants owned by that person are included in calculating such person’s voting power. Therefore, any shares issuable to a holder of our 2% convertible senior subordinated debentures, as well as any shares acquired in this offering, will be included in determining whether such holder holds more than 20% of our voting power. If a holder of common stock holds more than 20% of our outstanding common stock, after taking into account any shares of common stock that the holder acquires in this offering or that the holder would receive upon the exercise or conversion of outstanding options, warrants or 2% convertible senior subordinated debentures, then the holder’s voting power would be significantly reduced under Wisconsin anti-takeover statutes. See “Description of Capital Stock—Certain Statutory Provisions.”

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USE OF PROCEEDS

We expect to receive approximately $115.0 million of net proceeds from the sale of the shares of common stock in this offering (or approximately $132.4 million if the underwriters’ over-allotment option is exercised in full), in each case assuming a public offering price of $48.95 per share (the last reported sale price of the common stock on the New York Stock Exchange on December 14, 2004) and after deducting estimated underwriting discounts and commissions and expenses payable by us in connection with this offering. The closing of this offering is contingent upon the concurrent or prior closing of the KCI acquisition and amendment of our senior credit facility.

We intend to use the proceeds from the new $250 million term loan borrowed under our amended senior credit facility to pay the Cash Portion of the purchase price for KCI and pay related costs and expenses.

We intend to use the net proceeds from this offering, together with the remaining proceeds from the new $250 million term loan, to redeem the KCI senior notes (or, as described below, to repay revolving credit borrowings temporarily incurred for that purpose), reduce our revolving credit and/or commercial paper borrowings and pay related costs and expenses. Pending application for the foregoing purposes, we may use the net proceeds from this offering to temporarily reduce our revolving credit and/or commercial paper borrowings. Revolving credit borrowings that we repay may be reborrowed, subject to customary conditions under our senior credit facility. We may also make additional commercial paper borrowings in the future, subject to market and other conditions.

We expect that the bank lenders under our amended senior credit facility will require that, concurrently with the closing of the KCI acquisition, we make an irrevocable cash deposit with the trustee for the KCI senior notes in an amount equal to the anticipated redemption price of the KCI senior notes, which deposit will be held by the trustee and applied to redeem the KCI senior notes on the applicable redemption date in January 2005. We sometimes refer to this anticipated cash deposit as the “Redemption Deposit”. If the KCI acquisition closes prior to the closing of this offering, we anticipate that we will finance the Redemption Deposit with revolving credit borrowings under our amended senior credit facility and that we will repay those borrowings with a portion of the proceeds from this offering. If the KCI acquisition closes concurrently with the closing of this offering, we anticipate that we will finance the Redemption Deposit with a portion of the proceeds from this offering. To the extent that we initially finance the Redemption Deposit with revolving credit borrowings, we anticipate that those borrowings will be outstanding only temporarily. Accordingly, we have not reflected those possible revolving credit borrowings in the following table or in the pro forma financial data, pro forma financial statements or other similar information appearing elsewhere in this prospectus supplement.

The following table sets forth the estimated sources and uses of funds relating to the Transactions assuming that all of the Transactions were completed on August 31, 2004 (dollars in millions):

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CAPITALIZATION

The following table sets forth our capitalization (including current portion of long-term debt) as of August 31, 2004 (1) on an actual basis and (2) on a pro forma basis to reflect the following transactions as if they had occurred on that date:

The following table does not reflect any revolving credit borrowings that we may be required to make to temporarily finance the Redemption Deposit as described under “Use of Proceeds.”

You should read the following table in conjunction with “Prospectus Supplement Summary—Acquisition Financing and Related Transactions,” “Use of Proceeds,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our and KCI’s consolidated financial statements and related notes and “Unaudited Pro Forma Condensed Consolidated Financial Statements” included elsewhere in this prospectus supplement or incorporated by reference into this prospectus supplement. The following pro forma data is based upon a number of assumptions and estimates, is subject to uncertainties and does not purport to be indicative of the actual capitalization that would have resulted had the transactions described above in fact occurred on the date indicated, nor does it purport to be indicative of our future capitalization.

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