Tender-Offer Statement — Third-Party Tender Offer — Schedule TO
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SC TO-T Schedule to 6 33K
2: EX-99.A.1.A Offer to Purchase 46 249K
3: EX-99.A.1.B Letter of Transmittal 10 56K
4: EX-99.A.1.C Letter to Participants 7 33K
5: EX-99.A.1.D Notice of Guaranteed Delivery 3 15K
6: EX-99.A.1.E Letter to Broker, Dealers 2 15K
7: EX-99.A.1.F Letter to Clients 3 17K
8: EX-99.A.1.G Tax Guidlines on Form W-9 4± 18K
9: EX-99.A.1.H Summary Advertisement 5 27K
10: EX-99.A.1.I Press Release 8 26K
11: EX-99.B Credit Agreement 113 313K
12: EX-99.D.1 Agreement for Tender Offer and Merger 51 195K
13: EX-99.D.2 Shareholders' Agreement 11 36K
14: EX-99.D.3 Confidentiality Agreement 4 21K
The following press release has been published by the filing persons on June 25,
2001:
THE DESCRIPTION CONTAINED IN THIS PRESS RELEASE IS NEITHER AN OFFER TO PURCHASE
NOR A SOLICITATION OF AN OFFER TO SELL SHARES OF SUNQUEST. AT THE TIME THE
TENDER OFFER IS COMMENCED, MISYS WILL FILE A TENDER OFFER STATEMENT AND SUNQUEST
WILL FILE A SOLICITATION/RECOMMENDATION STATEMENT WITH RESPECT TO THE OFFER. THE
TENDER OFFER STATEMENT (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF
TRANSMITTAL AND OTHER OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION WILL
CONTAIN IMPORTANT INFORMATION THAT SHOULD BE READ CAREFULLY BY SUNQUEST'S
SHAREHOLDERS BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER. THE OFFER TO
PURCHASE, THE RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER DOCUMENTS, AS WELL
AS THE SOLICITATION/RECOMMENDATION STATEMENT, WILL BE MADE AVAILABLE TO ALL
SHAREHOLDERS OF SUNQUEST, AT NO EXPENSE TO THEM. THESE DOCUMENTS WILL ALSO BE
AVAILABLE AT NO CHARGE AT THE SEC'S WEBSITE AT WWW.SEC.GOV.
[PRESS RELEASE]
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED
STATES, CANADA, AUSTRALIA, SOUTH AFRICA, THE REPUBLIC OF IRELAND OR JAPAN.
25 JUNE 2001
ACQUISITION OF SUNQUEST INFORMATION SYSTEMS INC. ("SUNQUEST")
BY
MISYS PLC ("MISYS")
o Misys announces that it has agreed to acquire Sunquest, a market leading
provider of clinical systems to hospitals and other acute care facilities in
the US.
o Misys will make a cash tender offer for all of Sunquest's shares at $24 per
share, valuing Sunquest at approximately $404 million. Shareholders holding
approximately 76 per cent. of Sunquest's outstanding shares have committed
to tender their shares.
o The acquisition of Sunquest consolidates Misys' position as a leader in US
healthcare IT and expands Misys' presence into acute care.
o Sunquest is strongly positioned to benefit from the expected growth in
clinical systems and adds a further dimension to Misys' strength in
electronic medical records.
o The acquisition is expected to be earnings enhancing (stated before goodwill
amortisation and any exceptional costs) in the year ending 31 May 2002*.
Kevin Lomax, Chairman of Misys, stated:
"The acquisition of Sunquest consolidates Misys' position as a leading provider
of healthcare information systems, extending Misys' presence into the acute care
market making it well placed to exploit the expected growth in clinical systems.
The combination of Medic's leading position in physician practice management
systems and Sunquest's strengths in the clinical environment will have broad
capabilities to meet US healthcare providers' increasing requirements for
information systems which improve efficiency and enhance patient care."
Dr Sidney Goldblatt, Chairman of Sunquest, stated:
"Sunquest's fit with Misys, a larger and more diverse company, is an excellent
one. The acquisition of Sunquest by Misys should foster the continued success
and growth of Sunquest and provide an excellent environment to preserve the
culture of the company, including its strong service ethic. We believe the
various stakeholders in the company - shareholders, customers and employees -
will applaud this event."
ENQUIRIES:
MISYS PLC +44 (0) 20 7368 2300
Kevin Lomax
Alastair Macdonald
DRESDNER KLEINWORT WASSERSTEIN LIMITED +44 (0) 20 7623 8000
David Barclay
Guy Davis
Dresdner Kleinwort Wasserstein Limited, which is regulated in the United Kingdom
by the Securities and Futures Authority Limited, is acting exclusively for Misys
and for no one else in connection with the transaction and will not be
responsible to anyone other than Misys for providing the protections afforded to
customers of Dresdner Kleinwort Wasserstein Limited nor for providing advice in
relation to the transaction and any related matters.
THE ACQUISITION
Misys, one of the UK's leading independent software groups, today announces that
it has signed an acquisition agreement pursuant to which it intends to make a
cash tender offer for Sunquest, a leading supplier of clinical systems to US
hospitals. The tender offer of $24 per Sunquest share for the entire issued and
to be issued share capital of Sunquest (NASDAQ: SUNQ) values the company at
approximately $404 million (net of option proceeds) and represents a premium of
approximately 63 per cent. to the Sunquest closing price of $14.74 on Friday 22
June 2001. The members of the Sunquest Board have unanimously recommended the
tender offer. Certain shareholders representing approximately 76 per cent. of
the existing issued ordinary share capital have committed to tender their
holdings.
The acquisition will be implemented by way of a tender offer to be made by Misys
for all of the Sunquest shares. Completion of the tender offer is subject to a
number of customary conditions and the valid tender of at least 80 per cent. of
the fully diluted Sunquest shares. Sunquest shareholders holding approximately
76 per cent. of the existing issued ordinary Sunquest shares have entered into
shareholder's agreements with Misys that commit those shareholders to tender
their shares and grant Misys the right to buy their shares in certain
circumstances. Misys expects to commence the tender offer by early July 2001.
The tender offer is expected to be completed in August 2001.
OVERVIEW OF SUNQUEST
Sunquest is a market leading provider of clinical systems to hospitals and other
acute care facilities in the US. Sunquest's clinical suite of products, which
comprises systems for the ancillary departments of acute care facilities
(Laboratory, Radiology and Pharmacy) are installed in some 1,200 sites across
the country including many leading hospitals in the US. Sunquest was co-founded
in 1979 by Dr Sidney Goldblatt as a provider of Laboratory Information Systems
and today is a market leader with over 1,000 installations, including 45 per
cent. of all Integrated Delivery Networks ("IDNs") in the US and approximately
26 per cent. of all hospitals in the US with over 250 beds. Over the past five
years, Sunquest has expanded its product range to offer a full clinical suite of
Laboratory, Radiology and Pharmacy systems to its customers, and has
consistently been rated as a top vendor to these segments in client surveys.
Sunquest is based in Tucson, Arizona and employs over 900 people.
In the year ended 31 December 2000, Sunquest reported revenues of $120.6
million, operating income of $17.2 million, income before tax of $20.1 million
and net income of $13.4 million . The total shareholders' equity of the business
was $100.6 million as at 31 March 2001, including cash and short term
investments (less capital lease obligations) of $65.0 million.
In 2000 Sunquest reported its results in two segments: the Core Business
segment, providing clinical systems and services; and the e-Commerce segment,
providing Internet-based products including ASP products. The Core Business
segment showed strong operating income growth for the year ended 31 December
2000, with operating income rising to $26.3 million, an 11 per cent. increase
over 1999. Growth has continued in this segment in the first three months of
2001 with operating income rising to $6.5 million, an increase of 51 per cent.
as compared with the first quarter of 2000, which was adversely impacted by the
millennium slow down effect. In the year ended 31 December 2000, the e-Commerce
segment reported an operating loss of $9.1 million and, for the first three
months of 2001, this segment reported an operating loss of $3.6 million.
BACKGROUND TO AND REASONS FOR THE ACQUISITION
US healthcare IT expenditure is recovering strongly following its decline in
2000. Growth in software expenditure of approximately 13 per cent. annually to
2006 is projected by Dataquest, as US healthcare providers, who have
historically under-invested in IT, respond to the challenges of reducing
inefficiency and improving the standards and quality of care through IT
investment. The requirements of recent US government legislation, in the form of
the Health Insurance Portability and Accountability Act, and the benefits
offered by Internet-based information systems are expected to be further drivers
of US healthcare industry investment in IT.
Misys has a leading position in the US healthcare information systems market
through Medic, which provides information systems at over 18,000 customer sites
throughout the US. Medic's products and services include physician practice
management software, electronic medical records systems, transaction processing
and home healthcare products.
The acquisition of Sunquest consolidates Misys' position as a leader in US
Healthcare IT and extends Misys' presence into the acute care market, which
according to Dataquest represented 32 per cent. of total US healthcare
expenditures in 2000. The acquisition should allow Misys to benefit from the
current and expected future growth in clinical systems and adds a further
dimension to Misys' strength in electronic medical records and electronic
transactions processing, both of which are areas of growing importance in
healthcare management. The combined entity will supply systems to some 1,200
hospitals, 85,000 physicians and 700 home healthcare agencies in the US and will
employ over 2,300 people.
MANAGEMENT
Tom Skelton, Medic's CEO, will take overall charge of Misys' enlarged healthcare
information systems division following the acquisition. Dr Sidney Goldblatt,
Sunquest's co-founder, chairman and CEO, will relinquish his executive
responsibilities following completion but will maintain a close relationship
with the business. The Sunquest operational management will continue in their
existing roles, reporting to Tom Skelton. As is Misys' usual practice,
appropriate incentive arrangements will be put in place for Sunquest's
management team.
FINANCING AND FINANCIAL EFFECTS
The acquisition is being funded from Misys' existing resources and a new medium
term loan facility. The acquisition is expected to be earnings enhancing (before
goodwill amortisation and any exceptional costs) in the year ending 31 May 2002*
and to earn a return on investment in excess of Misys' cost of capital by the
third year of ownership.
After taking account of the proposed acquisition of Sunquest and the proposed
acquisition of DBS Management plc ("DBS") announced on 19 June 2001, the pro
forma net debt of the Misys Group as at 30 November 2000 would have been
(pound)338.8 million (on the basis described in Notes to Editors below).
* This statement should not be construed as a profit forecast or be interpreted
to mean that the future earnings per share of Misys will be greater than the
earnings per share of Misys for the financial year ended 31 May 2001.
ENQUIRIES:
MISYS PLC +44 (0) 20 7368 2300
Kevin Lomax
Alastair Macdonald
DRESDNER KLEINWORT WASSERSTEIN LIMITED +44 (0) 20 7623 8000
David Barclay
Guy Davis
Dresdner Kleinwort Wasserstein Limited, which is regulated in the United Kingdom
by the Securities and Futures Authority Limited, is acting exclusively for Misys
and for no one else in connection with the transaction and will not be
responsible to anyone other than Misys for providing the protections afforded to
customers of Dresdner Kleinwort Wasserstein Limited nor for providing advice in
relation to the transaction and any related matters.
NOTES FOR EDITORS
SUNQUEST
Sunquest divides its operations into two business segments: Core Business and
e-Commerce. Sunquest's Core Business segment consists of its clinical systems
that include software licenses, related hardware, re-licensed software, re-sold
software and value-added services all focused on Laboratory, Radiology and
Pharmacy systems. Sunquest reported Core Business segment revenues of $120.5
million and operating income of $26.3 million for the year ended 31 December
2000. Core Business segment revenues and operating profit were $31.7 million and
$6.5 million respectively for the three months ended 31 March 2001 compared to
revenues of $28.7m and operating income of $ 4.3m in the three months ended 31
March 2000.
Sunquest's e-Commerce segment consists of its ASP and Internet products and
web-based development. Sunquest reported e-Commerce segment revenues of $0.2
million and operating loss of $9.1 million for the year ended 31 December 2000.
The e-Commerce segment revenues and operating loss were $0.1 million and $3.6
million respectively for the three months ended 31 March 2001 compared to
segment revenues of zero and operating loss of $0.7m for the three months ended
31 March 2000.
MISYS
Misys is one of the world's leading applications software products companies.
Misys develops and licenses a variety of application software products to
customers in the international banking and securities, US healthcare, and UK
retail financial services sectors. The group aims to partner with its customers
to improve business processes through the development, integration and delivery
of industry specific IT solutions.
For the year ended 31 May 2000, Misys reported revenues of approximately
(pound)709 million and an adjusted operating profit of approximately (pound)130
million. For the six months ended 30 November 2000, Misys reported revenues of
approximately (pound)413 million and an adjusted operating profit of
approximately (pound)66 million.
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Misys' healthcare division is a leading vendor of IT and related services to the
US healthcare market and one of the top three suppliers to physicians, with over
85,000 physicians at 18,000 sites. Misys' IT solutions enable physicians to run
their practices more efficiently and, therefore, offer higher levels of care to
their patients. Medic has its headquarters in Raleigh, North Carolina and
employs approximately 1,400 people in the US. For the year ended 31 May 2000,
Medic reported revenues of approximately (pound)181 million and an adjusted
operating profit of approximately (pound)31 million. For the six months ended 30
November 2000, Medic reported revenues of approximately (pound)94 million and an
adjusted operating profit of approximately (pound)17 million.
Medic's strong focus on its R&D programme has strengthened the Misys healthcare
product portfolio considerably and the new developments position the division
well for continued growth. Sunquest's comprehensive range of products and
services will assist in further improving Misys' share of the healthcare markets
addressed.
Misys' pro forma net debt as at 30 November 2000 of (pound)338.8 million is
based on Misys' net debt as at 30 November 2000 of (pound)44.8 million, DBS's
net cash as at 31 March 2001 of (pound)21.0 million, Sunquest's net cash and
short term investments of $65.0 million ((pound)46.0 million) as at 31 March
2001, the cash consideration payable for DBS's existing issued share capital of
(pound)74.9 million, the cash consideration payable for Sunquest's issued share
capital of $374.1 million ((pound)264.8 million), the net cost of acquiring
outstanding options over DBS shares of (pound)0.1 million and the net cost of
acquiring outstanding options over Sunquest shares of $29.9 million ((pound)21.2
million).
(US Dollars have been translated to Pounds Sterling using an Exchange rate of
(pound)1 Sterling:USD$1.4128)
Dates Referenced Herein and Documents Incorporated by Reference
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