<PAGE> 1
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 10, 1999
METAMOR WORLDWIDE, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-26970 76-0407849
(Commission File Number) (I.R.S. Employer Identification No.)
FIVE POST OAK PARK
4400 POST OAK PARKWAY, SUITE 1100
HOUSTON, TEXAS 77027-3413
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 548-3400
===============================================================================
<PAGE> 2
ITEM 5. OTHER EVENTS
On January 10, 1999, Metamor Worldwide, Inc.
(the "Company") entered into an Agreement and Plan of Reorganization with SPR
Inc. ("SPR"). The transaction will be structured as a tax-free merger and
accounted for as a pooling-of-interest. Each share of SPR's common stock will be
exchanged for 0.8 of a share of the Company's common stock. The merger, subject
to regulatory and shareholder approvals, is expected to close in April 1999.
In addition, the Company has rescinded its stock repurchase
program.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Press release issued January 11, 1999.
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned hereunto duly authorized.
METAMOR WORLDWIDE, INC.
(Registrant)
Dated: January 15, 1999 By: /s/ Edward L. Pierce
--------------------------------------
Edward L. Pierce
Chief Financial Officer, Senior Vice
President and Assistant Secretary
<PAGE> 3
INDEX TO EXHIBITS
Exhibit No. Description
----------- -----------
99.1 Press release issued January 11, 1999.
<PAGE> 1
[LETTERHEAD METAMOR WORLDWIDE]
FOR FURTHER INFORMATION:
AT METAMOR WORLDWIDE, INC.: AT SPR INC.:
Edward Pierce, CFO Stephen Tober, COO
Kyle Leak, Investor Relations Leslie Bedford, Investor Relations
713-548-3400 630-575-6200
AT THE FINANCIAL RELATIONS BOARD:
Marilyn Windsor Janine Warell Darcy Bretz
General Inquiries Analyst Inquiries Media Inquiries
312-640-6692 312-640-6775 312-640-6756
FOR IMMEDIATE RELEASE
MONDAY, JANUARY 11, 1999
METAMOR WORLDWIDE, INC. AND SPR INC. TO MERGE
Merger Expands Metamor's Solutions Offerings
HOUSTON, January 11, 1999-Metamor Worldwide, Inc. (Nasdaq: MMWW), one of the
leading providers of information technology (IT) services, and SPR Inc.
(Nasdaq: SPRI), a leading IT services corporation providing innovative solutions
to Fortune 1000 companies, today announced that they will merge to form a global
IT solutions and services company with one of the most comprehensive service
offerings in the industry. The merger is expected to be accretive to Metamor's
1999 earnings per share.
The transaction will be structured as a pooling-of-interest, tax-free merger.
Each share of SPR's common stock will be exchanged for 0.8 of a share of
Metamor's common stock. Following the combination, Metamor's dilutive common
shares and equivalents will total approximately 50.6 million, of which 23
percent will be held by SPR's stockholders. The merger is subject to
regulatory and shareholder approvals. Closing is expected in April 1999,
following the votes of each company's shareholders.
The combined company will be one of the nation's largest IT solutions and
services providers, employing approximately 8,200 consultants in 73 offices and
21 development centers. The combined company expects to generate 1999 revenues
of over $1.25 billion.
<PAGE> 2
Metamor Worldwide, Inc.
Add -1-
Rob Figliulo, SPR's chairman and chief executive officer, will join Metamor's
board of directors after the merger is completed. All of the members of SPR's
Executive Operating Committee and management will become part of the management
team of the combined company. In addition, all of the members of SPR's
Executive Operating Committee have granted Metamor a proxy to vote in favor of
the merger and, under certain circumstances, an option to purchase shares
representing approximately 22 percent of the outstanding shares of SPR's common
stock.
This strategic merger with SPR will broaden Metamor's service offerings by
creating a vertical practice group focused on the mainframe and its emerging
role with new technologies such as data warehousing, Internet/intranet and
electronic commerce. In addition, the combination will permit Metamor to
compete for mainframe outsourcing assignments. Metamor believes it will be
able to scale SPR's established and unique operating model into major
metropolitan markets where Metamor has strong market position, customer
relationships and existing infrastructure.
Michael T. Willis, Metamor's chairman and chief executive officer, said,
"Our strategic merger with SPR is an important step in expanding our service
offerings. Through this merger, we gain additional project-based management and
resources that will allow Metamor to provide value-added outsourcing solutions
to customers using mainframe technologies."
According to industry sources, the IT outsourcing market was estimated at $173
billion in 1998 and will achieve a 16 percent compound annual growth rate
through 2000.
Willis further stated, "The more corporate America does business over the
Internet, the more it becomes necessary to link the mainframe to the web. SPR's
mainframe clientele has an immediate need to connect their mainframe
environments to newer technologies. Because Metamor has extensive e-commerce
and Internet capabilities, the combined companies can now provide complete
solutions to all of their customers."
"The mainframe computer is in the early stages of a renaissance,"
Figliulo stated. "This merger gives us a unique position to drive IT solutions
that maximize our clients' significant mainframe investments. We will continue
to offer our customers proven expertise in mainframe services, as well as tap
into other Metamor divisions to provide a broader range and greater depth of IT
services. We can now say 'yes' to the full range of our clients' IT needs
beyond mainframe services and we can do it backed by the distinction and power
of Metamor's resources."
Figliulo continued, "In addition, because Metamor is a global operation, we
will be able to serve our customers' mainframe technology needs both
domestically and through Metamor's four offshore development centers, offering
customers a truly international scope of services."
Metamor also announced that, in connection with this transaction, it has
rescinded its stock repurchase program.
Metamor Worldwide, a diversified global IT solutions and services provider,
offers customers project management and project delivery capabilities for a
broad range of technology solutions including Internet and Web-enabled
applications, custom application development, data warehousing, ERP
package implementation, systems integration, software engineering, application
support and training. With IT professionals and development centers located
domestically and abroad, Metamor Worldwide's flexible delivery of value-added
<PAGE> 3
Metamor Worldwide, Inc.
Add -2-
services is provided through a combination of geographic presence, industry
focus and specialized technology practices.
Founded in 1973 and headquartered in the Chicago area, SPR Inc. provides
Fortune 1000 companies with IT services including general consulting as well
as five outsourcing services: software modernization, mass change, application
management, information delivery and software quality services. SPR's
outsourcing services help customers derive maximum value from their existing
IT investments with comprehensive solutions for maintaining, improving and
transitioning legacy systems. In September 1998, SPR was named to "The Fast
Fifty" list of America's fastest growing small cap companies published by
Individual Investors Group, Inc. SPR has offices in Oak Brook, IL., Dallas,
Milwaukee and Tulsa.
Except for historical information, all of the statements, expectations and
assumptions contained in the foregoing are forward-looking statements that
involve a number of risks and uncertainties. Although the companies have used
their best efforts to be accurate in making those forward-looking statements, it
is possible that the assumptions made by management may not materialize. In
addition, the information set forth in each of the companies' Form 10-K for the
fiscal year ended December 31, 1997 and Form 10-Q for the fiscal quarter ended
September 30, 1998, describes certain additional risks and uncertainties that
could cause actual results to vary materially from the results covered in such
forward-looking statements.
For further information regarding Metamor Worldwide, Inc. free of charge
via fax, dial 1-800-PRO-INFO and enter "MMWW."
Metamor Worldwide, Inc. can be reached on the Internet at www.metamor.com
---------------
SPR Inc. can be reached on the Internet at www.sprinc.com
--------------
FINANCIAL TABLE TO FOLLOW. . .
<PAGE> 4
Metamor Worldwide, Inc. and Subsidiaries
Summary Historical and Pro Forma Consolidated Financial Data (unaudited)
Nine Months Ended September 30, 1998 and 1997
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Pro Forma For SPR Inc.
Historical Merger (1)
--------------------------------- ----------------------------------
1998 1997 1998 1997
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Revenues $620,169 $373,719 $682,984 $410,621
Gross profit 204,615 106,407 230,488 120,990
EBITDA 69,086 33,049 81,850 37,291
Operating income 56,587 27,516 67,553 31,442
Interest (expense) and other (11,527) (6,045) (10,031) (6,197)
--------------- --------------- --------------- ---------------
Income before income taxes 45,060 21,471 57,522 25,245
Income from continuing operations 26,133 12,451 33,610 14,716
Income from discontinued operations 22,691 9,245 22,691 9,245
--------------- --------------- --------------- ---------------
Net income $48,824 $21,696 $ 56,301 $23,961
=============== =============== =============== ===============
Earnings per share (diluted):
Income from continuing operations $ 0.78 $ 0.38 $ 0.76 $ 0.36
Discontinued operations 0.61 0.29 0.46 0.23
--------------- --------------- --------------- ---------------
Net income $ 1.39 $ 0.67 $ 1.22 $ 0.59
=============== =============== =============== ===============
Number of shares used to calculated EPS 38,806 32,558 49,599 40,606
=============== =============== =============== ===============
Margins:
Gross 33.0% 28.5% 33.7% 29.5%
EBITDA 11.1% 8.8% 12.0% 9.1%
Operating 9.1% 7.4% 9.9% 7.7%
</TABLE>
September 30, 1998
---------------------------------
--------------- ---------------
Historical Pro Forma
--------------- ---------------
Balance Sheet Data:
Cash and cash equivalents $60,539 $65,921
Short-term marketable securities 43,440
-
Long-term debt 193,935 193,935
Stockholders' equity 331,973 390,180
(1) The pro forma data adjusts the historical operating results of Metamor
Worldwide, Inc. to give effect to the merger of SPR Inc. as if the acquisition
had been consummated as of the beginning of the periods presented. The
estimated merger costs of $8.0 million are not included in costs and expenses,
but will be recognized as incurred.
-30-
