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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 1 to SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION
14(d)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
and
Amendment No. 3 to
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
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STERIGENICS INTERNATIONAL, INC.
(Name of Subject Company)
ION BEAM APPLICATIONS S.A.
IBA ACQUISITION CORP.
(Bidders)
Common Stock, Par Value $0.001 Per Share
And The Associated Rights To Purchase
Series A Junior Participating Preferred Stock,
Par Value $0.001 Per Share
(Title of Class of Securities)
85915R 10 5
(CUSIP Number of Class of Securities)
Mr. Pierre Mottet
Ion Beam Applications s.a.
Chemin du Cyclotron, 3
B-1348 Louvain-la-Neuve
Belgium
(011-32-10-47-5855)
(Name, Address and Telephone Number of Person Authorizing to Receive Notices
and Communications on Behalf of Bidder)
Copies To:
Ramon P. Marks, Esq.
Kevin T. Collins, Esq.
Dorsey & Whitney LLP
250 Park Avenue
New York, New York 10177
(212) 415-9200
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<PAGE>
This Amendment No. 1 amends and supplements the Tender Offer Statement on
Schedule 14D-1 filed with the Securities and Exchange Commission on June 17,
1999 ("Schedule 14D-1"). Ion Beam Applications s.a., a Belgian corporation
("IBA") and IBA Acquisition Corp., a Delaware corporation ("Acquisition"), in
connection with the offer to purchase all the outstanding shares of common
stock, par value $0.001 per share, and the associated rights to purchase Series
A Junior Participating Preferred Stock, par value $0.001 per share, of
SteriGenics International, Inc., a Delaware corporation (the "Company"), at a
price of $27.00 per share, net to the tendering stockholder in cash, upon the
terms and subject to the conditions set forth in the Offer to Purchase, dated as
of June 17, 1999 (the "Offer to Purchase"), and the related Letter of
Transmittal (which together constitute the "Offer").
Item 2. Identity and Background
The first sentence of Item 2 of the Schedule 14D-1 is hereby amended and
restated in its entirety as follows:
(a)-(d), (g) This Statement is filed by Purchaser, IBA and Belgabeam SCRL.
Item 9. Financial Statements of Certain Bidders
Item 9 of the Schedule 14D-1 is hereby amended and restated in its entirety
as follows:
Financial Information for Parent
Set forth below is consolidated financial information with respect to
Parent and its consolidated subsidiaries for the fiscal years ended December 31,
1998, December 31, 1997 and December 31, 1996. These consolidated financial
statements of Parent have been prepared on the basis of accounting principles
generally accepted in Belgium ("Belgian GAAP"), which differ in certain material
respects from generally accepted accounting principles in the United States ("US
GAAP"). Also set forth below is a summary of certain significant differences
between Belgian GAAP and US GAAP. Such differences include, but are not limited
to, the accounting for goodwill and other intangibles, which are written off
against retained earnings under Belgian GAAP, but are required to be recorded as
an asset and amortized as a reduction of earnings over their estimated useful
lives, not to exceed 40 years, for purposes of US GAAP.
ION BEAM APPLICATIONS s.a.
CONSOLIDATED FINANCIAL INFORMATION
(In thousands of Belgian Francs, except per share data)
<TABLE>
<CAPTION>
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Years Ended
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December 31, December 31, December 31,
1998 1997 1996
-------------------------------------------------
(1,000's BEF) (1,000's BEF) (1,000's BEF)
<S> <C> <C> <C>
CONSOLIDATED ACCOUNTS*
ASSETS
FIXED ASSETS ...................................................... 472,272 361,111 366,254
-------------------------------------------------
I. Formation expenses ..........................................
II. Intangible assets ........................................... 257,940 210,829 216,309
III. Tangible assets ............................................. 201,262 150,211 149,915
A. Land and buildings ...................................... 47,603 9,176 10,118
B. Plant, machinery and equipment .......................... 26,525 8,438 14,758
C. Furniture and vehicles .................................. 21,722 21,292 8,183
D. Leasing and other similar rights ........................ 105,412 111,154 116,856
E. Assets under construction and advance payments .......... 151 0
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Years Ended
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December 31, December 31, December 31,
1998 1997 1996
-------------------------------------------------
(1,000's BEF) (1,000's BEF) (1,000's BEF)
<S> <C> <C> <C>
IV. Financial assets ............................................ 13,070 71 30
A. Shares
B. Amounts receivable and cash guarantees ............. 13,070 71 30
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CURRENT ASSETS .................................................... 3,486,726 2,039,633 1,023,218
-----------------------------------------------
VI. Stock and contracts in progress ............................. 771,079 354,228 584,800
A. Stocks .................................................. 174,726 50,646 36,985
1. Raw materials and consumables ...................... 78,663 32,099 28,762
2. Work in progress ................................... 84,128 16,849 3,995
3. Finished goods ..................................... 11,935 1,698 4,228
B. Contracts in progress ................................... 596,353 303,582 547,815
VII. Amounts receivable within one year .......................... 592,897 562,595 256,091
A. Trade debtors ........................................... 562,201 507,333 210,228
B. Other amounts receivable ................................ 30,696 55,262 45,863
VIII. Investments ................................................. 2,006,209 1,101,366 166,047
A. Own shares
B. Other investments and deposits .......................... 2,006,209 1,101,366 166,047
IX. Cash at bank and in hand .................................... 48,016 7,531 8,039
X. Deferred charges and accrued income ......................... 68,525 13,913 2,235
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TOTAL ASSETS ...................................................... 3,958,998 2,400,744 1,389,472
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LIABILITIES
CAPITAL............................................................ 1,020,466 218,056 210,164
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I. Capital ..................................................... 922,067 195,138 183,709
A. Issued capital .......................................... 922,067 195,138 183,709
II. Share premium account ....................................... 432 432
IV. Reserves .................................................... 94,409 16,409 9,800
A. Legal reserve ........................................... 8,213 1,604
B. Untaxed reserves ........................................ 8,196 8,196
C. Consolidated reserves .................................. 94,409 2,340
V. Accumulated profit/loss ..................................... 2,518 7,885
VI. Investment grants ........................................... 3,558 3,559 8,770
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PROVISIONS AND POSTPONED TAXES .................................... 212,999 212,259 50,869
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VII. A. Provisions for liabilities and charges .................. 206,701 212,259 50,869
1 . Pensions and similar obligations ................... 2,945 1,200
2 . Other liabilities and charges ...................... 203,756 211,059 50,869
B. Postponed taxes ......................................... 6,298
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AMOUNTS PAYABLE ................................................... 2,725,533 1,970,429 1,128,439
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VIII. Amounts payable after one year .............................. 1,776,074 1,011,983 333,037
A. Financial debts ......................................... 94,087 91,706 96,249
1. Leasing and other similar rights ................... 87,320 91,706 96,249
2. Credit institutions ................................ 2,650
3. Other loans ........................................ 4,117
B. Advances received on contracts in progress .............. 1,536,000 723,239 39
C. Other amounts payable ................................... 145,987 197,038 236,749
IX. Amounts payable within one year ............................. 861,375 911,366 764,117
A. Current portion of debts after one year ................. 92,669 64,626 20,431
B. Financial debts ......................................... 13,694
1. Credit institutions ................................ 13,694
C. Trade debts ............................................. 264,187 254,136 189,203
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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Years Ended
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December 31, December 31, December 31,
1998 1997 1996
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(1,000's BEF) (1,000's BEF) (1,000's BEF)
<S> <C> <C> <C>
1. Suppliers .......................................... 264,187 254,136 189,203
D. Advances received on contracts in progress ............... 413,478 418,374 508,271
E. Taxes, remuneration and social security .................. 70,756 51,180 46,212
1. Taxes .............................................. 27,734 8,670 6,580
2. Remuneration and social security ................... 43,022 42,510 39,632
F. Other amounts payable ................................... 6,591 123,050
X. Accrued charges and deferred income ......................... 88,084 47,080 31,285
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TOTAL LIABILITIES ................................................. 3,958,998 2,400,744 1,389,472
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INCOME STATEMENT
I. Operating income ............................................ 1,742,936 1,249,558 796,874
A. Turnover ................................................ 1,236,484 1,327,148 532,341
B. Increase (+); decrease(-) in stocks of finished goods,
work and contracts in progress .................. 345,862 -233,909 185,073
C. Fixed assets - own construction ......................... 145,845 73,314 76,790
D. Other operating income .................................. 14,745 83,005 2,670
II. Operating charges (-) ......................................... -1,535,673 -1,137,543 -730,166
A. Raw materials, consumables and goods for resale 619,563 431,544 294,383
1. Purchases .......................................... 620,335 434,881 294,916
2. Increase, decrease in stocks (-,+) ................. -772 -3,337 -533
B. Services and other goods ................................ 282,298 211,750 140,945
C. Remunerations and social security costs,
Pensions .............................................. 316,909 212,614 187,003
D. Depreciation of and other amounts written off ........... 139,031 109,369 90,200
E. Provisions for liabilities and charges .................. -22,597 161,390 10,823
F. Other operating charges ................................. 1,608 10,876 1,893
G Amortization goodwill ................................... 198,861
III. Operating profit (+) ........................................ 207,263 112,015 66,708
Operating loss (-) ..........................................
IV. Financial income ............................................ 374,844 77,287 20,649
A. Income from financial fixed assets ...................... 8,559
B. Income from current assets .............................. 291,819 33,074 1,480
C. Other financial income .................................. 74,466 44,213 19,169
V. Financial charges (-) ....................................... -325,999 -65,010 -49,972
A. Debt charges ............................................ 267,258 22,192 15,306
B. Amounts written off on current assets ...................
other than those mentioned in II.E ( +, - ) ................. 30 1,283 4,103
C. Other financial charges ................................. 58,711 41,535 30,563
VI. Current profit before taxes ................................... 256,108 124,292 37,385
VIII Extraordinary charges (-) ................................... -42,193
A. Other extraordinary charges ............................. 42,193
IX. Profit for the period before taxes (+) ...................... 213,915 124,292 37,385
IX. A. Transfer from postponed taxes ........................... 78
X. Income taxes (-) (+) ........................................ -138,025
A. Income taxes (-) ........................................ 138,025
XI. Profit for the period (+) ................................... 75,812 124,292 37,385
</TABLE>
<PAGE>
Analysis of the Results
Following acquisition of Mediflash on December 22, 1998, IBA established its
first consolidated accounts in addition to its regular company accounts. These
integrate the accounts of IBA and only the 4th quarter accounts of Mediflash.
They have been certified without reservation by the independent auditor.
Percentage-of-completion accounting method for work in progress
IBA uses the "percentage-of-completion" method to account for work in progress.
This method is commonly used in industries where the production cycle extends
over several fiscal years.
In this method, revenues are booked progressively in parallel to the advancement
of production, based on objective references, usually the incurred costs.
Current assets may include certain costs and revenues related to orders not yet
invoiced.
The two essential revenue components for IBA are revenues booked on delivery and
work-in-progress. Work-in-progress includes incurred costs increased pro rata by
95% of the budgeted margin for each stage of the work. This method gives a more
accurate and stable picture of IBA's results for projects whose production,
delivery, and installation phases last more than 12 months.
The post "Provisions for liabilities and charges" accounts for projects whose
revenues have been booked into total revenues, but where IBA must still incur
costs to complete installation.
This accounting method is in compliance with article 27,3 of the Belgian Royal
Decree of October 8, 1976.
Income Statement
Revenues
As revealed by the accounting method used by IBA, revenues are not an accurate
indicator of IBA's activities. A better picture of the company's results is
obtained by adding to revenues the post "(Increase/decrease) in stocks of
finished goods, work and contracts in progress." Following the
"work-in-progress" accounting method for production, the value of an order is
booked progressively into the "Variation of work-in-progress" account according
<PAGE>
to the progress of the order. It is later reversed from this account and booked
into total revenues when the product is shipped to the customer.
Revenues generated by the activity, excluding Mediflash, stood at 1.5 billion
BEF (37.5 million EUR) compared to 1.1 billion BEF (27.5 million EUR) in 1997,
an increase of 32%. Because Mediflash was acquired in December 1998, its results
have been booked only from October 1, 1998. The consolidated results therefore
take Mediflash data into the accounts only for the 4th quarter. Since these data
give only a poor picture of the effect of Mediflash's real contribution to the
group, a pro forma consolidated account has been established to better reflect
the importance of this end-of-the-year acquisition. This pro forma account shows
revenues for the group of 1.9 billion BEF (47.5 million EUR), an increase of 62%
against 1997.
Fixed Assets
Production essentially includes charges for research and development ("R & D").
For IBA, this sum amounts to 146 million BEF (3.7 million EUR). Adding the sum
for R & D expended by Mediflash (which this company does not tie up in capital
assets), the total for the IBA group rises to 187 million BEF (4.7 million EUR),
representing 10% of pro forma consolidated revenues. R & D funds are allocated
to all the sectors in which the group is active, and in particular to proton
therapy, within IBA, and to industrial ionization, within both IBA and
Mediflash. Mediflash is currently developing a new concept for low-power,
low-energy linear accelerators which are expected to take a significant part of
the market for "in-house" sterilization.
Income
IBA's net income was 273 million BEF (6.8 million EUR) in 1998 against
124 million BEF (3.1 million EUR) in 1997, an increase of 120%. IBA's operating
income increased to 405 million BEF (10.1 million EUR) against 112 million BEF
(2.8 million EUR) in 1997, an increase of 237%. For the first time IBA's
operating results were subject to payment of income taxes. Until 1997, IBA
benefited from tax-loss carryforwards and reductions for investments which, when
offset against net income, reduced its tax liability to zero.
An extraordinary charge of 42 million BEF (1.0 million EUR) was booked to cover
the costs of IBA's stock flotation in June 1998.
In accordance with its growth strategy, IBA has confirmed to the Mediflash
management its intention to make new investments in the sectors where the
acquired company is active. In view of these substantial investments over the
next several years, the Board of Directors decided to amortize the entirety of
the goodwill generated by the acquisition in the consolidated accounts over a
single year. These investments in Mediflash technology, together with synergies
with the acquired company, will significantly modify the group's strategy and
positioning in its various markets, which justifies the decision to amortize
goodwill over a single year. The result of this action was to reduce the pro
forma consolidated net income from 221 million BEF (5.5 million EUR) to 75
million BEF (1.9 million EUR).
Summary of Certain Significant Differences Between Belgian and US GAAP
The consolidated financial statements of Parent are prepared in accordance
with Belgian GAAP, which differs in several respects from US GAAP. The following
is a general summary of the significant differences:
Goodwill. Belgian GAAP offers three acceptable alternatives for accounting
for goodwill. Goodwill can be: (a) charged to operations in the year of the
acquisition; (b) charged to equity in the year of the acquisition; or (c)
<PAGE>
amortized to operations over its expected useful life. The goodwill related to
the purchase of Mediflash has been directly booked as an expense in the 1998
income statement. US GAAP provides for only one method of accounting for
goodwill and requires that goodwill be amortized over its expected useful life,
which may not exceed 40 years (or 10 years for certain technology).
Property. Freehold and long leasehold property may be revalued, and the
surplus or deficit arising on such revaluation is included in Parent's
consolidated reserves which form part of ordinary stockholders' equity.
Revaluation of freehold and long leasehold property is not permitted under US
GAAP.
Inventory. Inventory is valued at the lower of cost or realizable value. In
Belgium, cost of inventory, other than long-term work in progress, is calculated
using FIFO (first in first out) or average. US GAAP allows LIFO (last in first
out) to be used in addition to the two former methods.
Disposal of Businesses. Profits and losses on disposal of a subsidiary or
associate under Belgian GAAP are calculated as the net of the proceeds over (i)
carrying value plus (ii) amounts with respect to goodwill previously charged to
stockholders' equity. US GAAP reflects the unamortized element of goodwill in
the calculation.
Dividends. Ordinary share dividends are provided in the financial year in
respect of which they are declared by the board of directors. Under US GAAP,
such dividends are not provided for until the date declared.
Deferred Taxation. Deferred taxation is provided where it is probable that
a taxation liability will crystallize. Under US GAAP, as provided by Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes," full
provision must generally be made for all potential taxation liabilities.
Pensions. Pension costs, based on actuarial assumptions and methods, are
charged in the accounts so as to allocate the cost of providing benefits over
the service lives of employees in a consistent manner approved by the actuary.
US GAAP prescribes the method of actuarial valuation and also requires assets to
be assessed at fair value and the assessment of liabilities to be based on
current interest rates.
Work in Progress. Sales and earnings on uncompleted contracts are stated on
the "percentage-of-completion" method, which is the same as the one advised by
US GAAP. This method is commonly used in industries where the production cycle
extends over one fiscal year. The method is based on cost incurred to date in
relation to total estimated costs.
Research and Development. On IBA's financial statements, research and
development costs are capitalized and amortized on a five-year period. The
non-amortized research and development costs are written off in the event that
the company is giving up the research and development program before the end of
the amortization period.
Currency Exchange Gain/Loss. In accordance with Belgian GAAP, IBA books
unrealized foreign exchange losses in the income statement while unrealized
foreign exchange gains are deferred at year-end. As per US GAAP, foreign
exchange gains and losses resulting from the re-measurement process are both
booked in the income statement.
Defined Contribution Plan. IBA does not have any "defined benefit plan" for
its pension scheme. The Belgian accounting rules applied to the "defined
contribution plan" in place are the same as those developed as per US GAAP.
Cash Flow Statement. Belgian GAAP does not require any cash flow statement.
This statement is
<PAGE>
compulsory as per US GAAP.
Income Statement. The layout of the Belgian Profit and Loss Accounts is
basically designed around a "per natura" basis rather than by economical
purposes of revenues and expenses as per US GAAP.
Item 10. Additional Information
Item 10(f) of the Schedule 14D-1 is hereby amended and supplemented by the
addition of the following information:
Notwithstanding anything to the contrary that may be contained in the Offer
to Purchaser or in the Merger Agreement, previously filed as Exhibits (a)(1) and
(c)(1), respectively, to the Combined Schedule 14D-1 and Amendment No. 2 to the
Schedule 13D, all conditions to the Offer will be waived or satisfied on or
prior to the expiration of the Offer.
<PAGE>
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: July 14, 1999 IBA Acquisition Corp.
By: /s/ Pierre Mottet
---------------------------------
Name: Pierre Mottet
Title: President
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: July 14, 1999 Ion Beam Applications s.a.
By: /s/ Pierre Mottet
---------------------------------
Name: Pierre Mottet
Title: Chief Executive Officer
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: July 14, 1999 Belgabeam SCRL
By: /s/ Eric de Lamotte
---------------------------------
Name: Eric de Lamotte
Title: Director
<PAGE>
EXHIBIT INDEX
Exhibit
Number Exhibit
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*(a)(1) Offer to Purchase dated June 17, 1999
*(a)(2) Letter of Transmittal
*(a)(3) Notice of Guaranteed Delivery
*(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees
*(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees
*(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
*(a)(7) Form of Summary Advertisement dated June 17, 1999
*(a)(8) Press Release dated June 11, 1999 issued by IBA
*(b) Commitment Letter from Bank Brussels Lambert S.A., dated June 10, 1999
*(c)(1) Merger Agreement dated as of June 10, 1999, among the Company,
Purchaser, IBA GP and IBA
*(c)(2) Stockholders' Agreement dated June 10, 1999, among Purchaser, IBA, IBA
GP and certain stockholders of the Company
*(c)(3) Non-Disclosure Agreement, dated May 17, 1999 Agreement between IBA and
the Company
(d) None
(e) Not Applicable
(f) None
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* Previously Filed.
