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Filed by The Kroll-O'Gara Company
Pursuant to Rule 425 under the Securities Act of 1933 and
Deemed Filed Pursuant to Rule 14a-12 of the Securities Exchange Act of 1934
Subject Company: The Kroll-O'Gara Company (Commission File No. 000-21629)
KROLL-O'GARA ANNOUNCES DEFINITIVE PLAN FOR BUSINESS SEPARATION
PLAN WILL BE SUBMITTED TO SHAREHOLDERS AT A SPECIAL MEETING
NEW YORK, Aug. 30/PRNewswire/ - The Kroll-O'Gara Company (Nasdaq: KROG)
announced that its Board of Directors has approved an Agreement and Plan of
Reorganization and Dissolution (the "Agreement") which provides for the
separation of its primary businesses into two stand alone companies.
The Agreement provides for the separation of Kroll-O'Gara's two principal
operating segments - the Security Products & Services Group (O'Gara-Hess &
Eisenhardt Armoring) and the Investigations & Intelligence Group (Kroll Risk
Consulting Services). The separation is intended to resolve internal management
conflicts and to permit the management of each Group to reestablish clear
strategic and operating direction for the business of that Group.
The principal features of the Agreement include the following:
o Kroll-O'Gara will be separated into two independent publicly held
corporations: The O'Gara Company, which will carry on the business of
the Security Products & Services Group, and Kroll Risk Consulting
Services, Inc., which will carry on the business of the Investigations
& Intelligence Group;
o The separation will be tax free to Kroll-O'Gara and its shareholders;
o Kroll-O'Gara's public shareholders as a group will hold the same
percentage ownership in each of The O'Gara Company and Kroll Risk
Consulting Services, Inc. as they hold now in Kroll-O'Gara;
o Messrs. Thomas and Wilfred O'Gara and certain other senior members of
management historically associated with the Security Products and
Services Group will hold shares only in The O'Gara Company. Similarly,
Mr. Jules B. Kroll and certain other senior members of management
historically associated with the Investigations & Intelligence Group
will hold shares only in Kroll Risk Consulting Services, Inc.;
o Each of the two companies will continue to hold an equity interest in
Kroll-O'Gara's Internet security subsidiary, Securify Inc., which will
operate as a private company under separate management;
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o The Agreement will be presented to shareholders for consideration at a
special meeting to be held later this year or in early 2001; and
o Kroll-O'Gara anticipates that the separation will be completed during
the fourth quarter of 2000 or the first quarter of 2001.
Completion is subject to a number of conditions, including, among others,
shareholder approval, regulatory approvals and receipt of a private letter
ruling from the Internal Revenue Service to the effect that the separation will
be tax-free to Kroll-O'Gara and its shareholders. The Agreement must be approved
by the holders of a majority of the outstanding shares of Kroll-O'Gara common
stock and by the holders of a majority of the outstanding shares of Kroll-O'Gara
common stock excluding the shares held by Management. Kroll-O'Gara has filed a
request for the private letter ruling with the Internal Revenue Service.
Kroll-O'Gara expects to file preliminary proxy materials and related
registration statements with the Securities and Exchange Commission within the
next 10 to 15 days.
The Agreement was adopted by the Board of Directors based upon the
recommendation of a Special Committee of Directors, which determined that the
Agreement is fair to, and in the best interests of, Kroll-O'Gara's unaffiliated
public shareholders. The Special Committee has received an opinion from Bear,
Stearns & Co. Inc. that the consideration to be received by the unaffiliated
public shareholders, who will hold the same percentage ownership in each of The
O'Gara Company and Kroll Risk Consulting Services, Inc. as they hold now in
Kroll-O'Gara, is fair from a financial point of view.
Kroll-O'Gara will send a definitive proxy statement to shareholders in advance
of the special meeting of shareholders and will request their proxies at that
time. Shareholders should read the proxy statement when it is available because
it will contain important information about the separation and the participants
in the separation. Additionally, the proxy statement will be available for free
from the web site maintained by the Securities & Exchange Commission
(http://www.sec.gov) and will be available free from Kroll-O'Gara.
The statements in this release relating to Kroll-O'Gara's business plans are
forward-looking statements within the meaning of the federal securities laws.
These statements are subject to substantial risks and uncertainties. There can
be no assurance that the separation will be completed.
This press release does not constitute an offer of any security. Any offer will
be made pursuant to effective registration statements under the Securities Act
of 1933, which also will be available on the SEC's web site. The prospectus
contained in any registration statement will be mailed to shareholders along
with proxy solicitation materials and will be available to shareholders
without charge from Kroll-O'Gara.
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