<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
(Amendment No. 1)
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 11, 1996
NEWPORT NEWS SHIPBUILDING INC.
(Exact name of registrant as specified in its charter)
Delaware 1-12385 74-1541566
(State or other jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
4101 Washington Avenue, Newport News, VA 23607-2770
(Address of principal executive offices) (Zip Code)
(757) 380-2000
(Registrant's telephone number, including area code)
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Newport News Shipbuilding Inc. (the "Company" or the "Registrant")
hereby amends its Current Report on Form 8-K dated December 20, 1996 by adding
the following additional items:
ITEM 2. Acquisition or Disposition of Assets.
On December 11, 1996, pursuant to a Distribution Agreement, dated as of
November 1, 1996, among Tenneco Inc. ("Tenneco", now known as El Paso Tennessee
Pipeline Co.), the Company and New Tenneco Inc. ("New Tenneco", now known as
Tenneco Inc.): (i) Tenneco and its subsidiaries undertook and completed various
intercompany transfers and distributions designed to restructure, divide and
separate their then existing businesses and assets so the assets, liabilities
and operations of (A) the shipbuilding businesses would be owned by the Company
and (B) the automotive parts, packaging and administrative services businesses
would be owned by New Tenneco, and (ii) Tenneco subsequently distributed (the
"Shipbuilding Distribution") pro rata to holders of Tenneco Common Stock, par
value $5.00 per share, all of the outstanding Common Stock, par value $.01 per
share, of the Company.
ITEM 7. Financial Statements and Exhibits.
(b) Pro-forma financial information
See pages 3 through 6 of this Report.
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<PAGE>
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following Unaudited Pro Forma Combined Balance Sheet of the Company as of
September 30, 1996 and Unaudited Pro Forma Combined Statements of Earnings for
the nine months ended September 30, 1996 and the year ended December 31, 1995
have been prepared to reflect the Shipbuilding Distribution and related
transactions (the "Distribution Transaction"), including: (i) the issuance of
$400 million aggregate principal amount of Senior Notes and Senior Subordinated
Notes (collectively "Notes"); (ii) borrowings of $214 million under the
Company's senior credit facility ("Senior Credit Facility"); (iii) the cash
dividend of $600 million paid by the Company to Tenneco or one or more of its
subsidiaries; (iv) the payment of $14 million of certain fees and expenses
incurred in connection with the Senior Credit Facility and the Notes; and (v)
the issuance of NNS Common Stock pursuant to the Shipbuilding Distribution.
The historical Combined Financial Statements reflect the financial position and
results of operations of the shipbuilding business whose net assets were
transferred to the Company prior to the Distribution Transaction. The
accounting for such transfer of assets and liabilities represents a
reorganization of companies under common control and, accordingly, all assets
and liabilities are reflected at their historical cost in the Combined
Financial Statements.
The Unaudited Pro Forma Combined Balance Sheet has been prepared as if the
various components of the Distribution Transaction occurred on September 30,
1996; the Unaudited Pro Forma Combined Statements of Earnings have been
prepared as if the various components of the Distribution Transaction occurred
as of January 1, 1995. The Unaudited Pro Forma Combined Financial Statements
set forth on the following pages are not necessarily indicative of the results
that would have actually occurred if the Distribution Transaction had been
consummated as of September 30, 1996, or January 1, 1995, or results which may
be attained in the future.
The pro forma adjustments, as described in the Notes to the Unaudited Pro Forma
Combined Financial Statements, are based upon available information and upon
certain assumptions that management believes are reasonable.
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UNAUDITED PRO FORMA COMBINED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
-------------------------------------
NINE MONTHS ENDED SEPTEMBER 30,
1996
COMPANY PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS COMBINED
In millions (except share data) ---------- ----------- ------------
<S> <C> <C> <C>
Net sales.................................... $1,437 $ $ 1,437
Operating costs and expenses................. 1,320 2 (a) 1,322
------ ------- -----------
Operating earnings........................... 117 (2) 115
Interest expense............................. 25 (25)(b) 40
40 (a)
------ ------- -----------
Earnings before income taxes................. 92 (17) 75
Provision for income taxes................... 40 9 (b) 35
(14)(a)
------ ------- -----------
Net earnings................................. $ 52 $ (12) $ 40
====== ======= ===========
Average number of common shares outstanding.. 34,083,609
===========
Earnings per share........................... $1.17
===========
<CAPTION>
-------------------------------------
YEAR ENDED DECEMBER 31, 1995
COMPANY PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS COMBINED
---------- ----------- ------------
<S> <C> <C> <C>
Net sales.................................... $1,756 $ $ 1,756
Operating costs and expenses................. 1,599 2 (a) 1,601
------ ------- -----------
Operating earnings........................... 157 (2) 155
Interest expense............................. 29 (29)(b) 53
53 (a)
Other (income), net.......................... (3) (3)
------ ------- -----------
Earnings before income taxes................. 131 (26) 105
Provision for income taxes................... 58 10 (b) 49
(19)(a)
------ ------- -----------
Net earnings................................. $ 73 $ (17) $ 56
====== ======= ===========
Average number of common shares outstanding.. 34,799,188
===========
Earnings per share........................... $1.61
===========
</TABLE>
See the accompanying notes to Unaudited Pro Forma Combined Financial
Statements.
4
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UNAUDITED PRO FORMA COMBINED BALANCE SHEET
<TABLE>
<CAPTION>
---------------------------------
AS OF SEPTEMBER 30, 1996
COMPANY PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS COMBINED
In millions ---------- ----------- ---------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents..................... $ 1 $ 4 (c) $ 5
614 (d)
(614)(e)
Contracts in process.......................... 298 298
Other current assets.......................... 180 180
------ ----- ------
Total current assets...................... 479 4 483
------ ----- ------
Property, plant and equipment, net............ 834 834
Other assets.................................. 160 14 (e) 174
------ ----- ------
Total noncurrent assets................... 994 14 1,008
------ ----- ------
$1,473 $ 18 $1,491
====== ===== ======
<CAPTION>
LIABILITIES AND EQUITY
<S> <C> <C> <C>
Accounts payable.............................. $ 133 $ (31)(f) $ 102
Short-term debt............................... 160 (160)(b) 28
28 (d)
Other accrued liabilities..................... 181 181
------ ----- ------
Total current liabilities................. 474 (163) 311
------ ----- ------
Long-term debt................................ 267 (267)(b) 586
586 (d)
Deferred income taxes......................... 136 136
Other long-term liabilities................... 262 262
------ ----- ------
Total noncurrent liabilities.............. 665 319 984
------ ----- ------
Common stock.................................. 1 (g) 1
Paid-in capital............................... 195 (g) 195
Retained earnings............................. -- (g) --
Combined equity............................... 334 427 (b) --
4 (c)
(600)(e)
31 (f)
(196)(g)
------ ----- ------
Total equity.............................. 334 (138) 196
------ ----- ------
$1,473 $ 18 $1,491
====== ===== ======
</TABLE>
See the accompanying notes to Unaudited Pro Forma Combined Financial
Statements.
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NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(a) To reflect: (i) interest expense related to the borrowings assumed
outstanding under the Senior Credit Facility and the Notes at the assumed
annual interest rates discussed in (d) below, (ii) the cost of commitment
fees on the unused borrowing capacity under the revolving credit facility
("Revolving Credit Facility") constituting part of the Senior Credit
Facility, and (iii) the amortization of deferred debt financing costs
incurred in connection with the Senior Credit Facility and the Notes, as
well as the related tax effects of these items at an assumed statutory rate
of 35%. A 1/8% change in the assumed annual interest rates of the Senior
Credit Facility and the Notes would change pro forma annual interest expense
by $0.8 million, before the effect of income taxes.
(b) To reflect the elimination of corporate debt and related interest expense
allocated by Tenneco to the Company. A portion of Tenneco's corporate debt
and the related interest expense has been allocated to the Company as a
component of the Company's historical capitalization.
(c) To reflect a cash contribution from Tenneco to the Company pursuant to the
cash realignment provisions in the distribution agreement covering the
Shipbuilding Distribution.
(d) To reflect $614 million in total borrowings under the various credit
facilities which borrowings will consist of (i) a $200 million six-year
amortizing Term Loan with an estimated annual interest rate of 8%, (ii)
$200 million Senior Notes due 2006 with an estimated annual interest rate
of 8.625%, (iii) $200 million Senior Subordinated Notes due 2006 with an
estimated annual interest rate of 9.25%, and (iv) $14 million in borrowings
under the $215 million six-year Revolving Credit Facility, with an
estimated annual interest rate of 8% and commitment fees due on the unused
portion of the facility, for payment of certain fees and expenses described
in (f) below. Approximately $28 million of the assumed Term Loan borrowings
will mature within one year from the consummation of the Distribution
Transaction, and such amount is reflected as short-term debt in the
accompanying Pro Forma Combined Balance Sheet.
(e) To reflect: (i) a cash dividend of $600 million paid by the Company
to Tenneco or one or more of its subsidiaries, principally using borrowings
under the Senior Credit Facility and the Notes and (ii) a payment of $14
million for certain fees and expenses in connection with the Senior Credit
Facility and Notes.
(f) To reflect the settlement or capitalization of intercompany accounts
payable with Tenneco affiliates pursuant to certain corporate restructuring
transactions.
(g) To reflect the distribution of NNS Common Stock to holders of Tenneco
Common Stock at an exchange ratio of one share of NNS Common Stock for five
shares of Tenneco Common Stock.
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SIGNATURES
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 thereunto duly authorized.
NEWPORT NEWS SHIPBUILDING INC.
December 23, 1996 /s/ STEPHEN B. CLARKSON
--------------------------
By: Stephen B. Clarkson
Vice President, General Counsel
and Secretary
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