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SECURITIES EXCHANGE AND COMMISSION
Washington, D. C. 20549
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FORM 8-K
CURRENT REPORT
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Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported): July 2, 1997
BEI Electronics, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-17885 71-0455756
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(State of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
One Post Street, San Francisco, California 94104
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(Address of principal executive offices) (Zip Code)
(415) 956-4477
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(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
The press release dated July 2, 1997, attached hereto as Exhibit 99, is
incorporated herein by reference.
ITEM 7. EXHIBITS.
99 Press release dated July 2, 1997.
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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, thereunto duly authorized.
BEI ELECTRONICS, INC.
Dated: July 7, 1997 By: /s/ Gary D. Wrench
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Gary D. Wrench
Senior Vice President and
Chief Financial Officer
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INDEX TO EXHIBITS
Page number in
Exhibit sequentially
Number numbered version
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99 Press Release dated July 2, 1997. 5
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EXHIBIT 99
PRESS RELEASE DATED JULY 2, 1997
For further information,
please contact:
Gary Wrench
Senior Vice President & CFO
FOR IMMEDIATE RELEASE
BEI ELECTRONICS, INC. PLANS SEPARATION OF SENSORS AND
MEDICAL BUSINESSES; WILL DISTRIBUTE SHARES IN NEW COMPANY
TO EXISTING SHAREHOLDERS; ADOPTS RIGHTS PLAN
SAN FRANCISCO, JULY 2, 1997 -- BEI Electronics, Inc. (Nasdaq: BEII)
announced that it plans to form a new company called BEI Technologies, Inc.
which will principally operate BEI's established sensors and systems business.
The Company will distribute all of the outstanding shares in the new company pro
rata to all holders of BEI Electronics, Inc. common stock. The Company, as a
condition to the spinoff, expects to receive an opinion from counsel that the
distribution should be tax free. BEI Electronics, Inc. will retain and operate
its medical device business and plans to change its name to BEI Medical Systems
Company after the spinoff. Following the distribution, which is expected at the
end of September, both companies would be immediately eligible for trading in
the public market. The symbol "BEIQ" has been reserved for BEI Technologies on
the Nasdaq National Market.
Charles Crocker, chairman, president and chief executive officer of BEI
Electronics stated, "We believe this planned separation will allow the positive
but different attributes of each company to be seen and understood more clearly,
and should allow the capital markets to evaluate each company according to its
unique characteristics. Our goal, overall, is to ensure that the ongoing
development of each of these businesses is not compromised by conflicting
strategies or requirements. Also, the availability of separate, publicly traded
securities should aid the future ability of both companies independently to
acquire capital on more favorable terms than they could as a consolidated
enterprise, to make acquisitions using stock as consideration and to attract and
retain key employees."
The newly formed company, BEI Technologies, will concentrate on engineered
components and value-added subsystems for industrial, automotive, aerospace and
automation markets. Its principal operating unit will be BEI Sensors & Systems
Company, a well established technology based manufacturing business which
designs, manufactures and sells proprietary intelligent electronic sensors for
motion control and pressure measurement, products
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complementary to these sensors, and value-added subsystems which utilize the
company's core products and know-how.
Commenting on the makeup of the new company, Mr. Crocker noted that BEI's
former defense systems business segment would be formally discontinued within
the next year and that financial reporting for BEI Technologies is expected to
reflect the defense systems segment as a discontinued operation. BEI previously
announced that the company had ended production of military rockets which had
been a major product line of the defense systems segment. On a pro forma basis,
the continuing business of BEI Technologies had sales in fiscal 1996 of $96.5
million.
BEI Electronics, Inc. will concentrate on medical products and is expected
to adopt the name of its subsidiary, BEI Medical Systems Company, following the
distribution. It will continue to develop the company's emerging medical device
business which focuses on global marketing of diagnostic and therapeutic
instruments and proprietary disposal products used by gynecologists and women's
physicians. According to Mr. Crocker, BEI Medical Systems Company foresees
continued active development of products that provide alternatives to
hysterectomy and products that allow fertility planning. The management of BEI
Medical Systems also believes there are opportunities for consolidating, through
selective acquisitions and alliances, the product offerings of other companies
focused on the women's healthcare market. The symbol "BMED" has been reserved
for BEI Medical Systems Company on the Nasdaq National Market.
The distribution of the common stock of BEI Technologies, Inc. will be
subject to regulatory review, and a registration statement on Form 10 is being
filed this week with the Securities and Exchange Commission. Mr. Crocker stated
that management's goal is to make the distribution effective at the end of
September, 1997, adding that the distribution would be on the basis of one share
of BEI Technologies, Inc. common stock for each common share of BEI Electronics,
Inc.
SHAREHOLDER RIGHTS PLAN
In a related announcement BEI Electronics, Inc. announced that its Board of
Directors approved the adoption of a Shareholder Rights Plan under which all
shareholders of record as of July 18, 1997 will receive rights to purchase
shares of a new series of Preferred Stock.
Mr. Crocker stated that the adoption of the Rights Plan is not in reaction
to an unsolicited offer, but is designed to enable all BEI Electronics
shareholders to realize the full value of their investment and to provide for
fair and equal treatment for all stockholders in the event that an unsolicited
attempt is made to acquire BEI Electronics. The adoption of the Rights Plan is
intended as a means to guard against abusive takeover tactics.
The rights will be distributed as a non-taxable dividend and will expire in
ten years from the Record Date. The rights will be exercisable only if a person
or group acquires 15 percent or more of the BEI Electronics Common Stock or
announces a tender offer for 15 percent or
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more of the Common Stock. If a person acquires 15 percent or more of BEI
Electronics' Common Stock, all rightsholders except the buyer will be entitled
to acquire BEI Electronics Common Stock at a discount. The effect will be to
discourage acquisitions of more than 15 percent of BEI Electronics' Common Stock
without negotiations with the Board.
The rights will trade with BEI Electronics Common Stock, unless and until
they are separated upon the occurrence of certain future events. The rights
distribution is not taxable to the stockholders. BEI Electronics' Board of
Directors may terminate the Plan at any time or redeem the rights prior to the
time a person acquires more than 15 percent of the BEI Electronics Common Stock.
Additional details regarding the Rights Plan will be outlined in a summary to be
mailed to all stockholders following the Record Date.
Except for historical information, this news release may be deemed to
contain forward-looking statements that involve risks and uncertainties,
including timely development, acceptance and pricing of new products; impact of
competitive products and pricing; the ability to manufacture products in
sufficient volume on an efficient and timely basis; general economic conditions
as they affect the Company's customers, as well as other risks detailed from
time to time in the Company's SEC reports, including the report on Form 10-K for
the year ended September 28, 1996, and the registration statement on Form 10 to
be filed by BEI Technologies.
BEI Electronics, Inc. is a diversified technology based manufacturing
company focused on two operating businesses: 1) BEI Sensors and Systems
Company, an established manufacturer of technically advanced electronic
components and systems used in industrial automation and automotive, military,
aviation and space systems and 2) BEI Medical Systems Company, an emerging
manufacturer of diagnostic and therapeutic products focused on gynecology and
women's health issues.
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