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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-9
AMENDMENT NO. 1
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
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WALLACE COMPUTER SERVICES, INC.
(Name of Subject Company)
WALLACE COMPUTER SERVICES, INC.
(Name of Person(s) Filing Statement)
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COMMON STOCK, PAR VALUE $1.00 PER SHARE
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
(TITLE OF CLASS OF SECURITIES)
932270 10 1
(CUSIP Number of Class Securities)
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MICHAEL J. HALLORAN
Vice President, Chief Financial Officer and Assistant Secretary
WALLACE COMPUTER SERVICES, INC.
4600 W. ROOSEVELT ROAD
Hillside, Illinois 60162
(312) 626-2000
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
COPIES TO:
FREDERICK C. LOWINGER CRAIG T. BOYD
STEVEN SUTHERLAND BUTLER, RUBIN,
SIDLEY & AUSTIN SALTARELLI & BOYD
ONE FIRST NATIONAL PLAZA THREE FIRST NATIONAL PLAZA
CHICAGO, ILLINOIS 60603 CHICAGO, ILLINOIS 60602
(312) 853-7000 (312) 444-9660
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ITEM 1. SECURITY AND SUBJECT COMPANY.
This Amendment No.1 amends and supplements the
Solicitation/Recommendation Statement on Schedule 14D-9 filed with the
Securities and Exchange Commission on August 15, 1995 (as amended, the "Schedule
14D-9") by Wallace Computer Services, Inc., a Delaware corporation (the
"Company"), relating to the tender offer by FRDK, Inc., a New York corporation
(the "Bidder") and a wholly owned subsidiary of Moore Corporation Limited, an
Ontario corporation ("Moore"), to purchase all outstanding shares of the
Company's common stock, par value $1.00 per share, including associated
preferred stock purchase rights, at a price per share of $56.00 net to the
seller in cash, upon the terms and subject to the conditions set forth in the
Offer to Purchase of the Bidder and Moore dated August 2, 1995 and in the
related Letter of Transmittal. Unless otherwise indicated, all capitalized
terms used but not defined herein shall have the meanings assigned to them in
the Schedule 14D-9.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.
Item 8 of the Schedule 14D-9 is hereby amended and supplemented as
follows:
On August 24, 1995, the Company issued a press release. A copy of
such press release is filed hereto as Exhibit 15, and is incorporated herein by
reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 15 Text of Press Release dated August 24, 1995 issued by the
Company
-1-
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
By: /s/ Michael J. Halloran
Name: Michael J. Halloran
Title: Vice President, Chief Financial
Officer and Assistant Secretary
Dated: August 25, 1995
-2-
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EXHIBIT INDEX
Exhibit 15 Text of Press Release dated August 24, 1995 issued by the
Company
-3-
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[LOGO]
WALLACE
COMPUTER SERVICES, INC.
NEWS RELEASE
For Immediate Release
Contact: Brad Samson, Wallace
708/449-8600
Wallace Reports Final Audited Results Unchanged From Preliminary;
Fourth Quarter EPS Rose 32.1% On 33.0% Sales Increase
Hillside, Ill., August 24, 1995 - Wallace Computer Services, Inc. (NYSE:WCS)
today reported final, audited results for its fourth quarter and fiscal year
ended July 31, 1995. Results were unchanged from the preliminary unaudited
figures announced on August 15.
The company also reiterated that on August 15, its Board of Directors
rejected the Moore Corporation's hostile tender offer of $56 per share as
inadequate, concluding that in light of the company's future prospects,
stockholders would best be served by Wallace remaining independent. The Board
is urging holders not to tender their shares to Moore. Wallace also continues
to pursue suits in federal court under antitrust and federal securities laws to
enjoin Moore's tender.
For the three months ended July 31, 1995, Wallace generated sales of $198.2
million compared with $149.1 million reported for the fourth quarter last year.
Net income rose to $15.8 million, or 70 cents per share, compared to $11.9
million, or 53 cents, achieved in fiscal 1994.
For the fiscal year, Wallace's sales reached $712.8 million, a 21.2 percent
increase over the $588.2 million recorded last year. Net income increased 17.0
percent to $55.3 million, or $2.46 per share, compared to $47.3 million, or
$2.13 per share before the cumulative effect of accounting changes in fiscal
1994.
"The increase in sales and net income in fiscal 1995 follows the equally
impressive gains achieved in the prior year," said Bob Cronin, Wallace's
president and CEO. "The results demonstrate the value of the strategy we've put
in place."
"Our investments in unique information systems and emphasis on providing
customers with cost-reducing solutions are the factors responsible for our
success, and I have every reason to expect that they will continue to produce
favorable results for shareholders in fiscal 1996."
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Cronin noted that each of Wallace's operating divisions achieved double
digit revenue increases for the quarter, with the largest increase being
reported by the TOPS division of the Office Products Group. "We are especially
pleased with the sales increase reported by the Business Forms Group which
matched the overall corporate increase," said Cronin. For the fiscal year, all
divisions reported significant sales increases reflecting a combination of
higher unit growth and higher prices to offset paper price increases. During
fiscal 1995, the company made two acquisitions which increased the Label group's
sales by $7.4 million. The biggest contributors to increased profits for the
year were the Office Products and Label groups.
Cronin said that in the fourth quarter, as in the earlier periods of the
year, the company took market share from its competitors. Wallace added 13
Wallace Information Network-TM- (W.I.N.-TM-) and Select Services customers
during the quarter, bringing the total at year-end to 157. As expected, most of
these are new customers. W.I.N. customers execute long-term contracts that
provide a more stable source of revenues for the company and enable it to reduce
costs for customers.
Cronin noted that many of the company's initiatives have yet to reach their
full potential. "W.I.N. accounts typically take six to twelve months to reach
full profitability, and we have many customers who have not yet reached that
point." "Plus, we continue adding new W.I.N. and Select Services customers
every quarter at a consistent rate," he added. Other initiatives that are
expected to make larger contributions in the new fiscal year are the company's
office products unit's joint venture with United Stationers, which was formed to
tap the fast-growing contract stationery market; the company's Platforms
electronic forms business which is expected to provide significant growth; and
new patented products that can boost revenues for the company's Colorforms
direct response promotional printing group.
The company noted that incremental LIFO charges for rising paper inventory
costs were 20 cents per share in the fourth quarter and 39 cents per share for
the year.
During fiscal 1995, the executive management team elected to convert their
deferred bonus balances to a new stock equivalent plan. The purpose of the new
plan is to further align the interests of management with those of the
stockholders. The significant increase in the company's stock price on the last
day of its fiscal year generated a charge of $800,000 (2 cents per share) to
record the increased market value of the stock equivalents.
Cronin also noted that, as expected, the development efforts for Platforms-
TM- electronic forms cost an incremental one cent per share for the fourth
quarter and six cents per share for the fiscal year.
Per share income after the cumulative effect of accounting changes was
$2.16 for the 1994 fiscal year. The three cents difference reflects the after-
tax benefit of adopting FASB No. 106 "Employers' Accounting for Post-Retirement
Benefits Other Than Pensions," and FASB No. 109 "Accounting for Income Taxes."
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"We begin fiscal 1996 with record backlogs and a high degree of confidence
in our prospects," Cronin said. "We anticipate that our unique competitive
advantages will result in another year of above-industry performance in all our
product categories."
Wallace is one of the nation's largest manufacturers and distributors of
information management products, services and solutions. Founded in Chicago in
1908, Wallace is headquartered in Hillside, Illinois with manufacturing,
distribution and sales facilities throughout the United States.
#####
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Wallace Computer Services, Inc.
(audited)
<TABLE>
<CAPTION>
Three months ended July 31 1995 1994
<S> <C> <C>
Net Sales $198,201,000 $149,069,000
Income Before Income Taxes $25,028,000 $18,548,000
Net Income $15,768,000 $11,871,000
Net Income Per Common Share $0.70 $0.53
Average Common Shares Outstanding 22,588,000 22,316,000
<CAPTION>
Twelve Months ended July 31 1995 1994
Net Sales $712,838,000 $588,173,000
Income Before Income Taxes $87,460,000 $73,856,000
Net Income Before Changes In $55,297,000 $47,268,000
Accounting
Net Income After Changes In Accounting $55,297,000 $47,931,000
Net Income Per Common Share Before
Cumulative Effect of Accounting $2.46 $2.13
Changes
Net Income Per Common Share After
Cumulative Effect of Accounting $2.46 $2.16
Changes
Average Common Shares Outstanding 22,490,000 22,193,000
</TABLE>
