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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 30, 2000
UNIVERSAL COMPRESSION HOLDINGS, INC.
UNIVERSAL COMPRESSION, INC.
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(Exact names of registrants as specified in their charters)
Delaware 001-15843 13-3989167
Texas 333-48279 74-1282680
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(States or other (Commission File (IRS Employer
jurisdictions of Numbers) Identification
incorporation) Nos.)
4440 Brittmoore Road, Houston, Texas 77041
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(Address of principal executive offices) (Zip Code)
(713) 335-7000
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(Registrants' telephone number, including area code)
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Item 5. Other Events
Universal Compression Holdings, Inc., a Delaware corporation, filed a
preliminary proxy statement (the "Preliminary Proxy Statement") with the
Securities and Exchange Commission on November 30, 2000, which at such time as a
definitive proxy statement is filed will seek approval by its shareholders of
the issuance of 13,750,000 shares of Universal Compression Holdings' common
stock, par value $0.01 per share ("Common Stock"), to WEUS Holding, Inc.
pursuant to an Agreement and Plan of Merger dated as of October 23, 2000 by and
among Universal Compression Holdings, Inc., Universal Compression, Inc., a Texas
corporation and wholly owned subsidiary of Universal Compression Holdings, Inc.
("UCI"), Weatherford International, Inc., a Delaware corporation
("Weatherford"), WEUS Holding, Inc., a Delaware corporation and wholly owned
subsidiary of Weatherford ("WEUS"), and Enterra Compression Company, a Delaware
corporation and wholly owned subsidiary of WEUS ("Enterra"), which provides for
the merger of Enterra with and into UCI (the "Merger"). If the Merger is
consummated, the 13,750,000 shares of Common Stock to be issued in the Merger
will represent approximately 48% of our outstanding Common Stock. Those shares
owned by WEUS in excess of 33(1)/3% of our outstanding Common Stock will be
subject to certain voting restrictions under a voting agreement. A copy of the
Preliminary Proxy Statement is included as an exhibit hereto and is incorporated
by reference herein for informational purposes only and not as a solicitation.
If the Merger is consummated, we will refinance our existing
indebtedness and operating lease arrangements, as well as Enterra's. We are
presently negotiating a new $75-$100 million revolving bank credit facility. We
are also negotiating a new operating lease facility which, either separately or
aggregated with an asset-backed securitization, will provide $500-$600 million
of financing for us. It is anticipated that under the new operating lease
facility and asset-backed securitization, we will sell certain of our currently
owned and hereafter acquired compression equipment to a newly formed business
trust, and lease it back from the trust for a specified term. In addition,
pursuant to the terms of our Indenture, the holders of UCI's 9 7/8% senior
discount notes can require UCI to redeem their notes as a result of the
consummation of the proposed Merger. We plan to issue debt securities to finance
this redemption.
The Merger is subject to various conditions, including the approval by
our shareholders of the share issuance, the refinancing of our and Enterra's
indebtedness and operating lease arrangements, regulatory approvals and other
customary conditions. There can be no assurance that the Merger will be
consummated, or that any or all of the new indebtedness and operating lease
arrangements will be obtained or, if obtained, will be on favorable terms.
Included in the Preliminary Proxy Statement and attached hereto as
exhibits, which exhibits are incorporated herein by reference, are certain
unaudited pro forma combined condensed financial information and historical
financial statements in connection with the proposed Merger. Such pro forma
information is based on our and Enterra's historical financial statements and
has been prepared to illustrate the effect of the proposed Merger. The unaudited
combined condensed pro forma information is provided for informational purposes
only and does not purport to represent what our financial position or results of
operations would actually have been had the Merger, if consummated, occurred on
such dates or to project our results of operations or
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financial position for any future period. The unaudited pro forma combined
condensed financial information should be read in conjunction with the
historical financial statements and accompanying disclosures filed as an exhibit
to this Report and incorporated herein by reference and included in our Annual
Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities
and Exchange Commission.
On September 15, 2000, we completed the acquisition of Gas Compression
Services, Inc. ("GCSI"), a supplier of gas compression equipment and services
with fabrication and overhaul facilities in Michigan and Texas. Certain
historical financial information included in the Preliminary Proxy Statement as
of September 30, 2000 includes GCSI's operations for 15 days. We expect to add
$35 million to $38 million in revenues and approximately $14.5 million per year
in EBITDA as a result of the GCSI acquisition. EBITDA is defined as net income
plus income taxes, interest expense, leasing expense, management fees,
depreciation and amortization. EBITDA is not a measure of financial performance
under generally accepted accounting principles and should not be considered an
alternative to operating income or net income as an indicator of our operating
performance or to net cash provided by operating activities as a measure of its
liquidity. Additionally, the EBITDA computation used herein may not be
comparable to other similarly titled measures of other companies including
Enterra.
Statements about our outlook and all other statements contained herein
other than historical facts are forward-looking statements made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements rely on a number of assumptions concerning
future performance and events and are subject to a number of uncertainties and
factors, many of which are outside our control, which could cause actual results
to differ materially from such statements. While we believe that the assumptions
concerning future events are reasonable, we caution that there are inherent
difficulties in predicting certain important factors that could impact the
future performance or results of our business. Among the important factors that
could cause actual results to differ materially from those indicated by such
forward-looking statements are successful completion of growth and service
projects and the proposed Merger, costs, risks and effects of legal and
administrative proceedings and governmental regulations, the new indebtedness
and operating lease arrangements, integration of and actual cost savings and
other synergies resulting from acquired businesses, future sales and profits,
competition, risks of international operations, general economic factors and
other factors. These risk factors, when applicable, are discussed in our and
UCI's filings with the Securities and Exchange Commission, copies of which are
available to the public. We disclaim any intention or obligation to revise or
update any forward-looking statements whether as a result of new information,
future events, or otherwise.
Item 7. Financial Statements and Exhibits
(c) Exhibits
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<TABLE>
<CAPTION>
Exhibit No. Description
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<S> <C>
23.1 Consent of Deloitte & Touche LLP for Universal Compression Holdings, Inc.
23.2 Consent of Arthur Andersen LLP for Enterra Compression Company and Weatherford
Compression.
23.3 Consent of KPMG LLP for Global Compression Holdings, Inc.
99.1 Pro forma combined condensed financial information giving effect to the Merger for the
six months ended September 30, 2000 and the year ended March 31, 2000.
99.2 Consolidated financial statements of Universal Compression Holdings, Inc. as of
March 31, 1999 and 2000, and the results of its operations and its cash flows for
the period from December 12, 1997 (inception) through March 31, 1998 and for the
years ended March 31, 1999 and 2000.
99.3 Financial statements of Tidewater Compression Service, Inc. for the period from April
1, 1997 through February 20, 1998.
99.4 Consolidated financial statements of Enterra Compression Company as of and for the
year ended December 31, 1999.
99.5 Combined financial statements of Weatherford Compression as of and for the year ended
December 31, 1998.
99.6 Combined financial statements of Weatherford Compression as of and for the year ended
December 31, 1997.
99.7 Consolidated financial statements of Global Compression Holdings, Inc. and
subsidiaries as of February 2, 1999, and December 31, 1998 and 1997 and the results
of their operations and their cash flows for the period January 1, 1999 through
February 2, 1999 and years ended December 31, 1998 and 1997.
99.8 Preliminary Proxy Statement of Universal Compression Holdings, Inc. on Schedule 14A
filed with the Securities and Exchange Commission on November 30, 2000.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
UNIVERSAL COMPRESSION HOLDINGS, INC.
UNIVERSAL COMPRESSION, INC.
(Registrants)
Date: November 30, 2000 By: /s/ RICHARD W. FITZGERALD
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Richard W. FitzGerald
Senior Vice President and
Chief Financial Officer
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EXHIBIT INDEX
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<CAPTION>
Exhibit No. Description
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<S> <C>
23.1 Consent of Deloitte & Touche LLP for Universal Compression Holdings, Inc.
23.2 Consent of Arthur Andersen LLP for Enterra Compression Company and Weatherford
Compression.
23.3 Consent of KPMG LLP for Global Compression Holdings, Inc.
99.1 Pro forma combined condensed financial information giving effect to the Merger for
the six months ended September 30, 2000 and the year ended March 31, 2000.
99.2 Consolidated financial statements of Universal Compression Holdings, Inc. as of
March 31, 1999 and 2000, and the results of its operations and its cash flows for
the period from December 12, 1997 (inception) through March 31, 1998 and for the
years ended March 31, 1999 and 2000.
99.3 Financial statements of Tidewater Compression Service, Inc. for the period from
April 1, 1997 through February 20, 1998.
99.4 Consolidated financial statements of Enterra Compression Company as of and for the year
ended December 31, 1999.
99.5 Combined financial statements of Weatherford Compression as of and for the year ended
December 31, 1998.
99.6 Combined financial statements of Weatherford Compression as of and for the year ended
December 31, 1997.
99.7 Consolidated financial statements of Global Compression Holdings, Inc. and
subsidiaries as of February 2, 1999, and December 31, 1998 and 1997 and the results
of their operations and their cash flows for the period January 1, 1999 through
February 2, 1999 and years ended December 31, 1998 and 1997.
99.8 Preliminary Proxy Statement of Universal Compression Holdings, Inc. on Schedule 14A
filed with the Securities and Exchange Commission on November 30, 2000.
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