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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
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DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): MAY 19, 1999
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TWEETER HOME ENTERTAINMENT GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-24091 04-3417513
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
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10 PEQUOT WAY
CANTON, MASSACHUSETTS 02021
(ADDRESS, INCLUDING ZIP CODE OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
Item 5. Other Events
On May 18, 1999, the Registrant announced that it had reached an agreement in
principle to acquire DOW Stereo/Video, Inc., located in San Diego, California. A
copy of the press released issued by the Registrant on May 18, 1999 regarding
the foregoing is filed herewith as Exhibit 99 and is incorporated herein by
reference.
Item 7. Financial Statements and Exhibits
(a) Exhibits
Exhibit Number
99 Press Release dated May 18, 1999
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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
under-signed hereunto duly authorized.
TWEETER HOME ENTERTAINMENT GROUP, INC.
Registrant
DATED: MAY 19, 1999
By: /s/ Joseph G. McGuire
Joseph G. McGuire
Chief Financial Officer
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Exhibit 99
TWEETER HOME ENTERTAINMENT GROUP ANNOUNCES AN AGREEMENT TO ACQUIRE
DOW STEREO/VIDEO, INC. IN SAN DIEGO, CALIFORNIA
CANTON, Mass. - May 18, 1999 - Tweeter Home Entertainment Group, Inc., announced
today that the company has reached an agreement in principle to acquire DOW
Stereo/Video, Inc., located in San Diego, California. DOW is a nine-store
specialty consumer electronics retailer with sales of approximately $38 million,
and has been in business in the San Diego market for over 30 years. The
transaction is expected to be completed on or about July 1, 1999. Tweeter will
pay approximately $5.5 million dollars for the company excluding acquisition
costs and has the option of paying approximately $500 thousand of the purchase
price in Tweeter common stock issued under its shelf registration filed on April
13, 1999.
Jeffrey Stone, Tweeter's President and Chief Operating officer said, "The DOW
acquisition is another important step in Tweeter's growth. Industry leaders
recognize DOW as a top specialty consumer electronics retailer and a major
player in the introduction of new consumer electronics technologies to the
American public. Building on DOW's base of nine stores and retail sales of
approximately $38 million, Tweeter expects to aggressively grow DOW's presence
in the San Diego and southern California markets over the next several years. We
feel that DOW is currently under-stored in southern California and we intend to
add stores and enhance their market position by moving their product selection
to a more upscale mix in accordance with our company's overall strategy."
The DOW Stereo transaction will be the second acquisition for Tweeter Home
Entertainment Group in 1999. Tweeter closed on the acquisition of Home
Entertainment, Inc. of Texas on February 1, 1999. Home Entertainment is a
seven-store chain serving the Houston and Dallas markets, and reported retail
revenue of approximately $25 million for the year ended June 30, 1998.
Stone added that, "We also expect to open up to 24 new stores between now and
the end of fiscal 2000 and relocate seven existing stores, most of the
relocations from the mid-Atlantic marketplace. This will allow us even greater
leverage in those markets where we already have a solid presence. With the
addition of the nine DOW stores, we will cut our new store plan for fiscal 1999
to seven stores, from the previously announced eleven stores."
According to Joe McGuire, Tweeter's CFO, "We expect this acquisition to have
little impact to earnings per share for fiscal 1999. For fiscal 2000, our
earnings per share expectations are that DOW will add $.04 to the first quarter,
$.01 to the second, nothing for the third, and $.02 to the fourth. Our revenue
projections are $6.8 million for the remainder of fiscal 1999. For fiscal 2000,
our revenue expectations for DOW are $9.8 million for the first quarter, $6.9
million for the second quarter, $7.9 million for the third quarter, and $8.1
million for the fourth quarter. After the first year, we will look to grow this
contribution as we further develop the southern California market where DOW
currently operates."
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The agreement in principle to acquire DOW Stereo/Video, Inc. is subject to
various terms and conditions, which must be fulfilled to Tweeter's satisfaction
prior to closing.
Tweeter has led the consumer electronics industry in sales growth in each of the
last two years through strong comp store performance, acquisitions and building
additional stores in those acquired markets. Industry leading profits were also
attained in 1998. Tweeter Home Entertainment Group, Inc. was founded in 1972 by
current Chairman and Chief Executive Officer Sandy Bloomberg. Based in Canton,
Massachusetts, the company is a specialty retailer of mid- to high-end audio and
video consumer electronics products. The company's 1998 revenues were $232.3
million. Tweeter has won numerous awards. It was named "Consumer Electronics
Retailer of the Year" for both 1996 and 1997 by Audio-Video International, the
country's leading consumer electronics industry trade publication. The company
employs approximately 1,200 associates. It operates 62 stores under the Tweeter,
Bryn Mawr, HiFi Buys and Home Entertainment names in the New England,
Mid-Atlantic, Southeastern and Texas Markets, respectively.
To arrange an interview with a senior executive at Tweeter, contact Anne-Marie
Boucher at 781 830 3478, fax 781 830 3223 or email at [email protected].
Further information on Tweeter Home Entertainment Group can also be found on the
company's web site at www.twtr.com.
Certain statements contained in this press release, including, without
limitation, statements containing the words "expects," "anticipates,"
"believes," and words of similar import, constitute "forward looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. The
financial and other projections included in this press release concerning DOW's
results following the planned acquisitions are based on various assumptions,
including that Tweeter will complete the acquisition as currently contemplated.
It is possible that Tweeter's acquisition of DOW will not be completed as
currently planned. Further, these projections involve future operations and
revenues and are therefore speculative. While Tweeter's management believes that
the projections are based on reasonable assumptions concerning DOW's operations
and revenues following the completion of the planned acquisition, such
operations and revenues may differ significantly from management's current
expectations. These forward looking statements and projections are subject to
various risks and uncertainties, including those related to Company growth and
acquisitions, dependence on key personnel, the need for additional financing,
competition and seasonal fluctuations, and those referred to in the Company's
Registration Statement on Form S-1 (SEC file number 333-70543), that could cause
actual future results and events to differ materially from those currently
anticipated. Readers are cautioned not to place undue reliance on these forward
looking statements and financial projections.
