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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
FORM 8-K/A
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 24, 1995
Commission file number 1-977
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WESTINGHOUSE ELECTRIC CORPORATION
---------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0877540
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(State of Incorporation) (I.R.S. Employer Identification No.)
11 Stanwix Street, Pittsburgh, Pennsylvania 15222-1384
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(Address of principal executive offices)
(412) 244-2000
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(Telephone No.)
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This Current Report on Form 8-K/A amends Item 7 (b) of the Current Report on
Form 8-K filed on November 24, 1995.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(b) Pro forma financial information.
The unaudited pro forma combined condensed financial statements give effect to
the acquisition of CBS Inc. (CBS) by Westinghouse Electric Corporation
(Westinghouse or the Corporation) in a transaction to be accounted for by the
purchase method of accounting. The following unaudited pro forma combined
condensed financial statements are included in this report:
- - Unaudited pro forma combined condensed statements of income:
- For the nine months ended September 30, 1995
- For the year ended December 31, 1994
- - Unaudited pro forma combined condensed balance sheet as of September 30,
1995.
The unaudited pro forma combined condensed statements of income are based on
the individual statements of income of Westinghouse and CBS for the nine months
ended September 30, 1995 and the year ended December 31, 1994 and combines the
results of operations of Westinghouse and CBS to give effect to the acquisition
as if it occurred at the beginning of each period presented.
The unaudited pro forma combined condensed balance sheet as of September 30,
1995 is based on the individual unaudited consolidated balance sheets of
Westinghouse and CBS as of September 30, 1995 and gives effect to the
acquisition as if it occurred on such date.
The pro forma adjustments included in this unaudited pro forma financial
information relating to the allocation of the purchase price for CBS are based
on preliminary assumptions and estimates which are subject to revision.
The unaudited pro forma combined condensed financial statements are not
necessarily indicative of the results of operations or financial position that
would have occurred had the CBS acquisition been consummated on the dates
assumed. These financial statements are not intended to be a projection of
future results or financial position and do not reflect any synergies that might
be achieved from combined operations.
These unaudited pro forma combined condensed financial statements should be
read in conjunction with the Corporation's consolidated financial statements
and notes contained in its Annual Report on Form 10-K for the year ended
December 31, 1994 and in its quarterly report on Form 10-Q for the quarter
ended September 30, 1995 and the consolidated financial statements of CBS
referred to in Item 7(a) of this report.
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Westinghouse Electric Corporation
Unaudited Pro Forma Combined Condensed Statement of Income
For the nine months ended September 30, 1995
(dollars in millions except per share amounts)
<TABLE>
<CAPTION>
Historical Pro Forma
----------------------- ----------------------
(W) Electric Adjustments
Corporation CBS Inc. (Note 1) Combined
------------------------ ----------- --------
<S> <C> <C> <C> <C>
Sales of products and services $ 6,342 $ 2,520 $ $ 8,862
Costs of products and services (4,758) (1,939) 3 (a) (6,694)
Restructuring and other actions (126) (32) (158)
Marketing administration &
general expenses (1,231) (369) (1,600)
Amortization of goodwill and other
intangibles (33) (7) (105)(b)(c) (145)
Other income and expenses, net 131 32 163
Interest expense (174) (37) (360)(d) (571)
----------------------- ------ --------
Income from Continuing Operations
before income taxes and minority
interest in income of consolidated
subsidiaries 151 168 (462) (143)
Income taxes (63) (61) 153 (e) 29
Minority interest in (income) loss
of consolidated subsidiaries (6) (6)
----------------------- ------ --------
Income from Continuing Operations $ 82 $ 107 $(309) $ (120)
======================= ====== ========
Primary earnings (loss) per
common share:
Continuing Operations $ 0.12 $ (0.38)
========= ========
Fully diluted earnings (loss)
per common share:
Continuing Operations $ 0.19 $ (0.28)
========= ========
Average number of common shares
outstanding (thousands):
Primary 402,517 402,517
========= ========
Fully diluted 432,256 432,256
========= ========
</TABLE>
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Westinghouse Electric Corporation
Unaudited Pro Forma Combined Condensed Statement of Income
For the year ended December 31, 1994
(dollars in millions except per share amounts)
<TABLE>
<CAPTION>
Historical Pro Forma
----------------------- ----------------------
(W) Electric Adjustments
Corporation CBS Inc. (Note 1) Combined
------------------------ ----------- --------
<S> <C> <C> <C> <C>
Sales of products and services $ 8,600 $ 3,712 $ $12,312
Costs of products and services (6,478) (2,823) 0 (a) (9,301)
Restructuring and other actions (74) (74)
Marketing administration &
general expenses (1,453) (468) (1,921)
Amortization of goodwill and other
intangibles (45) (8) (140)(b)(c) (193)
Other income and expenses, net (289) 71 (218)
Interest expense (175) (47) (406)(d) (628)
----------------------- ------ --------
Income from Continuing Operations
before income taxes and minority
interest in income of consolidated
subsidiaries 86 437 (546) (23)
Income taxes (46) (155) 176 (e) (25)
Minority interest in (income) loss
of consolidated subsidiaries (9) (9)
----------------------- ------ --------
Income from Continuing Operations $ 31 $ 282 $(370) $ (57)
======================= ====== ========
Primary earnings (loss) per
common share:
Continuing Operations $ (0.05) $ (.28)
========= ========
Fully diluted earnings (loss)
per common share:
Continuing Operations $ (0.05) $ (.28)
========= ========
Average number of common shares
outstanding (thousands):
Primary 383,736 383,736
========= ========
Fully diluted 383,790 383,790
========= ========
</TABLE>
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Westinghouse Electric Corporation
Unaudited Pro Forma Combined Condensed Balance Sheet
As of September 30, 1995
(dollars in millions)
<TABLE>
<CAPTION>
Historical Pro Forma
----------------------- ------------------------
(W) Electric Adjustments
Corporation CBS Inc. (Note 1) Combined
-------------------------- ------------ --------
<S> <C> <C> <C> <C>
Assets:
Cash and cash equivalents $ 167 $ 39 $ $ 206
Marketable securities 46 46
Customer receivables 1,465 416 1,881
Inventories 1,175 1,175
Uncompleted contracts costs over
related billings 788 788
Deferred income taxes 475 475
Program rights 415 (98)(e) 317
Prepaid and other current assets 243 42 285
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Total current assets 4,313 958 (98) 5,173
Investments and marketable securities 99 231 (109)(d) 221
Plant and equipment 1,741 491 288 (b) 2,520
Deferred income taxes 1,449 (89) (459)(g) 901
Goodwill and other intangible assets 1,134 322 5,484 (c) 6,940
Other noncurrent assets 768 140 46 (i) 954
Program rights 150 150
Net assets of Discontinued Operations 942 942
------------------- ------- -------
Total assets $10,446 $ 2,203 $ 5,152 $17,801
=================== ======= =======
Liabilities and shareholders equity:
Short-term debt $ 308 $ $ $ 308
Current maturities of long-term debt 321 228 549
Accounts payable trade 680 34 714
Liabilities for talent and
program rights 238 238
Liabilities for securities sold under
repurchase agreements 51 51
Uncompleted contracts billings over
related costs 439 439
Other current liabilities 1,633 267 150 (e)(h) 2,050
------------------- ------- -------
Total current liabilities 3,381 818 150 4,349
Long-term debt 1,746 495 5,392 (j) 7,633
Other noncurrent liabilities 3,481 408 201 (e)(f) 4,090
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Total liabilities 8,608 1,721 5,743 16,072
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Contingent liabilities and commitments
Minority interest 118 (109)(d) 9
------------------- ------- -------
Shareholders' equity 1,720 482 (482)(a) 1,720
------------------- ------- -------
Total liabilities and
shareholders' equity $10,446 $ 2,203 $ 5,152 $17,801
=================== ======= =======
</TABLE>
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Notes to Unaudited Pro Forma Combined Condensed Financial Statements
The unaudited pro forma combined condensed financial statements have been
prepared to reflect the acquisition of CBS Inc. (CBS) by Westinghouse Electric
Corporation (Westinghouse) for an aggregate purchase price of $5,351 million.
These financial statements reflect the allocation of the purchase price to the
assets acquired and liabilities assumed based on their estimated fair values as
of the date of the acquisition. The excess of the consideration paid over the
estimated fair value of net assets acquired totalling $4,505 million has been
presented as goodwill and is expected to be amortized on a straight-line basis
over 40 years.
Transactions between CBS and Westinghouse, other than those related to a
television station and a sales representation joint venture, have not been
eliminated from the unaudited pro forma combined condensed financial
statements, as the amounts are immaterial in each of the periods presented.
Certain reclassifications have been made to the Westinghouse and CBS historical
financial statements to set forth the unaudited pro forma combined condensed
financial statements after giving effect to the acquisition.
Pro forma adjustments giving effect to the acquisition in the unaudited pro
forma combined condensed statements of income reflect the following:
(a) Additional depreciation resulting from the step-up in value of property and
equipment acquired. Depreciation is provided on a straight-line basis over
periods ranging from 6 to 27.5 years.
(b) Amortization of identified intangible assets including FCC licenses and
film libraries on a straight-line basis over periods ranging from 23 to 40
years.
(c) Amortization of goodwill on a straight-line basis over 40 years, net of
elimination of CBS's historical amortization of goodwill.
(d) Increase in interest expense resulting from interest costs associated with
borrowings under the Corporation's $7.5 billion credit agreement to finance the
acquisition of CBS and repay certain existing borrowings and amortization of
related debt issuance costs. Rate assumptions used for these borrowings
include an average LIBOR of 6.09% plus a 1.75% spread for the nine months ended
September 30, 1995 and an average LIBOR of 4.78% plus a 1.75% spread for the
year ended December 31, 1994.
(e) Income tax effect of pro forma adjustments, excluding amortization of
goodwill, which is non-deductible for tax purposes.
Pro forma adjustments giving effect to the acquisition in the unaudited pro
forma combined condensed balance sheet reflect the following:
(a) the elimination of predecessor shareholders' equity.
(b) the revaluation of plant and equipment to estimated fair value.
(c) the identification of specific intangible assets including FCC licenses
totaling $1,145 million and film libraries totaling $134 million and the excess
of aggregate purchase price, over the fair value of the net identifiable assets
acquired (goodwill).
(d) the elimination of the investment and related minority interest related to
the television station and sales representation joint ventures between
Westinghouse and CBS.
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(e) the revaluation of programming rights and contract commitments to
fair value.
(f) the revaluation of liabilities related to employee benefit plans to fair
value.
(g) the recognition of deferred income taxes related to the purchase accounting
adjustments.
(h) the recognition of a liability under EITF 95-3 for involuntary employee
terminations and other closedown costs.
(i) the cost of financing fees paid at the closing.
(j) borrowings to finance the acquisition of CBS and transaction costs.
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 hereunto duly authorized.
WESTINGHOUSE ELECTRIC CORPORATION
(Registrant)
By: /s/ Fredric G. Reynolds
----------------------------
Fredric G. Reynolds
Executive Vice President and
Chief Financial Officer
Date: February 6, 1996
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