BERGEN BRUNSWIG CORPORATION
716,080 Shares
Class A Common Stock
The shareholders of Bergen Brunswig Corporation listed below, as well as certain
of their transferees, are offering and selling 716,080 shares of the Company's
Class A Common Stock under this Prospectus.
The selling shareholders obtained their shares of Class A Common Stock on
September 30, 1998, by virtue of the mergers of Ransdell Surgical, Inc. and
Choice Medical, Inc. into two wholly-owned subsidiaries of Bergen Brunswig
Corporation.
The Class A Common Stock is listed on the New York Stock Exchange under the
symbol "BBC". On April 6, 1999, the closing price of one share of Class A Common
Stock on the New York Stock Exchange was $20 1/16.
The selling shareholders will sell their shares of Class A Common Stock on the
New York Stock Exchange at prevailing market prices. Bergen Brunswig Corporation
will not receive any of the proceeds from the sale of the shares of Class A
Common Stock by the selling shareholders.
The Company's principal executive offices are located at 4000 Metropolitan
Drive, Orange, California 92868-3598; telephone (714) 385-4000.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this Prospectus. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is April 7, 1999.
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ADDITIONAL INFORMATION
We file annual, quarterly, and current reports, proxy statements, and other
documents with the SEC. You may read and copy any document we file at the SEC's
public reference room at Judiciary Plaza Building, 450 Fifth Street, N.W., Room
1024, Washington, D.C. 20549. You should call 1-800-SEC-0330 for more
information on the public reference room. The SEC maintains an Internet site at
http://www.sec.gov where certain reports, proxy and information statements, and
other information regarding issuers (including Bergen Brunswig Corporation) may
be found.
This Prospectus is part of a registration statement that we filed with the SEC.
The registration statement contains more information than this Prospectus
regarding Bergen Brunswig Corporation and its Class A Common Stock, including
certain exhibits. You can get a copy of the registration statement from the SEC
at the address listed above or from its Internet site.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate" into this Prospectus information we file with
it in other documents. This means that we can disclose important information to
you by referring to other documents that contain that information. The
information incorporated by reference is considered to be part of this
Prospectus, and information we file later with the SEC will automatically update
and supersede this information. We incorporate by reference the documents listed
below, except to the extent information in those documents is different from the
information contained in this Prospectus, and all future documents filed with
the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act
of 1934 until we terminate the offering of these shares.
(a) Annual Report on Form 10-K for the fiscal year ended September 30, 1998, as
amended;
(b) Quarterly Report on Form 10-Q for the quarter ended December 31, 1998;
(c) Current Reports on Form 8-K November 12, 1998, January 13, 1999 and January
26, 1999;
(d) Definitive Proxy Statement on Schedule 14A dated August 21, 1998; and
(e) The description of the Company's Common Stock set forth in the Registration
Statement on Form 8-A filed by the Company with the Commission on October
20, 1993, and any amendment or report filed for the purpose of updating any
such description.
We will provide without charge to each person, including any beneficial owner of
Class A Common Stock ("Common Stock"), to whom this Prospectus is delivered,
upon written or oral request of such person, a copy of any and all of the
documents that have been incorporated by reference in this Prospectus (not
including exhibits to such documents unless such exhibits are specifically
incorporated by reference therein). Requests should be directed to Bergen
Brunswig Corporation, 4000 Metropolitan Drive, Orange, California 92868-3510,
Attention: Milan A. Sawdei, Secretary; telephone number (714) 385-4255.
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You should rely only on the information contained or incorporated by reference
in this document. Bergen Brunswig Corporation has not authorized anyone to
provide you with information that is different. The Common Stock is not being
offered in any state where the offer is not permitted. You should not assume
that the information in this Prospectus is accurate as of any date other than
the date on the front of this Prospectus.
THE COMPANY
Bergen Brunswig Corporation, formed in 1956, and its subsidiaries (collectively,
the "Company") are a diversified drug and health care distribution organization
and, as such, the nation's largest supplier of pharmaceuticals to the managed
care market and the second largest wholesaler to the retail pharmacy market. The
Company is one of the largest pharmaceutical distributors to provide both
pharmaceuticals and medical-surgical supplies on a national basis.
SELLING SHAREHOLDERS
On September 4, 1998, the Company, BBMC-1 Merger Corp. ("BBMC-1"), BBMC-2 Merger
Corp. ("BBMC-2"), Ransdell Surgical, Inc. ("RSI") and Choice Medical, Inc.
("CMI") entered into an Agreement and Plans of Merger (the "Agreement").
Pursuant to the terms of the Agreement, BBMC-1 was merged with and into RSI (the
"RSI Merger") and the shareholders of RSI received, in exchange for their shares
of RSI stock, shares of Common Stock. Upon completion of that closing, the
Company and RSI filed a Certificate of Merger with the Secretary of State of
Kentucky, and the RSI Merger became effective as of September 30, 1998 (the "RSI
Effective Time"). Pursuant to the terms of the Agreement, BBMC-2 was merged with
and into CMI (the "CMI Merger"), and the shareholders of CMI received, in
exchange for their shares of CMI stock, shares of Common Stock. Upon completion
of that closing, the Company and CMI filed Articles of Merger with the Secretary
of State of Kentucky, and the CMI Merger became effective on September 30, 1998
(the "CMI Effective Time"). On December 1, 1998 the Company effected a
two-for-one stock split applicable to holders of record of the Company's Common
Stock on November 2, 1998 (the "Split"). As holders of record on November 2,
1998, the Selling Shareholders participated in the Split. Pursuant to the
Agreement:
(i) at the RSI Effective Time, the Company delivered an
aggregate of 529,784 (post-Split) shares of Common Stock
from the Company's treasury to its Transfer Agent of which
476,814 (post-Split) shares are to be transferred to the
Selling Shareholders, free of escrow, in proportion to
their respective outstanding interests in RSI stock upon
completion of the exchange process described in the
Agreement, and 52,970 (post-Split) shares are to be
delivered to an escrow agent on completion of the exchange
process;
(ii) at the CMI Effective Time, the Company delivered an
aggregate of 186,296 (post-Split) shares of Common Stock
from the Company's treasury to its Transfer Agent of which
167,672 (post-Split) shares are to be transferred to the
Selling Shareholders, free of escrow, in proportion to
their respective outstanding interests in CMI stock upon
completion of the exchange process described in the
Agreement, and 18,624 (post-Split) shares are to be
delivered to an escrow agent upon completion of the
exchange process; and
(iii) the Escrow Agent is required to return shares of
Common Stock to the Company in the event that (x) the
audited net worth of RSI and/or CMI should be less than
the respective guaranteed amounts, and (y) certain
indemnification claims are made by the Company, as set
forth in the Agreement.
No more than 716,080 (post-Split) shares of Common Stock, in the aggregate, will
be issued in connection with the Mergers. This prospectus covers all of the
shares of Common Stock which may be issued in connection with the Mergers and
which may be resold by such shareholders, as well as transferees of such
shareholders, pursuant to this offering.
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The following table sets forth information as to the number of shares of Common
Stock that will be beneficially owned by the Selling Shareholders, each of whom
will own less than one percent (1%) of the outstanding Common Stock of the
Company, assuming that a total of 716,080 (post-Split) shares of Common Stock,
including all those shares initially delivered to the Escrow Agent, will be
delivered to the Selling Shareholders as described above.
Selling Shareholders Number of Shares
(formerly shareholders of RSI) Owned Before Offering*
George W. Ransdell 18,126
Marie T. Ransdell 562
Michael R. Ransdell 115,066
Amy K. Ransdell 8,556
Letheris P. Sapanas 4,728
Jan R. Jaggers 17,732
Joseph H. Speiden 3,546
Richard Mohr 562
Ransdell Family, Ltd. 1 158,188
Ransdell Family #2, Ltd. 106,904
George W. Ransdell Irrevocable Trust 83,148
Ryan Ransdell 4,222
Camille Ransdell 4,222
Tiffany Ransdell 4,222
Selling Shareholders Number of Shares
(formerly shareholders of CMI) Owned Before Offering*
George W. Ransdell 31,890
Michael R. Ransdell 48,812
Ransdell Family Business Trust 1,870
Ransdell Family #2, Ltd. 45,558
William V. Bartoccini 36,202
George Puckett 21,964
*All numbers have been adjusted to reflect the Split. It is anticipated that
upon completion of this offering, the Selling Shareholders will not own any
shares of Common Stock. Prior to the Effective Time, none of the Selling
Shareholders had ever held any position or office or had any material
relationship with the Company or any of its subsidiaries.
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MANNER OF SALE
The Common Stock is listed on the New York Stock Exchange. It is anticipated
that the Selling Shareholders will sell the shares of Common Stock at the market
(that is, at the price in effect on the New York Stock Exchange at the time of
sale to investors). Sales will be effected by registered broker/dealers on the
New York Stock Exchange.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of Common Stock by the
Selling Shareholders.
FORWARD LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 (the "Act") provides a
"safe harbor" for "forward-looking statements" (as defined in the Act). This
Prospectus incorporates by reference forward-looking statements which reflect
the Company's current view (as of the date such forward-looking statement is
made) with respect to future events, prospects, projections or financial
performance. These forward-looking statements are subject to certain
uncertainties and other factors that could cause actual results to differ
materially from those made, implied or projected in such statements. These
uncertainties and other factors include, but are not limited to, uncertainties
relating to general economic conditions; the loss of one or more key customer or
supplier relationships, including pharmaceutical or medical-surgical
manufacturers for which alternative supplies may not be available; the
malfunction or failure of the Company's information systems; the costs and
difficulties related to the integration of recently acquired businesses; changes
to the presentation of financial results and position resulting from adoption of
new accounting principles or upon the advice of the Company's independent
auditors, or the staff of the Securities and Exchange Commission; changes in the
distribution or outsourcing pattern for pharmaceutical or medical-surgical
products, including any increase in direct distribution or decrease in contract
packaging by pharmaceutical manufacturers; changes in, or failure to comply
with, government regulations; the costs and other effects of legal and
administrative proceedings; competitive factors in the Company's healthcare
service businesses, including pricing pressures; the continued financial
viability and success of the Company's customers and suppliers; technological
developments and products offered by competitors; failure to retain or continue
to attract senior management or key personnel; risks associated with
international operations, including fluctuations in currency exchange ratios;
successful challenges to the validity of the Company's patents, copyrights
and/or trademarks; difficulties or delays in the development, production and
marketing of new products and services; strikes or other labor disruptions;
labor and employee benefit costs; pharmaceutical and medical-surgical
manufacturers' pricing policies and overall drug and medical-surgical supply
price inflation; changes in hospital buying groups or hospital buying practices;
and other factors referenced in documents incorporated by reference herein. The
words "believe," "expect," "anticipate," "project," and similar expressions
identify "forward-looking statements," which speak only as of the date the
statement was made. The Company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
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RECENT DEVELOPMENTS
On December 31, 1998, Bergen Brunswig Corporation ("Bergen") completed
the acquisition of substantially all of the business, assets and property,
subject to certain liabilities, of Medical Initiatives, Inc. ("MII"), a
pre-filler of pharmaceuticals for oncology centers, located in Tampa, Florida.
Bergen issued approximately 210,000 shares of Bergen Common Stock, previously
held as treasury shares, valued at approximately $6.3 million, acquired assets
at fair value of approximately $1.2 million, assumed liabilities of
approximately $0.7 million and incurred costs of $0.2 million.
On January 21, 1999, Bergen completed the acquisition of Stadtlander
Drug Company, Inc. ("Stadtlander"), a national leader in disease-specific
pharmaceutical care delivery for transplant, HIV, infertility and serious mental
illness patient populations and a leading provider of pharmaceutical care to the
privatized corrections market, headquartered in Pittsburgh, Pennsylvania. Bergen
paid approximately $197.3 million in cash and issued approximately 5.7 million
shares of Bergen Common Stock, previously held as Treasury shares, valued at
approximately $140.8 million, and assumed indebtedness of approximately $100.9
million.
A United States federal investigation of Stadtlander with respect to
possible violations of the Medicare provisions of the Social Security Act is
being conducted. The activities under investigation predated the ownership of
Stadtlander by Counsel Corporation ("Counsel"). Bergen has been advised that
while owned by Counsel, Stadtlander cooperated fully with the authorities
investigating this matter. Stadtlander has also been named as a defendant in
legal proceedings commenced in the U.S. District Court, Northern District of
Texas, Dallas Division, asserting, among other things, that by entering into a
transaction with a third-party, Stadtlander interfered with the plaintiff's
relationship with that third-party. This proceeding is in a preliminary stage.
In addition, Stadtlander is a 49% equity owner of a limited liability company
formed for the purpose, among other things, of operating a specialty
pharmaceutical business to provide services to patients diagnosed with a serious
mental illness. This limited liability company is governed by an operating
agreement that contains, among other things, a covenant prohibiting the members
from participating in certain competing activities. The other member of the
limited liability company has asserted that upon consummation of the merger of a
wholly owned subsidiary of Bergen with and into PharMerica Inc. ("PharMerica"),
PharMerica would be subject to the non-compete provisions of the operating
agreement unless certain activities currently performed by PharMerica were
performed through the limited liability company. Bergen disputes this position.
Counsel has agreed to provide certain indemnification to Bergen with respect to
each of the matters described in this paragraph.
On February 10, 1999, Bergen completed the acquisition of 100% of the
capital stock of J.M. Blanco, Inc. ("J.M. Blanco"), Puerto Rico's largest
pharmaceutical distributor, headquartered in Guaynabo, Puerto Rico. The Company
paid approximately $29.7 million in cash and assumed approximately $22.2 million
in debt.
The purchase prices of the MII, Stadtlander and J.M. Blanco
acquisitions, to be accounted for as purchases for financial reporting purposes,
are subject to adjustments after the completion of acquisition audits.
EXPERTS
The consolidated financial statements of the Company incorporated in this
Prospectus by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended September 30, 1998, have been audited by Deloitte & Touche
(LLP), independent auditors, as stated in their report, which is incorporated
herein by reference, and have been so incorporated in reliance upon the report
of such firm given upon their authority as experts in accounting and auditing.
