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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
(AMENDMENT NO. 14)
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D
(AMENDMENT NO. 14)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
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SHOREWOOD PACKAGING CORPORATION
(Name of Subject Company)
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CHESAPEAKE CORPORATION
SHEFFIELD, INC.
(Bidders)
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Common Stock, $0.01 Par Value Per Share
(Including Associated Rights)
(Title of Class of Securities)
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825229107
(CUSIP Number of Class of Securities)
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Thomas H. Johnson
President & Chief Executive Officer
Chesapeake Corporation
1021 East Cary Street
Richmond, Virginia 23218-2350
(804) 697-1000
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
Copies to:
Gary E. Thompson, Esq.
Hunton & Williams
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219-4074
(804) 788-8200
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February 16, 2000
(Date of Event Which Requires Filing of This Statement)
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This Amendment No. 14 to Schedule 14D-1 supplements and amends the Tender
Offer Statement on Schedule 14D-1, filed on December 3, 1999 (as amended, the
"Schedule 14D-1"), by Sheffield, Inc., a Delaware corporation ("Purchaser"),
and Chesapeake Corporation ("Chesapeake"), a Virginia corporation and the
direct owner of all of the outstanding capital stock of Purchaser. The
Schedule 14D-1 relates to the offer by Purchaser to purchase all outstanding
shares of common stock, $0.01 par value per share (the "Common Stock"),
including the associated rights to purchase preferred stock (the "Rights" and
together with the Common Stock, the "Shares"), of Shorewood Packaging
Corporation, a Delaware corporation (the "Company"), not directly or
indirectly owned by Chesapeake and its subsidiaries, for a purchase price of
$17.25 per Share, net to the seller in cash, without interest thereon, on the
terms and subject to the conditions set forth in the Offer to Purchase, dated
December 3, 1999 (the "Offer to Purchase"), and in the related Letter of
Transmittal and any amendments or supplements thereto (which collectively
constitute the "Offer"). Capitalized terms used and not otherwise defined
herein have the meanings set forth in the Schedule 14D-1. This Amendment No.
14 to Schedule 14D-1 also constitutes Amendment No. 14 to the statement on
Schedule 13D of Purchaser and Chesapeake, filed on November 30, 1999.
Item 3. Past Contacts, Transactions or Negotiations with the Subject Company
(b) The text of Section 10 of the Offer to Purchase is hereby amended and
supplemented by adding thereto the following:
On February 15, 2000, Greenhill & Co., L.L.C., financial advisor to the
Company, sent the following letter to Goldman, Sachs & Co. and Donaldson,
Lufkin & Jenrette, financial advisors to Chesapeake and Purchaser:
[Greenhill & Co., L.L.C. Letterhead]
February 15, 2000
Mr. Ravi Sinha
Managing Director
Goldman, Sachs & Co.
85 Broad Street, 18th Floor
New York, NY 10004
Mr. Douglas Brown
Managing Director
Donaldson, Lufkin & Jenrette
277 Park Avenue, 20th Floor
New York, NY 10172
Gentlemen:
As a follow up to our discussions yesterday and in anticipation of your
meeting today in which Howard Liebman, President and Chief Financial Officer
of Shorewood, is available to answer questions concerning the Company's
business plan which was delivered to you following execution of the
confidentiality agreement, we wanted to be clear about our timing. Mr. Liebman
will also be available to answer financial questions concerning the quarter
ended January 31, 2000, the preliminary revenue estimates for which were
disclosed to you yesterday.
Meetings of the Shorewood Board of Directors and Special Committee were held
yesterday afternoon for the purpose of updating the Board on events. You were
informed over the weekend that the Board was meeting yesterday for this
purpose. The Board understands from your prior disclosures that, following
access to the Company's business plan, you may be in a position to increase
your offer and merger proposal.
The Board has scheduled another meeting for tomorrow afternoon and requests
that you provide the Board with Chesapeake's best and final offer and proposal
as soon as possible. This is consistent with the advice we have given you that
time is short. In view of your imminent consent solicitation, the Board is
concerned with the risks associated with any delay in its consideration of
alternatives and expects to consider any alternatives or proposals that may be
available to it at its meeting tomorrow afternoon. Accordingly, if you desire
to revise your offer and proposal and
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wish to have it considered by the Board at this meeting, you are on notice
that this is the time to bring any such revisions or proposals before the
Board. If there are any significant conditions to your proposal (other than
those disclosed in your public filings), they should be highlighted. In
addition, the source and status of your financing should be disclosed to the
Board. Please understand that, while there can be no assurance, the Board may
be in a position to take final action tomorrow, including the possible grant
of breakup fee protection to any bidder associated with a proposal which is
considered in the best interests of all stockholders.
The meeting of the Shorewood Board will commence at 4:00 p.m. tomorrow,
February 16, 2000. If you wish any clarification prior to that time or desire
to discuss any aspect of your proposal, we are available to answer your
inquiries.
Sincerely,
/s/ Scott L. Bok
Scott L. Bok
Managing Director
On February 16, 2000, Chesapeake issued the following press release which
contained the full text of a letter which was sent on such date by Chesapeake
to the Company's financial advisors:
[CHESAPEAKE CORPORATION LOGO]
CHESAPEAKE REJECTS SHOREWOOD'S ATTEMPT TO SET BID DEADLINE;
URGES SHOREWOOD TO ENGAGE IN NEGOTIATIONS
Richmond, VA. (February 16, 2000) Chesapeake Corporation (NYSE:CSK) today
announced that it has rejected an apparent attempt by Shorewood Packaging
Corporation (NYSE:SWD) to set a bidding deadline in connection with the
Shorewood Board's consideration of alternatives for the company. Chesapeake
reiterated its willingness to negotiate in good faith concerning its fully
financed $17.25 per share all cash offer for Shorewood, and again requested
access to customary due diligence materials and the opportunity for face-to-
face negotiations.
Chesapeake noted that it signed a confidentiality agreement with Shorewood on
Monday, February 14, and thereafter received less than 60 pages of rudimentary
information from Shorewood. The next day, representatives of Chesapeake met
with Shorewood to review that information. However, prior to that meeting,
Shorewood set a 24-hour deadline for Chesapeake to provide Shorewood with its
"best and final offer and proposal."
Chesapeake also announced that it sent the following letter to Shorewood's
financial advisors in connection with the apparent bidding deadline:
February 16, 2000
Mr. Scott L. Bok
Managing Director
Greenhill & Co., LLC
31 West 52nd Street, 16th Floor
New York, NY 10004
Dear Scott:
We are in receipt of your letter of February 15, which appears to set an
artificial deadline of 4:00 PM today for Chesapeake to provide Shorewood with
its "best and final proposal."
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As you are well aware, since November 10, 1999, Chesapeake has repeatedly
invited Shorewood's Board to engage in serious negotiations regarding the
price and structure of our offer. During that three month period, Shorewood
claims to have made available due diligence materials, and engaged in
substantive discussions, with other interested parties regarding a possible
transaction, while excluding Chesapeake from that process. Only after the
sweeping decision of the Delaware Chancery Court which, among other things,
found that the Shorewood Board acted in a "grossly inadequate" and "grossly
uninformed" fashion in the face of Chesapeake's proposal, did Shorewood offer
Chesapeake access to any due diligence materials.
It now appears that Shorewood's due diligence offer may be illusory. As you
know, the parties entered into a confidentiality agreement late on Monday,
February 14. Thereafter, Shorewood provided us with less than 60 pages of the
most rudimentary information. The very next day--before any opportunity for
access to customary due diligence materials or discussions--we received your
letter with its 24 hour trigger and threat that the Shorewood Board may enter
into a transaction with a third party later today, possibly including the
grant of a breakup fee.
We believe that such deadline and threat are patently unreasonable, and that
Chesapeake has not been afforded a level playing field in its attempts to
refine its offer for Shorewood. Accordingly, Chesapeake reserves the right to
challenge in court any such alternative transaction by Shorewood.
As you know, within 24 hours of receiving Shorewood's rudimentary information
package, representatives of Chesapeake met in New York with Mr. Howard
Liebman, President & CFO of Shorewood, to review the information. During the
course of that 2 hour meeting, we were advised of certain material non-public
information concerning Shorewood's recent performance.
In light of that non-public information, and our stated requirement for
customary, limited due diligence to permit us to refine our offer, we
delivered a short due diligence request list to Mr. Liebman this morning. As
we advised your counsel this afternoon, we stand ready to work with Shorewood
to accommodate Shorewood's concerns about disclosing competitively sensitive
information and information that would be unduly burdensome to assemble. We
continue to expect that, with prompt and reasonable access to due diligence
materials and the opportunity for meaningful face-to-face negotiations,
Chesapeake will be in a position to advise you of any revisions to our offer
in advance of the expected record date for our consent solicitation.
Chesapeake remains willing to negotiate in good faith with the Shorewood Board
regarding our fully financed $17.25 per share all cash offer. We believe it is
in the best interests of Shorewood's stockholders for Chesapeake to have the
benefit of access to customary due diligence, and the opportunity for face-to-
face negotiations, to develop our "best and final offer and proposal."
We trust that Shorewood will reconsider its unreasonable deadline, and will
enter into prompt and constructive negotiations with Chesapeake.
Very truly yours,
/s/ Andrew J. Kohut
Andrew J. Kohut
cc: Mr. Howard M. Liebman
Jeffrey W. Tindell, Esq.
This news release may contain forward-looking statements that are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. While the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 are not applicable to forward-looking statements
made in connection with a tender offer, it has not been judicially determined
whether such safe harbor provisions apply to forward-looking statements in a
consent solicitation conducted in connection with a tender offer. The accuracy
of such forward-looking statements is subject to a number of risks,
uncertainties, and assumptions that may cause Chesapeake's actual results to
differ materially from those expressed in the forward-looking statements
including, but not limited to: competitive products and pricing; production
costs, particularly for raw materials
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such as corrugated box, folding carton and display materials; fluctuations in
demand; government policies and regulations affecting the environment; interest
rates; currency translation movements; and other risks that are detailed from
time to time in reports filed by the Company with the Securities and Exchange
Commission.
CERTAIN INFORMATION CONCERNING PARTICIPANTS
Chesapeake Corporation ("Chesapeake") and Sheffield, Inc., a wholly owned
subsidiary of Chesapeake ("Purchaser"), and certain other persons named below
may be deemed to be participants in a consent solicitation (the "Consent
Solicitation") that may be conducted by Chesapeake and Purchaser in connection
with the tender offer (the "Offer") by Purchaser to purchase all of the
outstanding shares of common stock ("Shares") of Shorewood Packaging
Corporation ("Shorewood") for $17.25 per Share net to the seller in cash. The
participants in this solicitation may include: (i) the directors of Chesapeake
(Harry H. Warner, Chairman of the Board; Thomas H. Johnson, President & Chief
Executive Officer; Robert L. Hintz; James E. Rogers; John W. Rosenblum; Frank
S. Royal; Wallace Stettinius; Richard G. Tilghman; Joseph P.Viviano; and Hugh
V. White, Jr.); and (ii) certain officers of Chesapeake: J.P. Causey Jr.,
Senior Vice President, Secretary & General Counsel; Andrew J. Kohut, Senior
Vice President-Strategic Business Development; Octavio Orta, Executive Vice
President-Display & Packaging; William T. Tolley, Senior Vice President-Finance
& Chief Financial Officer; Molly Remes, Director-Corporate Communications; and
Joel Mostrom, Vice President-Investor Relations. As of the date of this
communication, approximately 14.9% of the outstanding Shares of Shorewood, or
approximately 4.1 million Shares, are beneficially owned by Chesapeake and
Purchaser (including Shares to be purchased pursuant to a stock purchase
agreement between Chesapeake and a third-party). Chesapeake has retained
Goldman, Sachs & Co. ("Goldman Sachs") and Donaldson, Lufkin & Jenrette
Securities Corporation ("DLJ") to act as its co-financial advisors in
connection with the Offer, for which Goldman Sachs and DLJ will receive
customary fees, as well as reimbursement of reasonable out-of-pocket expenses.
Chesapeake and Purchaser have retained Goldman Sachs and DLJ to act as their
Co-Dealer Managers in connection with the Offer, for which Goldman Sachs and
DLJ will receive customary fees, as well as reimbursement of reasonable out-of-
pocket expenses. In addition, Chesapeake and Purchaser have agreed to indemnify
Goldman Sachs and certain related persons and DLJ and certain related persons
against liabilities, including certain liabilities under the federal securities
laws, arising out of each of their engagements. Neither Goldman Sachs nor DLJ
admits that they or any of their respective partners, directors, officers,
employees, affiliates or controlling persons, if any, is a "participant" as
defined in Schedule 14A promulgated under the Exchange Act in the solicitation
of proxies and/or consents, or that Schedule 14A requires the disclosure of
certain information concerning Goldman Sachs or DLJ. In connection with Goldman
Sachs' role as Co-Dealer Manager to Chesapeake and Purchaser, the following
investment banking employees of Goldman Sachs may communicate in person, by
telephone or otherwise with a limited number of institutions, brokers or other
persons who are stockholders of Shorewood and may solicit consents from these
institutions, brokers or other persons: Ravi Sinha, George Mattson, James
Katzman, Peter Comisar and Jason Gilbert. In connection with DLJ's role as Co-
Dealer Manager to Chesapeake and Purchaser, the following investment banking
employees of DLJ may communicate in person, by telephone or otherwise with a
limited number of institutions, brokers or other persons who are stockholders
of Shorewood and may solicit consents from these institutions, brokers or other
persons: L. Price Blackford, Doug Brown, Daniel Schleifman, Robert Simensky and
Andrew Kramer. Goldman Sachs and DLJ each engage in a full range of investment
banking, securities trading, market-making
and brokerage services for institutional and individual clients. In the normal
course of its business Goldman
Sachs and/or DLJ may trade securities of Shorewood for each of their own
accounts and the accounts of their customers and, accordingly, may at any time
hold a long or short position in such securities. Goldman Sachs and DLJ has
each informed Chesapeake that, as of the date hereof, neither of them holds any
Shares for its own account. Goldman Sachs or DLJ and/or certain of their
respective affiliates may have voting and dispositive power with respect to
certain Shares held in asset management, brokerage and other accounts. Goldman
Sachs, DLJ, and each such of their respective affiliates disclaim beneficial
ownership of such Shares.
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Other than as set forth herein, to the knowledge of Chesapeake and Purchaser,
as of the date of this communication, none of Chesapeake, Purchaser, any of
their respective directors, executive officers, employees or other
representatives, or other persons known to Chesapeake or Purchaser who may
solicit consents has any interest, direct or indirect, in Shorewood by
security holding or otherwise.
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For media relations, call: For investor relations, call:
Molly Remes William Tolley/Joel Mostrom
804-697-1110 804-697-1157/804-697-1147
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Joele Frank/Josh Silverman
J. Frank Associates
212-355-4449 ext. 107/121
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SIGNATURES
After due 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.
Dated: February 16, 2000
CHESAPEAKE CORPORATION
/s/ J. P. Causey Jr.
By: ____________________________
J. P. Causey Jr.
Senior Vice President, Secretary
& General Counsel
SHEFFIELD, INC.
/s/ J. P. Causey Jr.
By: ____________________________
J. P. Causey Jr.
Vice President & Secretary
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