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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): April 13, 1999
HARRIS CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 1-3863 34-0276860
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
1025 West NASA Blvd., Melbourne, FL 32919
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (407) 727-9100
No Change
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(Former name or former address, if changed since last report.)
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Items 1-4. Not Applicable.
Item 5. Other Events.
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On April 13, 1999, Harris Corporation ("Harris" or the
"Company") announced two initiatives designed to increase shareholder value and
position Harris and its Lanier Worldwide subsidiary for significant growth.
First, Harris will undertake specific actions to reposition itself to become a
pure communications equipment company. Near-term repositioning actions for
Harris include: realigning the commercial and government businesses into one
company with six divisions; actively pursuing acquisitions, alliances and
partnerships to expand Harris' position in the global communications equipment
market; eliminating the Company's sector organizational level; streamlining
overhead structure, including the reduction of staff positions; and selling the
power semiconductor operation, including fabrication and assembly facilities.
Second, in a separate initiative, Harris announced its
intention to spin-off its Lanier Worldwide subsidiary as an independent,
publicly traded company. The spin-off is expected to take the form of a tax-free
stock dividend of Lanier stock and is subject to final approval of Harris' Board
of Directors and formal declaration of the dividend.
A copy of the press release is filed herewith as Exhibit 99
and is incorporated herein by reference.
Item 6. Not Applicable.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits.
The following document is filed as an Exhibit to this Report:
99. Press Release, dated April 13, 1999, announcing
Harris' plans to reposition the Company to become a
pure communications equipment company and to spin-off
its Lanier Worldwide subsidiary to its shareholders
in the form of a tax-free stock dividend.
Items 8-9. Not Applicable.
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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.
HARRIS CORPORATION
By: /s/ David S. Wasserman
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Name: David S. Wasserman
Title: Vice President & Treasurer
Date: April 14, 1999
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EXHIBIT INDEX
Exhibit No.
Under Reg.
S-K, Item 601 Description
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99 Press Release, dated April 13, 1999,
announcing Harris' plans to reposition
the Company to become a pure
communications equipment company and to
spin-off its Lanier Worldwide subsidiary
to its shareholders in the form of a
tax-free stock dividend.
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EXHIBIT 99
HARRIS CORPORATION REPOSITIONING TO FOCUS ON COMMUNICATIONS;
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ANNOUNCES PLANS TO SPIN-OFF LANIER WORLDWIDE TO SHAREHOLDERS
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NEW YORK, NY / MELBOURNE, FL, April 13, 1999 - Harris Corporation today
announced two initiatives designed to increase shareholder value and position
Harris and its Lanier Worldwide subsidiary for significant growth.
The company will undertake specific actions to reposition the company
to become a pure communications equipment company. In addition, Harris will spin
off its highly-successful Lanier Worldwide subsidiary to its shareholders. These
initiatives will create two leading companies in their respective markets -
communications and office equipment.
"Harris is involved in many of today's most dynamic, fast-moving
markets. To be competitive, we need to be focused and agile, with the
flexibility to react quickly to market requirements," said Phillip W. Farmer,
chairman and CEO of Harris. "For Harris, our primary objective is to combine the
wide-ranging technical and business resources of Harris into a single
high-technology enterprise focused on worldwide communications markets."
The near-term repositioning actions for Harris include:
- - Realigning the commercial and government businesses into one company with
six divisions, each focused on specific communications markets.
- - Actively pursuing acquisitions, alliances and partnerships to expand
Harris' current position in the global communications equipment market.
- - Eliminating the company's sector organization level.
- - Streamlining the overhead structure, including the reduction of 300-400
staff positions, which is expected to result in an annual savings of $20 to
$30 million.
- - Selling the power semiconductor operation, including fabrication and
assembly facilities in Pennsylvania, Ohio, Ireland and Malaysia.
-more-
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"The spin-off of Lanier, which was authorized by the Harris Board of
Directors today, subject to formal declaration of the dividend at a later date,
is a separate initiative that is expected to meaningfully enhance value for our
shareholders. Lanier's seasoned management team has the company well poised for
growth," Mr. Farmer said. "This is evident by their recent strategic actions,
such as a successful acquisition that doubled their European business and by
their newly formed global marketing alliance with Hewlett Packard. The spin-off
will heighten management's focus, provide them with greater access to capital to
achieve their growth initiatives, and allow the investment community to measure
Lanier's performance relative to its peers."
Wes Cantrell, president of Lanier, said, "We are extremely excited
about the opportunity to become a public company. We believe we are
well-positioned to compete effectively, and look forward to establishing a
productive dialogue with the investment community and delivering meaningful
value to our shareholders."
The Lanier transaction, which is expected to take the form of a
tax-free spin-off to Harris shareholders, is planned to be finalized this
summer.
Repositioning Harris
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Harris' Board of Directors previously authorized management to explore
the sale of the company's commodity power semiconductor business. Discussions
are underway with several potential buyers for the $300 million business, which
is part of Harris' overall semiconductor operation. The business includes the
world's only 8-inch wafer power fabrication facility, in Mountaintop,
Pennsylvania; other fabrication and assembly operations in Ohio and Ireland;
along with a major test-and-assembly facility in Kuala Lumpur, Malaysia. The
company expects proceeds from the divestiture to reduce indebtedness at Harris.
-more-
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Following these actions, Harris will be a much more integrated
organization with six divisions and about 12,000 employees, all focused on
communications. Harris will provide communications equipment, systems and
support services - concentrating on the wireless, broadcast, government systems
and network support markets. This business represents about $2.3 billion of
Harris' total revenue of about $3.9 billion in the current fiscal year, ending
July 2. The repositioning initiatives are independent of the Lanier spin-off.
The new streamlined organization will feature shared services and joint
marketing and technology development to leverage the strengths of the company's
broad breadth of talent and technology. The company plans to add to its current
line of systems and services in such areas as IP-based broadband wireless access
systems, point-to-point microwave products, video compression products,
next-generation wireless LAN chip sets, expanded network management and testing
applications, commercial space communications systems and other natural product
line extensions.
"Harris has developed a wealth of communications technology and
customer knowledge during our 104-year history," said Mr. Farmer. "As a company
focused purely on communications, we will be able to more aggressively address
this global market and provide more value-added solutions to our worldwide base
of customers."
Lanier
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Describing the Lanier Worldwide action, Mr. Farmer said Harris plans to
spin off Lanier as an independent, publicly traded company under the same name.
The spin-off will take the form of a tax-free stock dividend of Lanier stock.
The spin-off is expected to take 4-6 months to complete and is subject to the
final approval of the Harris Board of Directors and formal declaration of the
dividend. The new company will apply for listing on the NYSE. Harris expects
that Lanier will have a capital structure appropriate to its business.
Headquartered in Atlanta, Lanier has about 10,000 employees in more than 1600
sales and service offices around the world, with sales this fiscal year of about
$1.5 billion.
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"Lanier has been a stellar performer in the office equipment industry -
providing a strong line of copiers, fax and dictation products - outpacing many
of its competitors for the past 10 years," Mr. Farmer said. "Spinning Lanier off
as a highly-successful independent company will reward our shareholders and give
Lanier operational and financial flexibility to take advantage of significant
growth opportunities in their industry."
This press release contains forward-looking statements made in reliance
upon the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements reflect management's current
assumptions and estimates of future performance and economic conditions. The
company cautions investors that any forward-looking statements are subject to
risks and uncertainties that may cause actual results and future trends of the
company to differ materially from those matters expressed in or implied by such
forward-looking statements. The company's consolidated results and the
forward-looking statements could be affected by, among other things, general
economic conditions in the markets in which the company operates; economic
developments that have a particularly adverse effect on one or more the of the
markets served by the company; the ability to execute management's repositioning
as a pure communications company (including management's plan to modify its
internal structure and divest non-core businesses); stability of key markets for
communications products, particularly Asia and Brazil; fluctuation in foreign
currency exchange rates and the effectiveness of the company's currency hedging
program; worldwide demand and product pricing for integrated semiconductor
circuits; reductions in the U.S. and worldwide defense and space budgets; effect
of continuing consolidation in the U.S. defense industry on the company's direct
and indirect business with the U.S. government; the company's ability to recover
costs incurred on fixed price contracts; continued development and market
acceptance of new products, especially digital television broadcast products and
semiconductor wireless products; continued success of the company's patent
licensing programs; the ability of Harris, its customers, and suppliers to
become Year 2000 compliant; and the successful resolution of patent infringement
and other general litigation. Harris disclaims any intention or obligation to
update or revise any forward-looking statements, whether as a result of new
information, future events, or otherwise.
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Media inquiries: Jim Burke at 407-727-9126 [email protected].
Investor relations inquiries: Pamela Padgett at 407-727-9383
[email protected].
A conference call for the investment community will be held at 8:30 a.m.,
Eastern Standard Time, on Wednesday, April 14, 1999. On the conference call will
be Phillip W. Farmer, Chairman and CEO; Bryan R. Roub, Senior Vice President and
CFO; and Pamela M. Padgett, Vice President-Investor Relations. Participants can
access the call by dialing 1-877-502-9272. A taped replay of the call will be
made available.
