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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 4 TO
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMPUTER SCIENCES CORPORATION
(Name of Subject Company)
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CAI COMPUTER SERVICES CORP.
COMPUTER ASSOCIATES INTERNATIONAL, INC.
(Bidder)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK PURCHASE RIGHTS
(Title of Class of Securities)
20536310-4
(CUSIP Number of Class of Securities)
SANJAY KUMAR
PRESIDENT AND CHIEF OPERATING OFFICER
C/O COMPUTER ASSOCIATES INTERNATIONAL, INC.
ONE COMPUTER ASSOCIATES PLAZA
ISLANDIA, NEW YORK 11788-7000
TELEPHONE: (516) 342-5224
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
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COPIES TO:
SCOTT F. SMITH, ESQ.
HOWARD, DARBY & LEVIN
1330 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10019
TELEPHONE: (212) 841-1000
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This Statement amends and supplements the Tender Offer Statement on Schedule
14D-1 filed with the Securities and Exchange Commission on February 17, 1998, as
amended (the "Schedule 14D-1"), relating to the offer by CAI Computer Services
Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of
Computer Associates International, Inc., a Delaware corporation ("Computer
Associates"), to purchase all outstanding shares of Common Stock, par value
$1.00 per Share, of Computer Sciences Corporation, a Nevada corporation,
together with (unless and until the Purchaser declares that the Rights Condition
has been satisfied) the Series A Junior Participating Preferred Stock Purchase
Rights associated therewith, upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated February 17, 1998 (the "Offer to
Purchase"), and in the related Letter of Transmittal, at a purchase price of
$108 per Share (and associated Right) net to the tendering stockholder in cash,
without interest thereon. Capitalized terms used and not defined herein shall
have the meanings assigned to such terms in the Offer to Purchase and the
Schedule 14D-1.
ITEM 10. ADDITIONAL INFORMATION.
On February 24, 1998, Computer Associates sent a letter to Computer Sciences
Corporation Chairman Van Honeycutt. A copy of the letter is attached hereto as
Exhibit (a)(11) and is incorporated herein by reference.
On February 25, 1998, Computer Associates issued a press release outlining
actions Computer Associates is taking to prevent Computer Sciences Corporation's
management and directors from interfering with shareholders' rights to accept
Computer Associates' all-cash $108 per share offer. A copy of the press release
is attached hereto as Exhibit (a)(12) and is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<S> <C>
(a)(11) Text of letter sent to Van Honeycutt by Computer Associates dated February 24,
1998.
(a)(12) Text of press release issued by Computer Associates dated February 25, 1998.
</TABLE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: February 25, 1998
CAI COMPUTER SERVICES CORP.
By /s/ PETER SCHWARTZ
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Name: Peter Schwartz
Title: Vice President and Treasurer
COMPUTER ASSOCIATES INTERNATIONAL, INC.
By /s/ PETER SCHWARTZ
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Name: Peter Schwartz
Title: Senior Vice President and
Chief Financial Officer
2
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT NAME
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<S> <C>
(a)(11) Text of letter sent to Van Honeycutt by Computer Associates dated February 24, 1998.
(a)(12) Text of press release issued by Computer Associates dated February 25, 1998.
</TABLE>
3
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Exhibit (a)(11)
Letter To Computer Sciences Corporation
February 24, 1998
VIA FAX TO (310) 615-3950
Mr. Van B. Honeycutt
Chairman and CEO
Computer Sciences Corporation
2100 East Grand Street
El Segundo, CA 90245
Dear Van:
Sanjay and I thank you for your letter of February 19.
We have previously addressed with you the business operation and people
points outlined in your letter. Since we have already, as well, set forth
our views in letters to you on February 6 and 10, we do not see a purpose
in debating the points or what you have said to us in the past. We also
agree with your last comment -- that we should move on -- and promptly put
the issue to the shareholders in a fair referendum.
We also want to confirm again to you our commitments:
TO CSC MANAGEMENT AND EMPLOYEES:
CA is committed to continue CSC's business with
the same management and people. Because we
value tremendously what they have accomplished,
we have already stated that we intend to retain all
CSC employees. We are excited about what more
we can accomplish together when combining CSC's
people with CA's superior software products and
people.
TO CSC CLIENTS (MANY OF WHOM WE
ALREADY SHARE):
We are committed to maintaining the highest quality
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service in the best CSC tradition. Many of the clients
we have spoken with have expressed enthusiasm for
the benefits they would receive from a combination
of our businesses. We look forward to enhancing the
product offerings and services that a combined
CA/CSC will be able to provide.
TO CSC SHAREHOLDERS:
We are committed to allowing the CSC shareholders
the opportunity to decide whether to accept our offer
in a fair referendum at the earliest possible date.
We believe that our offer is fair and adequate. Just two months ago,
your stock was trading in the low $80s, which then represented an all
time high. In fact, your stock price has increased very slowly over the
last two years. Our offer is at a substantial premium to your current
and historical prices, and we believe it will prove very attractive to
your shareholders. While we still prefer a negotiated transaction,
alternatively, we would encourage you and Computer Sciences' Board of
Directors to put our unilateral offer to the CSC shareholders without
delay. In this way, both companies will be able to move on -- into the
next millennium as a world class information solutions provider.
Very truly yours,
/s/ Charles B. Wang
Charles B. Wang
Chairman and Chief
Executive Officer
cc:
Board of Directors
of Computer Sciences Corporation
* * * * * * * * *
Computer Associates and the Computer Associates Nominees are
participants in the solicitation of consents, proxies and agent
designations from Computer Sciences Corporation shareholders. The
Computer Associates nominees are Charles B. Wang, Sanjay Kumar, Russell
Artzt,
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Peter A. Schwartz, Steven M. Woghin, Charles P. McWade, Ira Zar, Michael
A. McElroy, David Kaplan, Robert Toth, Richard Chiarello, Lisa Savino,
Gary Quinn, Abraham Poznanski and Douglas Robinson. None of the Computer
Associates Nominees will receive any additional compensation for their
participation in this solicitation.
Computer Associates own, through a wholly owned subsidiary, 170,000
shares of common stock of Computer Sciences Corporation. None of the
Computer Associates Nominees owns any shares of Computer Sciences common
stock.
Computer Associates has also retained Bear, Stearns & Co. Inc. and its
affiliates ("Bear Stearns") to provide certain financial advisory
services o Computer Associates. Bear Stearns is acting as Dealer Manager
in connection with the Offer and as financial advisor to Computer
Associates and CAI Computer Services Corp., a wholly owned subsidiary of
Computer Associates, in connection with the proposed acquisition of the
Company, but Bear Stearns has not been retained to specifically assist
in this solicitation. Computer Associates is obligated to pay to Bear
Stearns, if, s more fully described in the engagement letter relating to
Bear Stearns' engagement, during the term of the engagement or within 12
months thereafter Computer Associates acquires the Company or more than
50% of its outstanding voting securities, a fee of $5 million and a fee
of $1 llion (which will be credited against such $5 million fee) if
Computer Associates requests Bear Stearns to render a customary fairness
opinion. Bear Stearns is also entitled to act as sole lead underwriter,
placement agreement and financial advisor in connection with certain
debt and equity financings (and certain refinancings) and certain asset
sales for a specified period following the acquisition and to receive
fees in connection therewith. In addition, Computer Associates has
agreed to reimburse Bear Stearns for its reasonable expenses, including
reasonable fees and disbursements of its counsel, incurred in rendering
its services under its engagement agreement with Computer Associates and
has agreed to indemnify Bear Stearns against certain liabilities and
expenses in connection with the Offer and the Proposed Merger, including
certain liabilities under the federal securities laws. Bear Stearns from
time to time renders various investment banking services to Computer
Associates and its affiliates for which it is paid customary fees.
In connection with Bear Stearns' engagement as financial advisor,
Computer Associates anticipates that Michael J. Urfirer, Senior Managing
Director of Bear Stearns, Lisa M. Price, Senior Managing Director of
Bear Stearns and Barry J. Cohen, Senior Managing Director of Bear
Stearns, none of whom will receive additional compensation for such
solicitation, may communicate in person, by telephone or otherwise
with a limited number of
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institutions, brokers or other persons who are shareholders for the
purpose of assisting in this solicitation. Bear Stearns will not receive
any fee for, or in connection with, such solicitation activities by its
employees apart from the fees it is otherwise entitled to receive as
described above. None of the above-named employees of Bear Stearns owns
any shares of Computer Sciences Corporation common stock.
<PAGE>
Exhibit (a) (12)
Contact:
Bob Gordon, CA
Doug Robinson, Investor Relations
(516) 342-2391
(516) 342-2745
[email protected]
[email protected]
CA ACTS TO PREVENT CSC MANAGEMENT'S INTERFERENCE WITH
SHAREHOLDER RIGHTS
ISLANDIA, N.Y., February 25, 1998--In a letter to shareholders of
Computer Sciences Corporation, Charles B. Wang, Computer Associates Chairman
and CEO, outlined actions CA is taking to prevent CSC's management and
directors from interfering with shareholders' rights to accept CA's all-cash
$108 per share offer. CA announced that its senior management will meet with
CSC and CA stockholders to discuss the offer and the steps CA is taking to
complete the offer.
"Last Wednesday, CSC's directors adopted bylaw amendments with the
intent of entrenching themselves and disenfranchising you, the owners of
CSC," Mr. Wang stated. "They are seeking to make it virtually impossible for
shareholders to amend the bylaws or remove a majority of the board. We are
committed to giving you, the CSC shareholders, the opportunity to decide
whether to accept our offer in a fair referendum at the earliest possible
date." According to Mr. Wang, this action, along with the adoption of
lucrative compensation packages for CSC executives, places the interest of
CSC management ahead of the interests and rights of its shareholders. "We
view the actions of the CSC Board as an unfortunate and extreme reaction to
our offer," Mr. Wang said in his letter, posted at http://www.cai.com/csc.
"We are confident that these actions will be dismantled by the court."
On Monday, CA amended its complaint against CSC in Federal District Court in
Nevada to strike the bylaw amendments.
Yesterday, Mr. Wang stated in a letter to CSC Chairman and CEO Van B.
Honeycutt, "We believe that our offer is fair and adequate. Just two months
ago, your stock was trading in the low $80s, which then represented an
all-time high. In fact, your stock price has increased very slowly over the
last two years. Our offer is at a substantial premium to your current and
historical prices, and we believe it will prove very attractive to your
shareholders. While we still prefer a negotiated transaction, alternatively,
we would encourage you and Computer Sciences' Board of Directors to put our
unilateral offer to the CSC shareholders without delay." The full text of the
letter is also available at http://www.cai.com/csc. .
<PAGE>
In connection with a lawsuit CSC filed in California State Court on Feb.
23, Mr. Wang stated, "I am surprised that Van let his advisors drag CSC down
to this level of mudslinging. Each and every allegation in CSC's complaint is
blatantly false, and we will address those claims in court. The important
issue here is CA's all-cash offer for $108 per share, and the shareholders'
right to decide. We plan to stay focused on combining CSC and CA, and expect
CSC management to do the same."
Mr. Wang added, "CA has every right to make an offer to buy CSC. We
followed all the rules under the Federal Securities laws, and we resent CSC's
allegation that such an offer would expose us to liability."
"Over the last three years, the Standard & Poor's 500 has outperformed
CSC stock," Mr. Wang said. "We have offered more than a 30 percent cash
premium from CSC's share price at the time we started our discussions with
Van. Our offer and commitment should be valued on the merits. CSC's Board has
a fiduciary responsibility to allow the shareholders to vote on our proposal."
CA's offer expires March 16, 1998 unless extended. CA is being
represented by Bear, Stearns & Co. Inc., Howard Darby & Levin, and MacKenzie
Partners, Inc.
CSC has approximately 85 million shares outstanding on a fully diluted
basis, and approximately $700 million of indebtedness, giving the transaction
a total value of approximately $9.8 billion.
Credit Suisse First Boston arranged financing through Bank of America,
Chase Manhattan Bank and NationsBank for the CSC acquisition.
Computer Associates International, Inc. (NYSE: CA), with headquarters in
Islandia, N.Y., is the world leader in mission-critical business software.
The company develops, licenses and supports more than 500 integrated products
that include enterprise computing and information management, application
development, manufacturing and financial applications. CA has over 11,000
people in 160 offices in 43 countries and had revenue of $4.5 billion in
calendar year 1997. CA can be reached by visiting http://www.cai.com. on the
World Wide Web, emailing [email protected], or calling 1-516-342-5224.
* * * * * * * * *
Computer Associates and the Computer Associates Nominees are
participants in the solicitation of consents, proxies and agent
designations from Computer Sciences Corporation shareholders. The
Computer Associates nominees are Charles B. Wang, Sanjay Kumar, Russell
Artzt,
<PAGE>
Peter A. Schwartz, Steven M. Woghin, Charles P. McWade, Ira Zar, Michael
A. McElroy, David Kaplan, Robert Toth, Richard Chiarello, Lisa Savino,
Gary Quinn, Abraham Poznanski and Douglas Robinson. None of the Computer
Associates Nominees will receive any additional compensation for their
participation in this solicitation.
Computer Associates own, through a wholly owned subsidiary, 170,000
shares of common stock of Computer Sciences Corporation. None of the
Computer Associates Nominees owns any shares of Computer Sciences common
stock.
Computer Associates has also retained Bear, Stearns & Co. Inc. and its
affiliates ("Bear Stearns") to provide certain financial advisory
services o Computer Associates. Bear Stearns is acting as Dealer Manager
in connection with the Offer and as financial advisor to Computer
Associates and CAI Computer Services Corp., a wholly owned subsidiary of
Computer Associates, in connection with the proposed acquisition of the
Company, but Bear Stearns has not been retained to specifically assist
in this solicitation. Computer Associates is obligated to pay to Bear
Stearns, if, s more fully described in the engagement letter relating to
Bear Stearns' engagement, during the term of the engagement or within 12
months thereafter Computer Associates acquires the Company or more than
50% of its outstanding voting securities, a fee of $5 million and a fee
of $1 llion (which will be credited against such $5 million fee) if
Computer Associates requests Bear Stearns to render a customary fairness
opinion. Bear Stearns is also entitled to act as sole lead underwriter,
placement agreement and financial advisor in connection with certain
debt and equity financings (and certain refinancings) and certain asset
sales for a specified period following the acquisition and to receive
fees in connection therewith. In addition, Computer Associates has
agreed to reimburse Bear Stearns for its reasonable expenses, including
reasonable fees and disbursements of its counsel, incurred in rendering
its services under its engagement agreement with Computer Associates and
has agreed to indemnify Bear Stearns against certain liabilities and
expenses in connection with the Offer and the Proposed Merger, including
certain liabilities under the federal securities laws. Bear Stearns from
time to time renders various investment banking services to Computer
Associates and its affiliates for which it is paid customary fees.
In connection with Bear Stearns' engagement as financial advisor,
Computer Associates anticipates that Michael J. Urfirer, Senior Managing
Director of Bear Stearns, Lisa M. Price, Senior Managing Director of
Bear Stearns and Barry J. Cohen, Senior Managing Director of Bear
Stearns, none of whom will receive additional compensation for such
solicitation, may communicate in person, by telephone or otherwise
with a limited number of
<PAGE>
institutions, brokers or other persons who are shareholders for the
purpose of assisting in this solicitation. Bear Stearns will not receive
any fee for, or in connection with, such solicitation activities by its
employees apart from the fees it is otherwise entitled to receive as
described above. None of the above-named employees of Bear Stearns owns
any shares of Computer Sciences Corporation common stock.
