<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 23, 2000
DEXTER CORPORATION
(Exact name of registrant as specified in its charter)
CONNECTICUT 1-5542 06-0321410
(State or other jurisdiction of (Commission file number) (I.R.S. Employer
incorporation or organization) Identification No.)
ONE ELM STREET, WINDSOR LOCKS, CONNECTICUT 06096
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (860) 292-7675
N/A
(Former name, former address and former fiscal year, if changed since last
report.)
<PAGE> 2
ITEM 2 - ACQUISITION OR DISPOSITION OF ASSETS
On June 20, 2000, Dexter Corporation (the "Company") announced that the
Company entered into a definitive agreement with Loctite Corporation (a
member of the Henkel Group) ("Loctite"), pursuant to which Loctite agreed to
buy the Company's Electronic Materials, Adhesives and Polymer Systems
businesses. The transaction was completed on August 23, 2000.
In accordance with the agreement, Loctite paid the Company $400 million in
cash. The agreement provides that the purchase price is subject to an
adjustment for any increase or decrease in the amount of net assets acquired
on the closing date.
On June 20, 2000, the Company announced that the Company entered into a
definitive agreement with Ahlstrom Paper Group Oy ("Ahlstrom"), pursuant to
which Ahlstrom agreed to buy the Company's Nonwoven Materials business. The
transaction was completed on August 31, 2000.
In accordance with the agreement, Ahlstrom paid the Company $275 million in
cash. The agreement provides that the purchase price is subject to an
adjustment for any increase or decrease in the amount of net assets acquired
on the closing date.
Electronic Materials, Adhesives and Polymer Systems, and Nonwoven Materials
together herein will be referred to as the "Businesses."
Closing of the sale to Loctite and closing of the sale to Ahlstrom were
conditions to consummation of the previously announced merger of Dexter
Corporation and Invitrogen Corporation (Nasdaq:IVGN) and the previously
announced merger of Dexter's 75% owned subsidiary, Life Technologies, Inc.
(OTC BB:LTEK), with Invitrogen. The two mergers with Invitrogen are subject
to, among other things, the approval of the Invitrogen mergers by the
Invitrogen, Dexter and Life Technologies stockholders at meetings to be held
on September 14, 2000.
2
<PAGE> 3
ITEM 7 - FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired
Not applicable
(b) Pro Forma Financial Information
The following unaudited pro forma condensed consolidated financial
statements are filed with this report:
Pro Forma Condensed Consolidated Statement of Financial Position at June 30,
2000
Pro Forma Condensed Consolidated Statement of Income for the year ended
December 31, 1999 and for the six months ended June 30, 2000
The unaudited Pro Forma Condensed Consolidated Statement of Financial
Position of the Registrant at June 30, 2000 reflects the financial position
of the Registrant as if the dispositions of the assets discussed in Item 2
took place on June 30, 2000. The unaudited Pro Forma Condensed Consolidated
Statement of Income for the fiscal year ended December 31, 1999 and for the
six months ended June 30, 2000 assumes that the dispositions occurred on
January 1, 1999. In addition, the unaudited Pro Forma Condensed Consolidated
Statement of Income for the fiscal year ended December 31, 1999 has been
adjusted to exclude the results of the Packaging Coatings business and the
printed wiring board product line. The Packaging Coatings business was
divested on February 26, 1999 and the printed wiring board product line was
divested on November 19, 1999.
These unaudited pro forma condensed consolidated financial statements are
based on available information and certain assumptions that the Registrant
believes are reasonable. The pro forma adjustments are based on preliminary
information and are subject to adjustments for actual information related to
the sale of the Businesses. These pro forma financial statements are
presented for illustrative purposes only. They do not purport to be
indicative of the results of operations which actually would have resulted
had the divestitures occurred on the dates indicated or which may result in
the future. The Registrant believes it has utilized reasonable methods to
conform the basis of presentation.
(c) Exhibits
No. Description
-- -----------
2.1 Asset Purchase Agreement, between Dexter Corporation and Loctite
Corporation, dated as of June 20, 2000, was filed as exhibit 2.1 to Form
8 - K (File No. 1 - 5542), which was filed with the Securities and
Exchange Commission on June 22, 2000, and is hereby incorporated herein
by reference.
2.2 Asset Purchase Agreement, between Dexter Corporation and Ahlstrom Paper
Group Oy, dated as of June 20, 2000, was filed as exhibit 2.1 to
Form 8 - K (File No. 1 - 5542), which was filed with the Securities and
Exchange Commission on June 22, 2000, and is hereby incorporated herein
by reference.
3
<PAGE> 4
SIGNATURES
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 thereunto duly authorized.
DEXTER CORPORATION
(Registrant)
Date: September 7, 2000 /s/ Kathleen Burdett
----------------- ------------------------------
Kathleen Burdett
Vice President and
Chief Financial Officer
(Principal Financial Officer)
Date: September 7, 2000 /s/ Dale J. Ribaudo
----------------- ------------------------------
Dale J. Ribaudo
Vice President and Controller
(Principal Accounting Officer)
4
<PAGE> 5
INDEX TO FINANCIAL STATEMENTS AND EXHIBITS
<TABLE>
<CAPTION>
Financial Statements Page
-------------------- ----
<S> <C>
Pro Forma Condensed Consolidated Statement of Financial
Position at June 30, 2000 (unaudited) 6
Pro Forma Condensed Consolidated Statement of Income
For the Year Ended December 31, 1999 (unaudited) 7
Pro Forma Condensed Consolidated Statement of Income
For the Six Months Ended June 30, 2000 (unaudited) 8
</TABLE>
5
<PAGE> 6
PRO FORMA FINANCIAL INFORMATION
DEXTER CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
JUNE 30, 2000
(000)
(UNAUDITED)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
Pro Forma Adjustments
In thousands of dollars Historical ----------------------------- PRO FORMA
(except per share amounts) 6/30/00 Businesses (a) Other 6/30/00
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Cash and short-term securities $113,418 $11,423 $364,000 (b) $465,995
Accounts receivable, net 191,396 90,618 100,778
Inventories 168,536 79,160 89,376
Prepaid and deferred expenses 40,334 9,820 30,514
---------- -------- -------- ----------
Total current assets 513,684 191,021 364,000 686,663
Property, plant and equipment, at cost, net 325,063 179,974 145,089
Excess of cost over net assets of businesses acquired 134,147 20,200 113,947
Patents, technology, trademarks, and covenants 122,853 21,706 101,147
Other assets 57,243 8,814 48,429
---------- -------- -------- ----------
$1,152,990 $421,715 $364,000 $1,095,275
========== ======== ======== ==========
LIABILITIES & SHAREHOLDERS' EQUITY
Short-term debt $14,026 $(10,188)(c) $3,838
Accounts payable 68,165 $42,141 26,024
Dividends payable 5,956 5,956
Accrued liabilities and taxes 110,867 40,694 141,000 (d) 211,173
Current installments of long-term debt 20,573 (20,230)(c) 343
---------- -------- -------- ----------
Total current liabilities 219,587 82,835 110,582 247,334
Long-term debt 271,282 (268,426)(c) 2,856
Deferred items 39,009 (1,219) 40,228
Long-term deferred income taxes 51,864 5,460 (29,000)(e) 17,404
Long-term environmental reserves 11,183 11,183
Minority interests 86,068 86,068
Shareholders' equity
Common stock and paid-in capital 40,502 40,502
Retained earnings 519,745 353,553 550,844 717,036
Treasury stock (55,812) (55,812)
Accumulated other comprehensive loss (30,438) (18,914) (11,524)
---------- -------- -------- ----------
Total shareholders' equity 473,997 334,639 550,844 690,202
---------- -------- -------- ----------
$1,152,990 $421,715 $364,000 $1,095,275
========== ======== ======== ==========
Equity per Share $20.69 $30.13
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) To eliminate the assets and liabilities of the Businesses divested which
were included in the Condensed Statement of Financial Position at June
30, 2000.
(b) Remaining cash proceeds after payment of debt.
(c) To reflect the proceeds from the sale of the Businesses applied to
short-term debt, current installments of long-term debt, and long-term
debt.
(d) To adjust accrued taxes as a result of the sale of the Businesses.
(e) Adjustment to deferred taxes as a result of the sale of the Businesses.
6
<PAGE> 7
PRO FORMA FINANCIAL INFORMATION
DEXTER CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1999
(000)
(UNAUDITED)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
Pro Forma Adjustments
In thousands of dollars HISTORICAL --------------------------- PRO FORMA
(except per share amounts) 12/31/99 Businesses (a) Other 12/31/99
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES
Net sales $1,041,673 $587,360 $454,313
Other income 8,483 795 $23,303 (b) 30,991
---------- -------- ------- -------
1,050,156 588,155 23,303 485,304
EXPENSES
Cost of sales 635,824 414,103 221,721
Marketing and administrative 251,244 82,781 168,463
Research and development 49,711 23,058 26,653
Interest 20,910 (5,817)(c) 15,093
Provision for contract settlement 3,870 3,870
Charge for restructuring businesses 2,430 2,430 0
Gain on divestiture of product lines (95,011) (95,011) 0
---------- -------- ------- -------
Income before Taxes 181,178 160,794 29,120 49,504
Income taxes 61,605 56,450 9,901 (d) 15,056
---------- -------- ------- -------
Income before Minority Interests 119,573 104,344 19,219 34,448
Minority interests 12,074 66 12,008
---------- -------- ------- -------
NET INCOME $107,499 $104,278 $19,219 $22,440
========== ======== ======= =======
NET INCOME PER SHARE - BASIC $4.71 (e) $0.98
NET INCOME PER SHARE - DILUTED $4.67 (e) $0.97
DIVIDENDS DECLARED PER SHARE $1.04 $1.04
AVERAGE SHARES OUTSTANDING (000) - BASIC 22,842 22,842
AVERAGE SHARES OUTSTANDING (000) - DILUTED 23,002 23,002
------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) To eliminate the pro forma results of the Businesses for the year
ended December 31, 1999 including the estimated income tax effect.
In addition, this schedule has been adjusted to exclude the results
of the Packaging Coatings business and the printed wiring board product
line for the period of their ownership in 1999.
(b) To reflect additional investment income from investing the net proceeds
after debt repayment from the sale of the Businesses.
(c) To reflect reduced interest expense resulting from the reduction in
short-term and long-term debt partially offset by a prepayment penalty
for early repayment of debt.
(d) Adjustment to reflect the income tax effect of pro forma adjustments.
(e) Includes a gain of $2.62 per share related to the sale of the Packaging
Coatings business and the printed wiring board product line in 1999.
7
<PAGE> 8
PRO FORMA FINANCIAL INFORMATION
DEXTER CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 2000
(000)
(UNAUDITED)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
Pro Forma Adjustments
In thousands of dollars HISTORICAL --------------------------- PRO FORMA
(except per share amounts) 6/30/00 Businesses (a) Other 6/30/00
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES
Net sales $530,007 $285,538 $244,469
Other income 5,570 620 $8,768 (b) 13,718
------- ------- ------- -------
535,577 286,158 8,768 258,187
EXPENSES
Cost of sales 320,705 201,395 119,310
Marketing and administrative 125,894 37,076 88,818
Research and development 25,021 10,295 14,726
Interest 11,252 (11,177)(c) 75
Gain on divestiture of product lines (7,002) (7,002) 0
Unsolicited merger proposal and
proxy contest costs 5,112 5,112
------- ------- ------- -------
INCOME BEFORE TAXES 54,595 44,394 19,945 30,146
Income taxes 18,562 15,094 6,781 (d) 10,249
------- ------- ------- -------
INCOME BEFORE MINORITY INTERESTS 36,033 29,300 13,164 19,897
Minority interests 6,206 (142) 6,348
------- ------- ------- -------
NET INCOME $29,827 $29,442 $13,164 $13,549
======= ======= ======= =======
NET INCOME PER SHARE - BASIC $1.30 $0.59
NET INCOME PER SHARE - DILUTED $1.29 $0.58
DIVIDENDS DECLARED PER SHARE $0.52 $0.52
AVERAGE SHARES OUTSTANDING (000) - BASIC 22,858 22,858
AVERAGE SHARES OUTSTANDING (000) - DILUTED 23,095 23,095
---------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) To eliminate the pro forma results of the Businesses for the six months
ended June 30, 2000, including the estimated income tax effect. In
addition, this schedule has been adjusted to exclude the results of the
Packaging Coatings business and the printed wiring board product line.
(b) To reflect additional investment income from investing the net proceeds
after debt repayment from the sale of the Businesses.
(c) To reflect reduced interest expense resulting from the reduction in
short-term and long-term debt.
(d) Adjustment to reflect the income tax effect of pro forma adjustments.
8
