Form 8-K/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
July 31, 1995 (January 24, 1995)
C-TEC CORPORATION
(Exact name of registrant as specified in its charter)
Pennsylvania 0-11053 23-2093008
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
105 Carnegie Center, Princeton, NJ 08540-6215
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(609) 734-3700
(Former name or former address, if changed since last report).
Item 2. Acquisition or Disposition of Assets
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C-TEC International, Inc., a wholly owned subsidiary of C-TEC
Properties, Inc, which in turn is a wholly owned subsidiary of C-TEC
Corporation, (collectively "C-TEC") purchased on January 24, 1995 a 40
percent equity position in Megacable, Mexico's second largest cable
television operator, for approximately $84 million in cash, subject to
adjustments. Under the agreement C-TEC's investment in Megacable is in
exchange for newly-issued capital stock. The funds will be used by
Megacable to pay off existing debt, for capital expenditures, and to create
a substantial cash reserve for further Megacable acquisitions and
telecommunications ventures in Mexico. In addition, C-TEC representatives
will hold six new seats on Megacable's Board of Directors. C-TEC's
representatives will constitute six of fifteen members of the Board.
C-TEC will have an active role in setting the strategic direction of the
company. Such role includes assisting in:
(1) advising the senior management of the Megacable or the Board
of Directors, as the case may be, on key strategic decisions and
policies with respect to marketing, programming, technology and
finance;
(2) approving the Chief Executive Officer's selection of those members
of the Megacable's senior management who report directly to the Chief
Executive Officer;
(3) approving and overseeing the implementation of the annual
business plan, annual budget and significant capital expenditures;
(4) advising the Board of Directors with respect to the
business and financial prospects of Megacable; and
(5) devising and implementing appropriate accounting
procedures, internal controls and procedures designed to bring to the
attention of the Management Committee material events relating to the
business of Megacable and its Subsidiaries.
Megacable is privately held.
The investment amount in the transaction has taken into account the
impact of the peso devaluation over the past 60 days and its expected impact
on the telecommunications business in Mexico.
Megacable, with headquarters in Los Mochis, currently serves over
174,00 subscribers in twelve cities including Hermosillo, Navajoa, Diudad
Obregon, Culiacan, Mazatlan, and Pacific coast. In addition, Megacable owns
the Guadalajara franchise, Mexico's second largest city, which is only about
half cabled so far. Additionally, Megacable was recently awarded a new
franchise in Tepic and several smaller towns, adding 60,000 more potential
customers to its overall base of over 900,000 franchise homes.
The acquisition will be funded through C-TEC's working capital.
The required financial statements of Megacable and pro forma
financial information will be filed within sixty days after the required
filing date of this Form 8-K.
Item 7. Exhibits
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(c) Exhibits
10.1 Subscription Agreement among Megacable, S.A. DE CV and C-TEC
International, Inc. (previously filed)
99 Press release of C-TEC Corporation dated as of January 25,
1995 announcing the purchase of a forty percent equity
position in Megacable. (previously filed)
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 hereunto dully authorized.
C-TEC Corporation
By: /s/ Bruce Godfrey
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Name: Bruce Godfrey
Title: Executive Vice President
and Chief Financial Officer
Date: July 31, 1995
