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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
Date of Report (Date of Earliest Event Reported) : September 16, 1998
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OMNICARE, INC.
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 1-8269 31-1001351
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(State or other jurisdiction of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
100 East RiverCenter Blvd.
Covington, Kentucky 41011
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(Address of principal executive offices) (Zip Code)
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(606) 392-3300
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(Registrant's telephone number, including area code)
Not applicable
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(Former name or address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets.
Omnicare, Inc., a Delaware corporation (the "Registrant"), through several
wholly-owned subsidiaries, has acquired, effective as of September 16, 1998,
substantially all of the institutional pharmacy assets (the "Business") of
Extendicare Health Services, Inc., a Delaware corporation ("Extendicare"), and
certain subsidiaries of Extendicare (together with Extendicare, "Sellers"). The
acquisition was made pursuant to the Asset Purchase Agreement dated as of July
29, 1998 (the "Asset Purchase Agreement"). A copy of the Asset Purchase
Agreement is filed herewith as Exhibit 2.1 and is incorporated herein by
reference. A copy of the press release announcing the closing of the asset
acquisition is filed herewith as Exhibit 99.1 and is incorporated herein by
reference.
The purchase price consisted of $250 million in cash, 125,000 shares of
Registrant's common stock, par value $1.00 per share ("Common Stock") and
warrants to purchase up to 1.5 million shares of Common Stock at $48.00 per
share. The cash portion of the purchase price is subject to adjustment as set
forth in the Asset Purchase Agreement. The purchase price was determined by
arms-length negotiations among the parties. Registrant obtained the funds for
the purchase price through an existing $400 million credit facility the
Registrant maintains with a consortium of sixteen banks.
Registrant intends to continue to use the assets purchased from Sellers in
the operation of the Business. No material relationship exists between Sellers
and Registrant or any of Registrant's affiliates, directors or officers, or any
associate of any such directors or officers, although it is anticipated that the
Registrant will provide pharmacy services to the Sellers or their affiliates.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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(a),(b) The Registrant will file the required financial statements
within 75 days of September 16, 1998.
(c) Exhibits
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Exhibit No. Description
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2.1 Asset Purchase Agreement, dated as of July
29, 1998, among Omnicare, Inc., Badger
Acquisition Corp., Extendicare Health
Services, Inc., and certain subsidiaries of
Extendicare Health Services, Inc.
(incorporated herein by reference to
Registrant's Current Report on Form 8-K,
dated August 7, 1998)
99.1 Press Release dated September 17, 1998
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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 thereunto duly authorized.
OMNICARE, INC.
/s/ David W. Froesel, Jr.
By:--------------------------
Name: David W. Froesel, Jr.
Title: Senior Vice President and
Chief Financial Officer
Date: September 28, 1998
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EXHIBIT INDEX
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Description Exhibit No.
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2.1 Asset Purchase Agreement, dated as of
July 29, 1998, among Omnicare, Inc., Badger
Acquisition Corp., Extendicare Health Services,
Inc., and certain subsidiaries of Extendicare
Health Services, Inc.(incorporated herein by
reference to Registrant's Current Report on
Form 8-K, dated August 7, 1998)
99.1 Press Release dated September 17, 1998
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EXHIBIT 99.1
COVINGTON, Ky. -- Sept. 17, 1998--Omnicare, Inc. (NYSE:OCR) announced that it
has completed the previously announced acquisition of the institutional pharmacy
operations of Extendicare Health Services, Inc. ("EHSI"), a wholly owned
subsidiary of Extendicare Inc. (NYSE:EXEa; TSE/ME:EXE and EXE.A; NYSE:EXE.A) for
$250 million in cash, 125,000 shares of Omnicare common stock and 1.5 million
warrants to purchase Omnicare common stock at $48.00 per share. The warrants
have a seven-year term and are first exercisable in September 2001. Given the
economies of scale and cost synergies anticipated from the acquisition, it is
expected that the transaction will be non-dilutive to Omnicare's per share
earnings in 1998 and accretive in 1999 and beyond.
Based in Milwaukee, Wisconsin, the pharmacy business of EHSI, operating under
the name United Professional Companies, Inc. ("UPC"), has contracts to provide
comprehensive pharmacy, related consulting and infusion therapy services to
approximately 55,000 residents in more than 550 facilities in 12 states. This
transaction also offers Omnicare the opportunity to provide pharmacy services to
an additional 77 Extendicare facilities with capacity for 9,300 residents in
Canada and the United Kingdom. Based upon the six months ended June 30, 1998,
UPC's pharmacy revenues are running at the annualized rate of approximately $165
million.
Extendicare, based in Markham, Ontario, is one of the largest operators of
long-term care facilities in North America. On June 30, 1998, the Corporation
operated 317 facilities, with capacity for over 31,900 residents and had more
than 41,100 employees in the United States, Canada, and the United Kingdom.
Extendicare also provides medical specialty services, including subacute care
and rehabilitative therapy services and other medical supplies and services in
the United States as well as home care and rehabilitative therapy services in
Canada.
Omnicare is a leading geriatric pharmaceutical care company. Currently serving
approximately 554,000 residents in more than 6,870 long-term care facilities in
40 states, Omnicare is the nation's largest provider of professional pharmacy,
related consulting and data management services for long-term care, assisted
living and other institutional health care providers. Omnicare also provides
comprehensive clinical research services for the pharmaceutical and
biotechnology industries.
(Statements in this press release concerning Omnicare's future economic
performances, anticipated profitability, anticipated cost synergies, the impact
of the Extendicare transaction on earnings, and the potential for expansion,
together with other statements that are not historical facts, are
forward-looking statements that are estimates reflecting the best judgement of
Omnicare based on currently available information. Such forward-looking
statements involve known and unknown risks, uncertainties, contingencies and
other factors that could cause results, performance or achievements to differ
materially from those stated. Such risks, uncertainties, contingencies and other
factors, many of which are beyond the control of Omnicare, include overall
economic and business
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conditions, trends for the continued growth of the pharmacy businesses of
Omnicare, the realization of anticipated revenues, profitability and cost
synergies of the combined companies, the demand for Omnicare's products and
services, pricing and other competitive factors in the industry, new government
regulations and/or legislative initiatives, the successful integration of the
Extendicare transaction, and other risks and uncertainties described in
Omnicare's reports and filings with the Securities and Exchange Commission.
There can be no such assurance that such factors will not affect the accuracy of
such forward-looking statements, and Omnicare assumes no obligation to update
the information in this release.)
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Contact:
Omnicare, Inc.
Cheryl D. Hodges, 606/392-3331
