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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): June 5, 1997
HARCOURT GENERAL, INC.
(Exact of name of registrant as specified in its charter)
DELAWARE 1-4925 04-1619609
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
27 BOYLSTON STREET
CHESTNUT HILL, MA 02167
(Address of Principal Executive Offices)(Zip Code)
Registrant's Telephone Number, Including Area Code: (617) 232-8200
Exhibit Index Appears on Page 3
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Item 2. Acquisition or Disposition of Assets.
On April 21, 1997, Harcourt General, Inc., a Delaware
corporation ("Harcourt"), through a wholly-owned subsidiary, Nick Acquisition
Corporation, a Delaware corporation ("Nick"), commenced a tender offer (the
"Offer") to acquire all of the outstanding shares (the "Shares") of Common Stock
of National Education Corporation, a Delaware corporation ("NEC"). The initial
per Share consideration offered was $19.50. On May 12, 1997, Harcourt and Nick
entered into an Agreement and Plan of Merger with NEC (the "Merger Agreement")
pursuant to which Harcourt agreed to increase the per Share consideration
of the Offer to $21.00, and agreed to lend $30 million to NEC to pay a $30
million fee to Sylvan Learning Systems, Inc. ("Sylvan") in connection with the
termination of a previously entered into merger agreement between NEC and
Sylvan. On June 4, 1997, the Offer terminated, and on June 5, 1997, Harcourt
acquired approximately 34.4 million Shares, representing approximately 95.6%
of the issued and outstanding Shares. Harcourt promptly paid approximately
$723.4 million for those Shares. On June 10, 1997, pursuant to the Merger
Agreement, Nick was merged with and into NEC, and the remaining approximately
1.6 million Shares not previously purchased in the offer were converted into
the right to receive $21.00 in cash.
Harcourt used available cash and equivalents and short-term
investments, as well as borrowings under its existing $400 million revolving
credit facility (the "Credit Agreement"), to fund payments of approximately $850
million (including estimated fees and expenses) in connection with the
transactions referenced in the immediately preceding paragraph. The Credit
Agreement is dated as of December 16, 1994 among Harcourt, Morgan Guaranty Trust
Company of New York, as documentation agent, The First National Bank of Boston,
as administrative agent, The Bank of Nova Scotia and National Westminster Bank
Plc, as co-agents, and a group of 13 lending parties thereto.
NEC is a global provider of print and interactive multimedia
based products and services for the education and training marketplace. NEC's
business is conducted primarily through three operating entities, ICS Learning
Systems, Inc. ("ICS"), Steck-Vaughn Publishing Corporation ("Steck-Vaughn"), and
National Education Training Group, Inc. ("NETG"). ICS provides distance learning
opportunities in vocational, degree and professional self-studies to consumers
and businesses. Steck-Vaughn publishes supplemental educational materials used
in elementary, secondary and adult education. NETG develops, markets and
distributes interactive multimedia products to train information technology
professionals and end-users of technology. Through NEC, Harcourt holds
approximately 82% of the issued and outstanding shares of common stock of
Steck-Vaughn, and the remaining shares of common stock of Steck-Vaughn are
traded on the NASDAQ National Market.
Prior to acquiring control of Steck-Vaughn, Harcourt entered
into an agreement with Steck-Vaughn pursuant to which Harcourt agreed that until
June 4, 2000, it would not consummate any business combination (as defined in
Section 203 of the Delaware General Corporation Law) with Steck-Vaughn unless
and until (i) the proposed business combination has been submitted by Harcourt
in writing to the Board of Directors of Steck-Vaughn, (ii) a committee of the
Board of Directors of Steck-Vaughn comprised solely of disinterested directors
affirmatively recommends its approval of such business combination, finding that
the
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terms thereof are fair to the shareholders of Steck-Vaughn other than NEC and
Harcourt and (iii) the business combination is approved by a majority of the
Steck-Vaughn Board of Directors, including a majority of the disinterested
directors.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of businesses acquired:
The Consolidated Financial Statements of National Education Corporation
and its subsidiaries for the fiscal year ended December 31, 1996,
together with the Notes thereto are incorporated herein by reference to
Form 10-K for the year ended December 31, 1996 of National Education
Corporation (Commission File No. 1-6981).
The Condensed Consolidated Financial Statements of National Education
Corporation and its subsidiaries for the period ended March 31, 1997,
together with the Notes thereto are incorporated herein by reference
to Form 10-Q for the quarter ended March 31, 1997, of National
Education Corporation (Commission File No. 1-6981).
(b) Pro Forma financial information:
To be filed by Amendment not later than August 20, 1997.
(c) Exhibits:
Exhibit 2.1 Agreement and Plan of Merger among Harcourt
General, Inc., Nick Acquisition Corporation and
National Education Corporation, dated as of May 12,
1997, incorporated herein by reference to Exhibit
11(c)(1) to Amendment No. 3 to Schedule 14D-1 of
Harcourt General, Inc., dated May 14, 1997.
Exhibit 2.2 Credit Agreement dated as of December 16, 1994 among
Harcourt General, Inc., the banks listed therein,
Morgan Guaranty Trust Company of New York, as
documentation agent, The First National Bank of
Boston, as administrative agent, The Bank of Nova
Scotia and National Westminster Bank Plc, as
co-agents, incorporated herein by reference to
Exhibit 11(b) to Schedule 14D-1 of Harcourt General,
Inc., dated April 21, 1997.
Exhibit 23.1 Consent of Price Waterhouse LLP.
Exhibit 99.1 Agreement dated May 30, 1997 between Harcourt
General, Inc. and Steck-Vaughn Publishing
Corporation, incorporated herein by reference to
Exhibit 11(a)(21) to Amendment No. 5 to Schedule
14D-1 of Harcourt General, Inc., dated June 5, 1997.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HARCOURT GENERAL, INC.
Date: June 18, 1997 By: /s/ Eric P. Geller
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Eric P. Geller
Senior Vice President,
General Counsel and
Secretary
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Exhibit 23.1
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of the Registration Statements on Form S-3 (Nos. 33-13936 and
33-46148) and the Registration Statement on Form S-8 (No. 33-26079) of Harcourt
General, Inc. of our report dated January 28, 1997, except as to Note 17, which
is as of March 12, 1997, relating to the consolidated financial statements of
National Education Corporation, which is incorporated by reference into the
Current Report on Form 8-K of Harcourt General, Inc. dated June 18, 1997.
/s/ Price Waterhouse LLP
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PRICE WATERHOUSE LLP
Costa Mesa, California
June 18, 1997
