SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
Schedule 14D-1
Tender Offer Statement
(Amendment No. 44)
Pursuant to
Section 14(d)(1) of the Securities Exchange Act of 1934
_______________________
ITT CORPORATION
(Name of Subject Company)
HILTON HOTELS CORPORATION
HLT CORPORATION
(Bidders)
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
450912100
(CUSIP Number of Class of Securities)
MATTHEW J. HART
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
HILTON HOTELS CORPORATION
9336 CIVIC CENTER DRIVE
BEVERLY HILLS, CALIFORNIA 90210
(310) 278-4321
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications on Behalf of Bidders)
WITH A COPY TO:
STEVEN A. ROSENBLUM
WACHTELL, LIPTON, ROSEN & KATZ
51 WEST 52ND STREET
NEW YORK, NEW YORK 10019
TELEPHONE: (212) 403-1000<PAGE>
This Statement amends and supplements the Tender Of-
fer Statement on Schedule 14D-1 filed with the Securities and
Exchange Commission on January 31, 1997, as previously amended
(the "Schedule 14D-1"), relating to the offer by HLT Corpora-
tion, a Delaware corporation (the "Purchaser") and a wholly
owned subsidiary of Hilton Hotels Corporation, a Delaware cor-
poration ("Parent"), to purchase (i) 65,000,000 shares of Com-
mon Stock, no par value (the "Common Stock") of ITT Corpora-
tion, a Nevada corporation (the "Company"), and (ii) unless and
until validly redeemed by the Board of Directors of the Com-
pany, the Series A Participating Cumulative Preferred Stock
Purchase Rights (the "Rights") associated therewith, upon the
terms and subject to the conditions set forth in the Offer to
Purchase, dated January 31, 1997 (the "Offer to Purchase"), and
in the related Letter of Transmittal, at a purchase price of
$80 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 as-
signed such terms in the Offer to Purchase and the Schedule
14D-1.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(47) Definitive Additional Proxy Material.<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and be-
lief, I certify that the information set forth in this state-
ment is true, complete and correct.
Dated: November 12, 1997
HILTON HOTELS CORPORATION
By: /s/ Matthew J. Hart
Name: Matthew J. Hart
Title: Executive Vice President
and Chief Financial Officer
-2-<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and be-
lief, I certify that the information set forth in this state-
ment is true, complete and correct.
Dated: November 12, 1997
HLT CORPORATION
By: /s/ Arthur M. Goldberg
Name: Arthur M. Goldberg
Title: President
-3-<PAGE>
EXHIBIT INDEX
Exhibit Description
(a)(47) Definitive Additional Proxy Material.<PAGE>
EXHIBIT (A)(47)
TO ALL ITT CORPORATION SHAREHOLDERS:
DO THE MATH ON
STARWOOD'S PAPER OFFER
<TABLE>
<CAPTION>
EPS VALUATION
<S> <C>
Starwood/ITT Pro Forma 1998 EPS $ 1.43 (1)
Premium Lodging Price to Earnings Ratio x 22.50 (2)
----------
Pro Forma Price Per Starwood Share $ 32.27
Maximum Shares Issued Per ITT Share x 1.117 (3)
----------
Pro Forma Stock Value Received $ 36.05
Cash Received 25.50
----------
TOTAL VALUE OF STARWOOD OFFER $ 61.55
==========
HILTON'S OFFER $80.00 GUARANTEED(4)
=================
</TABLE>
PLEASE VOTE THE
WHITE PROXY CARD TODAY
IMPORTANT
TIME IS SHORT -- DO NOT DELAY.
TO VOTE BY PHONE, CALL FOR SIMPLE INSTRUCTIONS NOW.
[MACKENZIE PARTNERS, INC. LOGO]
156 Fifth Avenue, New York, New York 10010
(212) 929-5500 (call collect)
or
CALL TOLL-FREE (800) 322-2885
FAX (212) 929-0308
Vote the WHITE proxy card today by TOLL-FREE TELEPHONE call. We also
urge you to FAX your WHITE proxy. If you have any questions or need
assistance in completing the WHITE proxy card, please contact MacKenzie
Partners, Inc. at the numbers above.
[HILTON HOTELS CORPORATION LOGO]
[FN]
(1) Based on analysis in Amendment No. 42 to Hilton's Schedule 14D-1,
filed on November 10, 1997.
(2) Based on Marriott International 1998 EPS multiple.
(3) Assumes issuance of maximum shares pursuant to Starwood collar.
(4) $80 in cash for 65 million ITT shares, plus Hilton stock and CVPs
that guarantee $80 per share within one year for the remaining ITT
shares (so long as Hilton stock price is at least $28 per share).
/FN
<PAGE>
TO ALL ITT CORPORATION SHAREHOLDERS:
EPS VALUATION OR EBITDA VALUATION
EITHER WAY YOU LOSE WITH STARWOOD
<TABLE>
<CAPTION>
EBITDA VALUATION
<S> <C>
Starwood/ITT Pro Forma 1998 EBITDA $ 1,760MM(1)
Premium Lodging EBITDA Multiple x 9.6 (2)
---------
Total Enterprise Value $16,896MM
Less Debt (9,563MM)(3)
---------
Pro Forma Price Per Starwood Share $ 35.94
Maximum Shares Issued Per ITT Share x 1.117(4)
----------
Pro Forma Stock Value Received $ 40.15
Cash Received 25.50
----------
TOTAL VALUE OF STARWOOD OFFER $ 65.65
==========
HILTON'S OFFER $80.00 GUARANTEED(5)
====================
</TABLE>
PLEASE VOTE THE
WHITE PROXY CARD TODAY
IMPORTANT
TIME IS SHORT -- DO NOT DELAY.
TO VOTE BY PHONE, CALL FOR SIMPLE INSTRUCTIONS NOW.
[MACKENZIE PARTNERS, INC. LOGO]
156 Fifth Avenue, New York, New York 10010
(212) 929-5500 (call collect)
or
CALL TOLL-FREE (800) 322-2885
FAX (212) 929-0308
Vote the WHITE proxy card today by TOLL-FREE TELEPHONE call. We also
urge you to FAX your WHITE proxy. If you have any questions or need
assistance in completing the WHITE proxy card, please contact MacKenzie
Partners, Inc. at the numbers above.
[HILTON HOTELS CORPORATION LOGO]
[FN]
(1) Based on analysis in Amendment No. 42 to Hilton's Schedule 14D-1,
filed on November 10, 1997.
(2) Based on Marriott International 1998 EBITDA multiple.
(3) Per Starwood proxy, adjusted for increase in cash portion of
Starwood offer.
(4) Assumes issuance of maximum shares pursuant to Starwood collar.
(5) $80 in cash for 65 million ITT shares, plus Hilton stock and CVPs
that guarantee $80 per share within one year for the remaining ITT
shares (so long as Hilton stock price is at least $28 per share).
/FN
<PAGE>
To All ITT Corporation Shareholders:
TODAY IS YOUR LAST OPPORTUNITY
TO CREATE THE WORLD'S PREMIER
GAMING AND LODGING COMPANY
VOTE FOR HILTON'S GUARANTEED(1)
AND SUPERIOR $80 OFFER
-More Cash
-More Value
-More Certainty
-Less Risk
THE AUCTION ENDS TODAY!
IT'S NOT TOO LATE TO VOTE!
PLEASE VOTE THE
WHITE PROXY CARD TODAY
IMPORTANT
TIME IS SHORT -- DO NOT DELAY.
TO VOTE BY PHONE, CALL FOR SIMPLE INSTRUCTIONS NOW.
[MACKENZIE 156 Fifth Avenue, New York, New York 10010
PARTNERS, INC. (212) 929-5500 (call collect)
LOGO] or
CALL TOLL-FREE (800) 322-2885
FAX (212) 929-0308
Vote the WHITE proxy card today by TOLL-FREE TELEPHONE call. We also
urge you to FAX your WHITE proxy. If you have any questions or need
assistance in completing the WHITE proxy card, please contact MacKenzie
Partners, Inc. at the numbers above.
[HILTON HOTELS CORPORATION LOGO]
[FN]
(1)$80 in cash for 65 million ITT shares, plus Hilton stock and CVPs
that guarantee $80 per share within one year for the remaining ITT
shares (so long as Hilton stock price is at least $28 per share).
/FN
<PAGE>
[HILTON HOTELS CORPORATION LOGO]
Contacts: Marc A. Grossman
Sr. Vice President Corporate Affairs
In New York 11/11
212-371-5999
Kathy Shepard
Corporate Communications
In New York 11/11
212-371-5999
Joele Frank
Abernathy MacGregor Group Inc.
212-371-5999
FOR IMMEDIATE RELEASE
HILTON SENDS LETTER TO "SPECIAL COMMITTEE" OF ITT DIRECTORS
Beverly Hills, Calif. (November 11, 1997) -- Hilton Hotels
Corporation's [NYSE: HLT] president and chief executive
officer, Stephen F. Bollenbach, today sent the following letter
to the members of the "Special Committee" of the board of
directors of ITT Corporation [NYSE: ITT]:
November 11, 1997
"Special Committee" of the Board of Directors
ITT Corporation
1330 Avenue of the Americas
New York, NY
Dear Members of the "Special Committee":
This morning, ITT ran a full page advertisement claiming,
among other inaccuracies, that the current Starwood proposal
for ITT is higher than Hilton's $80 offer. To my knowledge,
neither the ITT "Special Committee" nor the full Board has made
any determination as to the relative values of the Hilton offer
and the Starwood proposal. If I am correct, I would appreciate
your informing me immediately why ITT is spending the money of
its shareholders to run an ad that, in effect, prejudges that
determination.
WORLD HEADQUARTERS
9336 Civic Center Drive, Beverly Hills, California 90210
Telephone 310-278-4321
Reservations 1-800-HILTONS<PAGE>
"Special Committee" of the Board of Directors
ITT Corporation
November 11, 1997
Page Two
Hilton has presented an analysis in this morning's news-
papers demonstrating that, on either an earnings per share or
an EBITDA valuation, the value of the Starwood proposal is
about $61.55 to $65.65 per ITT share. This is obviously well
below Hilton's guaranteed $80 offer.
In response to Hilton's devastating analysis, Starwood is
trying to convince ITT shareholders that the combined ITT-
Starwood would be valued based on a relatively obscure measure-
ment called "FFO" (funds from operations), rather than earnings
per share or EBITDA. But ITT is not valued based on "FFO."
Nor is any other company in our industry. And even Starwood's
own accountants admit that the Starwood proposal amounts to an
ITT acquisition of Starwood. Over two-thirds of the combined
company's assets would be ITT assets. The notion that ITT
would suddenly became valued on the basis of "FFO", simply
because it acquires the much smaller Starwood, is absurd.
ITT's advertisement this morning also demonstrates clearly
how the so-called "auction" you claim to be running is biased
and rigged, and why Hilton will not participate in such a
process.
Sincerely,
/s/ Stephen F. Bollenbach
Stephen F. Bollenbach
SFB:md<PAGE>
[HILTON HOTELS CORPORATION LOGO]
Contacts: Marc A. Grossman Geoff Davis
Sr. Vice President Investor Relations
Corporate Affairs In New York 11/11
In New York 11/11 212-371-5999
212-371-5999
Kathy Shepard Joele Frank
Corporate Communications Abernathy MacGregor Group Inc.
In New York 11/11 212-371-5999
212-371-5999
FOR IMMEDIATE RELEASE
HILTON CHANGES MAKE BACK-END STOCK TAX-FREE
Beverly Hills, Calif, (November 11, 1997) -- Hilton Hotels
Corporation [NYSE: HLT] said today that the changes announced
November 10 make the common stock portion of its $80 back-end
merger consideration tax-free to ITT shareholders, and that the
contingent value shares that protect the value of the Hilton
shares may also receive tax-free treatment. The changes in the
back-end merger may result in a greater cash percentage being paid
to tendering shareholders on the front end.
Stephen F. Bollenbach, Hilton's president and chief executive
officer stated, "We made the adjustments to our back-end merger to
give ITT shareholders a significant tax-free alternative. Major
shareholders want to continue to invest in the combined Hilton/ITT
with its strong growth potential and enhanced gaming and lodging
prospects."
Hilton added that, since announcement of the tax-free merger
structure, certain ITT shareholders have indicated to Hilton their
intention to forego tendering some or all of their shares in order
to minimize the tax impact and to participate more fully in a
combined Hilton/ITT as a common stockholder. By not tendering,
shareholders also move the transaction totally into 1998 for tax
purposes. Hilton also confirmed that the 315,100 shares of ITT it
owns will not, of course, be tendered into the offer, and will be
cancelled in the merger.
- more -
WORLD HEADQUARTERS
9336 Civic Center Drive, Beverly Hills, California 90210
Telephone 310-278-4321
Reservations 1-800-HILTONS<PAGE>
- 2 -
The following table illustrates the impact of various levels
of ITT shareholders not tendering their ITT shares:
HILTON $80 OFFER
------------------------------------------------------------------
PERCENTAGE OF ITT SHAREHOLDERS AMOUNT OF CASH PER ITT SHARE
ELECTING TO EXCHANGE ALL THEIR AVAILABLE FOR ITT SHAREHOLDERS
SHARES IN THE MERGER ELECTING CASH
------------------------------------------------------------------
45% or more $80.00
------------------------------------------------------------------
40% $74.16
------------------------------------------------------------------
35% $68.45
------------------------------------------------------------------
30% $63.56
------------------------------------------------------------------
25% $59.33
------------------------------------------------------------------
20% $55.62
------------------------------------------------------------------
15% $52.35
------------------------------------------------------------------
10% $49.44
------------------------------------------------------------------
5% $46.84
------------------------------------------------------------------
0% $44.49
------------------------------------------------------------------
In other words, if owners of 20% of ITT's shares do not
tender for tax or other reasons, the minimum percentage of
tendering shares purchased increases from 55.62%, if all
shareholders tender, to 69.52%. In this case, tendering
shareholders would, in the aggregate, receive $55.62 in cash plus
.61 shares of Hilton plus .61 contingent value preferred shares
for each of their ITT shares.
###<PAGE>
[HILTON HOTELS CORPORATION LOGO]
Contacts:
Marc A. Grossman Jeanne M. Carr Grace M. Protos
Hilton Hotels Corporation MacKenzie MacKenzie
Sr. Vice President Partners, Inc. Partners, Inc.
Corporate Affairs 212-929-5916 212-929-5802
310-205-4030
FOR IMMEDIATE RELEASE:
HILTON ENCOURAGES ALL ITT SHAREHOLDERS TO TAKE ADVANTAGE
OF LAST-MINUTE VOTING PROCEDURES
Beverly Hills, CA (November 11, 1997) - Hilton Hotels Corporation
(NYSE: HLT) encourages ALL ITT Corporation (NYSE: ITT) sharehold-
ers to vote their proxies in time for ITT's long delayed annual
meeting scheduled for 11:30 a.m. EST tomorrow, November 12, 1997.
As time is short, Hilton suggests that ITT shareholders take
advantage of the last minute voting procedures set up by Hilton.
Many ITT shareholders have been sent a special mailgram providing
instructions for voting via telephone using a secure Personal
Identification Number. Telephone operators are available from
8:00 a.m. to 12:00 midnight EST to assist shareholders with voting
their shares.
Shareholders who own ITT stock through a bank or brokerage firm
can also call their representative and instruct them to vote
Hilton's WHITE proxy card.
ITT shareholders who own ITT stock in their own name, should fax
both sides of the WHITE proxy card to Hilton's proxy solicitor,
MacKenzie Partners, Inc. at (212) 929-0308.
ITT shareholders who hold shares through a bank or brokerage firm
who wish to vote at the shareholder meeting must contact their
custodian and request a "legal proxy" as promptly as possible.
Institutional shareholders are reminded that ADP Proxy Services
can not provide electronic voting (i.e. Proxy Edge) in contested
situations. Institutional shareholders should either call their
custodian or their ADP representative with instructions to vote
Hilton's WHITE proxy card, or fax their vote to ADP at (516) 254-
7622.
All questions or requests for assistance in voting ITT's shares,
should be directed to MacKenzie Partners, Inc. toll-free at (800)
322-2885 or at (212) 929-5500 (call collect).
###
WORLD HEADQUARTERS
9336 Civic Center Drive, Beverly Hills, California 90210
Telephone 310-278-4321
Reservations 1-800-HILTONS<PAGE>
ADDITIONAL INFORMATION REGARDING
ITT/STARWOOD VALUATION
In response to inquiries by ITT shareholders, Hilton has
compiled the attached supplemental information relevant to a
valuation of a combined ITT/Starwood entity. The attached data
shows, among other things, that:
The current trading price of Hilton common stock rep-
resents an 18.8 multiple of 1998 Hilton/ITT earnings
per share, a 9.5 multiple of 1998 Hilton/ITT EBITDA
and only a 7.6 multiple of 1998 Hilton/ITT FFO. In
contrast, in order to support Starwood's current
stock price, a combined ITT/Starwood would need to
trade at an 11.8 multiple of FFO, an 11.9 multiple of
EBITDA and a 38.5 EPS multiple.
If ITT/Starwood executed its contemplated sales of
ITT's World Directories, gaming and educational ser-
vices businesses, it will have effectively paid 16.5
times EBITDA for the remaining businesses (based on
Starwood's current stock price).
Furthermore if ITT/Starwood executes its contemplated
sale of ITT's World Directories, gaming and
educational services businesses, its 1998 EPS and
1998 FFO would be reduced by approximately $0.43 per
share and $1.18 per share, respectively.
Even if ITT/Starwood were valued based on FFO --
despite the fact that the majority of its operations
are not real estate operations -- and even if
Starwood's current FFO multiple of 11.8 were used,
after the sale of the World Directories, gaming and
educational services businesses the ITT/Starwood
stock price would be approximately $41.38.<PAGE>
<TABLE>
<CAPTION>
1988 MULTIPLE ANALYSIS
==============================================================
<S> <C> <C>
HLT/ITT HOT/Westin/ITT
----------- --------------
Stock Price $31.00 $55.25
1998 EPS $1.65(1) $1.43(2)
Multiple 18.8x 38.5x
1998 FFO $4.08 $4.69
Multiple 7.6x 11.8x
Enterprise Value $24,042 $20,861
EBITDA $2,533 $1,760
Multiple 9.5x 11.9x
==============================================================
</TABLE>
<TABLE>
<CAPTION>
1998 FFO
--------------------------------------------------------------
<S> <C> <C>
HLT/ITT HOT/Westin/ITT(2)
----------- -----------------
Net Income 617(1) 293
Minority Int 25 28
D/A 744 573(3)
Goodwill 140 64
------------- ---------- ----------
FFO 1,526 958
Shares 374 204
per share $4.08 $4.69
TEV/1998 EBITDA
--------------------------------------------------------------
HLT/ITT HOT/Westin/ITT
----------- --------------
Market Equity Value 11,596 11,298
Debt 12,282 9,564
PRIDES 165 0
--------------- ---------- ----------
TEV 24,042 20,861
EBITDA
ITT(4) 1,237 1,237
Acquiror(4) 1,229 448
Mgmt Conflict (18) 0
Synergies(5) 86 75
---------------- ---------- ----------
Total EBITDA 2,533 1,760
--------------------------------------------------------------
<FN>
(1) Based on IBES estimates.
(2) Based on analysis included in Amendment No. 42 to Hilton's
Schedule 14D1, filed on November 10, 1997.
(3) ITT D&A from Morgan Stanley plus 90% of HOT/Westin D&A
(10% assumed goodwill amort) from CS First Boston.
(4) HLT estimated by Bear Stearns, ITT estimated by Morgan
Stanley, HOT/Westin estimated by CS First Boston.
(5) 75% of expected synergies of $115MM for HLT/ITT and $100MM
for HOT/Westin/ITT.
</FN>
/TABLE
<PAGE>
<TABLE>
<CAPTION>
MULTIPLE ANALYSIS ASSUMING ASSET SALES
=========================================================================================
<S> <C> <C> <C> <C>
Sell WD Sell Gaming Sell ESI Sell All Three
======= =========== ======== ==============
Gross Proceeds(1) $1,900 $3,280 $523 $5,703
Net Proceeds(2) 1,340 3,168 345 4,853
1998 EBITDA Loss (3) 211 410 42 663
EBITDA Sale Multiple (Pre-Tax) 9.0x 8.0x 12.5x 8.6x
After Tax EPS Adjustments
1998 EBITDA Loss (127) (246) (25) (398)
Interest Expense Savings(4) 60 143 16 218
Depreciation(5) 11 71 10 92
-------- -------- -------- --------
Total Adjustments (56) (32) (0) (88)
=========================================================================================
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
EPS Pre-Sale $1.43 $1.43 $1.43 $1.43
EPS Post-Sale $1.16 $1.28 $1.43 $1.01
Accretion/Dilution($) ($0.27) ($0.16) ($0.00) ($0.43)
Stock Price @22.5x(6) $26.17 $28.73 $32.26 $22.62
FFO Pre-Sale $4.69 $4.69 $4.69 $4.69
FFO Post Sale $4.33 $3.95 $4.61 $3.51
Accretion/Dilution($) ($0.36) ($0.74) ($0.08) ($1.18)
Stock Price @11.8x(6) $51.01 $46.54 $54.32 $41.38
=========================================================================================
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
IMPLIED PURCHASE MULTIPLES(7)
Pre-Sale
Enterprise Value 14,310 14,310 14,310 14,310
1998 EBITDA 1,237 1,237 1,237 1,237
Purchase Multiple 11.6x 11.6x 11.6x 11.6x
Post-Sale =========
Enterprise Value 12,970 11,142 13,966 9,458
1998 EBITDA 1,026 827 1,195 547
Implied Purchase Multiple 12.6X 13.5x 11.7x 16.5x
_____________________________ =========
<FN>
(1) Gross proceeds estimated based on (i) an 8.0x multiple for gaming assets applied
against 1998 estimated gaming EBITDA, (ii) a 9.0x multiple for the World Directories busi-
ness applied against 1998 estimated World Directories EBITDA, and (iii) ESI market value
(27MM shares x $23.25 x 83.3%).
(2) Net proceeds are after deduction for estimated taxes, based on an estimated tax basis
and an assumed tax rate of 40%.
(3) World Directories EBITDA after minority interest of $11MM.
(4) Assumes net proceeds used to paydown debt bearing interest at 7.5%.
(5) Estimates; assumes 40% of 1998P D&A allocated to gaming.
(6) 1998 EPS multiple represents Marriott Int'l current trading multiple, 1998 FFO multiple
represents HOT/Westin/ITT current trading multiple.
(7) Derivation of the implied purchase multiple HOT/Westin will pay for ITT assets that are
not sold.
</FN>
</TABLE>
