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ADT LIMITED
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(Name of Registrant as Specified In Its Charter)
WESTERN RESOURCES, INC.
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(Name of Person(s) Filing Proxy Statement)
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<PAGE>
The following analysts' presentation was given on April 16, 1997:
[logo] Western Resources
Kansas City Securities Association
April 16, 1997
<PAGE>
Western Resources Vision
"Western Resources will be the leading provider of energy and
energy-related services for homes and businesses."
<PAGE>
History
1924 - Company founded under the name The Kansas Power and Light Company
1980 - Profile - The Kansas Power and Light Company
400,000 customers
Less than $1 billion total assets
Less than $300 million in market value
$49 million earnings
1983 - Bought Gas Service Company
1992 - Merged with Kansas Gas & Electric to create Western Resources
1993 - Sold 40% of Gas Service Company for $400+ million
<PAGE>
Recent History
1996 -
Acquired The Wing Group
Announced agreement to exchange the balance of natural gas business worth
$660 million to ONEOK for 45% of ONEOK stock
Purchased Westinghouse Security Services for approximately $358 million
plus assumed certain liabilities
$3.5 billion exchange offer for ADT Limited
1997 - Reached definitive merger agreement with KLT on 2/7/97
<PAGE>
Western Financial Statistics
Market price at 4/11/97 = $30.125
52-week high/low $31.875 - $28
Dividends:
1997 indicated annual dividend = $2.10
Paid every year since 1924
Current yield = 7%
Bond ratings of BBB+, A- and A3
Net income twelve months ending 12/31/96 $169 million
EBITDA for 12 months ending 12/31/96 $591 million
With ONEOK and KLT:
Assets increase to more than $9 billion
Projected market value of approximately $3.8 billion (assuming 4/11/97
stock price and 126.5 million common shares outstanding after KLT)
<PAGE>
Today's Western Resources
Full-service, diversified energy company
1996 revenues of $2 billion
Serves 606,000 electric customers in Kansas Merger with KLT will add 430,000
more electric customers
Marketing access to 1.4 million natural gas customers in Kansas and Oklahoma
through ONEOK alliance
Nation's third-largest security provider with 430,000 monitored customers
<PAGE>
Our Strategic Plan for Growth
Build a branded national presence
Maintain a strong core utility business
Seek above average returns on energy-related investments
<PAGE>
Strategic Priority:
Branded National Presence
Characteristics:
No utility has more than 4% of electric market; our critical mass goal is 5%
- 10% of energy market
Coming legislative changes will likely allow utilities to compete for
customers like AT&T, MCI, and Sprint, instead of limiting franchises
Opportunities:
Acquire a product with characteristics similar to electricity or natural gas
that may be sold nationwide today. . . security
Sell products (energy & security) under umbrella of brand names. Today we
market under the names Westar, KPL and KGE and soon under Oklahoma Natural
Gas
Investment Strategies:
Long-term growth and income opportunities reside with being a low-cost
provider of value-added services to end-user consumers
<PAGE>
Why Security?
Unique opportunity to consolidate the industry
Business is attractive because of strong consumer demand and annual double-digit
growth rates
Home security is a profitable service
Estimated share size of U.S. markets:
(by thousands of customers)
ADT 1,200 Protection One 230
Brinks 475 Honeywell 200
Westar 430 Republic 200
Ameritech 375 Borg-Warner 150
Network 250 Rollins 120
<PAGE>
Recent Acquisition:
Westinghouse Security Systems
Transaction terms
Created 3rd largest monitored security systems company in the U.S., by
customer count
Added about 300,000 customers and branch offices in 24 states -- provides
access to 55% of US households
Cash transaction of approximately $358 million plus assumed certain
liabilities
Gain state-of-the-art centralized monitoring and customer service center
and national branch network offering an excellent platform for growth
<PAGE>
Western Resources' Offer for ADT
$22.50 per ADT common share
$10.00 in cash
$12.50 in WR common stock*
Western Resources already owns 38.3 million ADT shares at an average cost of
$15.40 per share
Pending litigation
Invalidate Republic warrants
Disallow vote of treasury stock held by an ADT subsidiary
Invalidate dead hand poison pill
Tyco is worth (pre-tax) $16.67 per WR share
* Represents 0.41322 of a share of Western Resources' common stock for each
share of ADT common stock based on the closing price of Western Resources'
common stock on February 28, 1997. ADT shareowners would not, however,
receive more than 0.42017 share of Western Resources common stock.
<PAGE>
Strategic Priority: Strong Core Business
Characteristics:
Low-cost producer of energy
Strong brand identity
Superior customer satisfaction levels
Opportunities:
Increase product offerings to consumers
Lower costs through reorganization
Investment Strategies :
Expand geographic footprint
Focus on low-cost generation
<PAGE>
Status report:
ONEOK Strategic Alliance
Western contributes all of its gas assets to ONEOK to create the 8th largest
LDC in the country
Receive $34.7 million in preferred dividends plus 10% of equity earnings and
common dividends
Earnings and cash flow accretive to Western shareowners in the first full year
$660 million transaction will make Western Resources the largest shareowner
of ONEOK with 45% ownership on a fully converted basis. ONEOK worth $10.00 per
share of WR
Western gains access to an additional 735,000 customers to market unregulated
products and services
<PAGE>
Status Report:
Kansas City Power & Light (KLT) merger
Merger agreement reached at 2/7/97
Adds 430,000 electric customers and $900 million in revenues
Expect to close early 1998
<PAGE>
Description of Offer: KLT
TERM SUMMARY
Consideration $32.00 of WR common stock per
share of KLT common stock*
Number of WR common shares
capped at 1.100 per each KLT
common share
Current exchange ratio, based on
4/2/97 closing price is 1.045
Includes price protection provision
Form of Transaction Tax-free stock swap, pooling-of-
interests transaction worth $2
billion
*Subject to an exchange ratio of 0.917 to 1.100
Western Resources common shares for each KLT share
common stock.
<PAGE>
Exchange Ratio Calculation
<TABLE>
Calculation of Stock Price and Dividends to KLT Shareholders -- current indicated dividends
<CAPTION>
Western Exchange Stock Premium Dividend Increase
Stock Ratio Value to KLT to KLT in KLT
Price WR/KLT to KLT April 12 Holders (1) Dividend (1)
<S> <C> <C> <C> <C> <C> <C>
$27.00 1.100 $29.70 24.4% $2.31 42.6%
27.50 1.100 30.25 26.7% 2.31 42.6%
28.00 1.100 30.80 29.0% 2.31 42.6%
28.50 1.100 31.35 31.3% 2.31 42.6%
29.00 1.100 31.90 33.6% 2.31 42.6%
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Collar 29.09 1.100 32.00 34.0% 2.31 42.6%
29.50 1.085 32.00 34.0% 2.31 40.7%
30.00 1.067 32.00 34.0% 2.28 38.3%
30.50 1.049 32.00 34.0% 2.24 35.8%
31.00 1.032 32.00 34.0% 2.17 34.0%
31.50 1.016 32.00 34.0% 2.13 31.5%
32.00 1.000 32.00 34.0% 2.10 29.6%
32.50 0.985 32.00 34.0% 2.07 27.8%
33.00 0.970 32.00 34.0% 2.04 25.9%
33.50 0.955 32.00 34.0% 2.01 24.1%
34.00 0.941 32.00 34.0% 1.98 22.2%
34.50 0.928 32.00 34.0% 1.95 20.4%
Collar 34.90 0.917 32.00 34.0% 1.93 19.1%
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35.00 0.917 32.10 34.5% 1.93 19.1%
35.50 0.917 32.55 36.3% 1.93 19.1%
36.00 0.917 33.01 38.3% 1.93 19.1%
(1) Based on current indicated dividends
</TABLE>
<PAGE>
Western Resources / KLT / ONEOK
Combined Regulated Service Territory
[MAP]
<PAGE>
Strategic Priority:
Seek Above Average Rates of Return in
Energy-related Investments
Hanover
Acquired Contract Compression in 1992 for $20 million
3rd largest gas compressor rental fleet in the U.S.
Merged with Hanover in 1995 and created largest gas compressor rental fleet
in U.S. and 2nd largest in South America
WR owns 24% of Hanover Compressor
Hanover has filed to go public valuing WR's ownership at $80 to $100 million
<PAGE>
Status Report:
The Wing Group
Purchased in early 1996
Premier developer of power projects in the world
Finalized agreement with CPI in December, involving more than 2,000 MW
coal-fired generation in China
Closed on Turkey project, a 478 MW combined-cycle plant
Closed on project to participate in 160 MW gas-fired plant in Colombia
<PAGE>
Future View - Financial
Outlook of new WR with KLT, ONEOK, and security transactions completed:
Positioned to build long-term shareowner value
Recurring monthly revenue under multi-year, renewable security contracts
Growing revenue streams from new products and expanded markets
Improved margins from operating synergies and economies of scale
Continued acquisition efforts consistent with growth strategy
Delivering on our strategy will ensure continued access to capital markets
Committed to maintaining investment grade credit quality
<PAGE>
This analysts' presentation is neither an offer nor an exchange nor a
solicitation of an offer to exchange shares of common stock of ADT Limited. Such
offer is made solely by the Prospectus dated March 14, 1997, and the related
Letter of Transmittal, and is not being made to, nor will tenders be accepted
from or on behalf of, holders of shares of common stock of ADT Limited in any
jurisdiction in which the making of such offer or the acceptance thereof would
not be in compliance with the laws of such jurisdiction. In any jurisdictions
where securities, blue sky or other laws require such offer to be made by a
licensed broker or dealer, such offer shall be deemed to be made on behalf of
Western Resources, Inc. by Salomon Brothers Inc; Bear, Stearns & Co. Inc; and
Chase Securities Inc, or one or more registered brokers or dealers licensed
under the laws of such jurisdiction.
<PAGE>
The following news release/employee update was issued on April 16, 1997:
WESTERN RESOURCES CHALLENGES STRUCTURE OF
ADT/TYCO COMBINATION
TOPEKA, Kansas, April 16, 1997 (4 pm CDT) -- Western Resources (NYSE:WR)
announced today that it has commenced a lawsuit against ADT Limited in the
Supreme Court of Bermuda alleging that the structure of Tyco International
Ltd.'s proposed acquisition of ADT Limited denies Western Resources and
other ADT shareholders their valuable appraisal rights provided under
Bermuda law.
Such appraisal rights, which give shareholders a right to be paid the
fair value of their shares in cash, are valuable in the context of the Tyco
transaction because the value of that transaction to ADT shareholders
depends on Tyco's stock price, which has fluctuated considerably since
announcement of the merger agreement.
The lawsuit seeks an order requiring that Tyco's acquisition of ADT be
structured to provide appraisal rights to ADT shareholders.
- 30 -
Western Resources (NYSE:WR) is a full-service, diversified security and
energy company with total assets of more than $6 billion. Its utilities,
KPL and KGE, operating in Kansas and Oklahoma, provide natural gas service
to approximately 650,000 customers and electric service to approximately
600,000 customers. Western Resources, through its subsidiary, Westar
Security, also is the third-largest monitored security provider in the
country, operating in 46 states in the U.S. Through its other subsidiaries,
Westar Energy, Westar Capital, and The Wing Group, a full range of energy
and energy-related products and services are developed and marketed in the
continental U.S. and offshore.
For more information about Western Resources and its operating
companies, visit us on the Internet at http://www.wstnres.com.
This news release/employee update is neither an offer nor an exchange
nor a solicitation of an offer to exchange shares of common stock of ADT
Limited. Such offer is made solely by the Prospectus dated March 14, 1997,
and the related Letter of Transmittal, and is not being made to, nor will
tenders be accepted from or on behalf of, holders of shares of common
stock of ADT Limited in any jurisdiction in which the making of such offer
or the acceptance thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdictions where securities, blue sky or other laws
require such offer to be made by a licensed broker or dealer, such offer
shall be deemed to be made on behalf of Western Resources, Inc. by Salomon
Brothers Inc; Bear, Stearns & Co. Inc; and Chase Securities Inc, or one or
more registered brokers or dealers licensed under the laws of such
jurisdiction.
