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SCHEDULE 14A
(RULE 14A-101)
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
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1
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FOR IMMEDIATE RELEASE
Contacts:
Richard Skaare Dan Katcher / Judith Wilkinson
AMP Corporate Communication Abernathy MacGregor Frank
717/592-2323 212/371-5999
Doug Wilburne
AMP Investor Relations
717/592-4965
AMP BOARD OF DIRECTORS REJECTS
ALLIEDSIGNAL'S UNSOLICITED OFFER
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HARRISBURG, Pennsylvania (August 21, 1998) -- AMP Incorporated (NYSE: AMP)
announced today that its Board of Director, by unanimous vote of the directors
present, has recommended that shareholders reject the unsolicited tender offer
by AlliedSignal, Inc. (NYSE: ALD) for $44.50 in cash per share for all of the
outstanding shares of AMP as not in the best interests of the Company, its
shareholders, employees, customers, suppliers and other relevant constituencies.
In its recommendation to AMP shareholders, the Board cited, among other things:
- - the Board's belief that the AlliedSignal offer is inadequate and does not
reflect the inherent value of AMP as the world's largest supplier of
electrical and electronic connectors;
- - the Board's commitment to revitalizing AMP and its belief that the Company's
stock price should increase significantly as the strategic initiatives
announced in June, prior to the commencement of the AlliedSignal offer,
start to take effect;
- - the depressing effect the disruption in the Asian market has had on AMP and
the trading price of its shares;
- - the written opinion dated August 20, 1998 of Credit Suisse First Boston that
the AlliedSignal offer is inadequate, from a financial point of view, to the
holders of shares of AMP (other than AlliedSignal and its affiliates);
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- - the lack of synergies between the respective businesses of AMP and
AlliedSignal; and
- - the numerous conditions to which the AlliedSignal offer is subject.
Accordingly, the Board recommends that AMP shareholders not tender
their shares to AlliedSignal.
Robert Ripp, AMP's newly elected chairman and chief executive officer, said,
"AlliedSignal has launched its offer at a time when AMP's business, like those
of other companies similarly situated, is under pressure from a significant, but
ultimately temporary, economic downturn in the Far East and, accordingly, when
AMP's stock price was near the low point of the past twelve years. Moreover,
AlliedSignal is seeking to move hurriedly before the positive impact of our
fully designed profit improvement plan, which was recently put in place, can
even begin to be felt. The offer is nothing more then than an attempt to buy
AMP on the cheap. AlliedSignal's offer is more than 20% below AMP's peak price
and 10% below our share price just a few months ago. It is clearly an
opportunistic attempt to grab a world industry leader at a bargain price."
After an in-depth review of AlliedSignal's offer by financial advisor Credit
Suisse First Boston and legal counsel Skadden, Arps, Slate, Meagher & Flom LLP,
the Board weighed the offer against the expected benefits to AMP and its
relevant constituencies, including shareholders, of the Company's profit
improvement plan, which was first announced in June 1998, a month prior to the
AlliedSignal offer. The plan is on track and 3500 employees are expected to
leave the Company through a combination of early retirement, attrition and
layoffs by year-end. Savings from those actions and others, combined with
expected improvement in sales, should generate 11% operating margins in the
fourth quarter, 13.5% operating margins in 1999 and 16.5% in 2000. Earnings per
share are expected to be $2.30 in 1999 and approximately $3.00 in 2000.
"I intend aggressively to pursue the implementation of AMP's profit improvement
initiatives, of which I am a principal architect," said Mr. Ripp. "I am sharply
focused on enhancing the value of AMP for the benefit of all its stakeholders.
AMP's business is best run by those who understand the industry and how to best
meet customers' needs. All of us at AMP are committed to moving the Company
further and faster to unlock its inherent value. I am confident that our plan
will create greater value than AlliedSignal's low-ball bid for AMP and all of
its constituencies in both the near and long-term. In addition, we have asked
our advisors to explore additional ways to enhance shareholder value while we
aggressively pursue our business strategy," he said.
AMP's profit improvement program during 1998 has included many actions to
simplify, focus, and grow the business, including: eliminating unprofitable
businesses such as the Connectware ATM business; announcing plans for selling
the sensor and touch screen businesses; reorganizing the radio frequency coax
connector business; closing and consolidating plants; expanding production in
China and increasing capacity in the cable business through a joint venture in
Asia/Pacific.
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Other initiatives include:
. REDUCTIONS IN SUPPORT STAFF AND OUTSOURCING OF SUPPORT FUNCTIONS
AMP's support staff is being reduced by 3,500 worldwide though a combination of
early retirement, attrition and layoffs. In addition, AMP will outsource
certain support activities to allow the Company to focus resources on core
businesses and provide flexibility to respond to fluctuations in product demand.
. PLANT CLOSINGS AND CONSOLIDATIONS
The streamlining and consolidation of the Terminal and Connector operation,
which represents the majority of AMP sales, will result in the closing of five
plants in 1998. Additionally, AMP is stepping up activities to support the fast
growing marketplace outside the United States by shifting production closer to
customers, thereby reducing transportation and other costs, and relying on
simpler, manual operations in each region for high-volume, quick turnaround
orders.
. SALES INITIATIVES
New customer-focused programs are being launched to make the ordering, pricing,
and delivery system simpler and more responsive to customers. The programs,
which will begin in the U.S., will be replicated in other regions of the world.
These include 24-hour customer service and shipment on more than 10,000 widely
used part numbers, simplified pricing and a larger sales force to improve
account coverage and presence at customer facilities.
AMP also announced today that it is filing with the Securities and Exchange
Commission, and will mail to shareholders, a Solicitation/Recommendation
Statement on Schedule 14D-9 setting forth the Board's recommendation with
respect to AlliedSignal's offer and the reasons therefor. Additional information
with respect to the Board's decision to recommend that shareholders reject the
AlliedSignal offer is contained in the Schedule 14D-9.
The Company also announced that the Board of Directors has authorized certain
amendments to AMP's Shareholder Rights Plan to enhance the Company's ability to
implement its profit improvement program. The amendments, which, among other
things, will make the rights nonredeemable following a majority change of
disinterested directors, in the Board of Directors, are described in the
Company's Statement on Schedule 14D-9 being filed with the Securities and
Exchange Commission. The Board of Directors also resolved not to adopt a new
rights plan for a period of at least 6 months following the expiration of the
existing plan on November 6, 1999, as a substantial portion of AMP's profit
improvement plan is expected to have been implemented and the benefits reflected
in the value of AMP.
Headquartered in Harrisburg, PA, AMP is the world's leading manufacturer of
electrical, electronic, fiber-optic and wireless interconnection devices and
systems. The Company has 48,300 employees in 53 countries serving customers in
the automotive, computer, communications, consumer, industrial and power
industries. AMP sales reached $5.75 billion in 1997.
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This press release contains certain "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Exchange Act, which are intended to be covered by the safe harbors
created thereby. Such statements should be considered as subject to risks and
uncertainties that exist in AMP's operations and business environment and could
render actual outcomes and results materially different than predicted. For a
description of some of the factors or uncertainties which could cause actual
results to differ, reference is made to the section entitled "Cautionary
Statements for Purposes of the `Safe Harbor'" in AMP's Annual Report on Form 10K
for the year ended December 31, 1997. In addition, the realization of the
benefits anticipated from the strategic initiatives described above will be
dependent, in part, on management's ability to execute its business plans and to
motivate properly the AMP employees, whose attention has been distracted by the
AlliedSignal offer and whose numbers will have been reduced as a result of these
initiatives.
# # #
AMP and certain other persons named below may be deemed to be participants in
the solicitation of revocations of consents in response to AlliedSignal's
consent solicitation. The participants in this solicitation may include the
directors of AMP (Ralph D. DeNunzio, Barbara H. Franklin, Joseph M. Hixon III,
William J. Hudson, Jr., Joseph M. Magliochetti, Harold A. McInnes, Jerome J.
Meyer, John C. Morley, Robert Ripp, Paul G. Schloemer and Takeo Shiina); the
following executive officers of AMP: Robert Ripp (Chairman and Chief Executive
Officer), William J. Hudson (Vice Chairman), William S. Urkiel (Corporate Vice
President and Chief Financial Officer), Herbert M. Cole (Senior Vice President
for Operations), Juergen W. Gromer (Senior Vice President, Global Industry
Businesses), Richard P. Clark (Divisional Vice President, Global Wireless
Products Group), Thomas DiClemente (Corporate Vice President and President,
Europe, Middle East, Africa), Rudolf Gassner (Corporate Vice President and
President, Global Personal Computer Division), Charles W. Goonrey (Corporate
Vice President and General Legal Counsel), John E. Gurski (Corporate Vice
President and President, Global Value-Added Operations and President, Global
Operations Division), David F. Henschel (Corporate Secretary), John H. Kegel
(Corporate Vice President, Asia/Pacific), Mark E. Lang (Corporate Controller),
Philippe Lemaitre (Corporate Vice President and Chief Technology Officer),
Joseph C. Overbaugh (Corporate Treasurer), Nazario Proietto (Corporate Vice
President and President, Global Consumer, Industrial and Power Technology
Division); and the following other members of management of AMP: Richard Skaare
(Director, Corporate Communication), Douglas Wilburne (Director, Investor
Relations) and Mary Rakoczy (Manager, Shareholder Services). As of the date of
this communication, none of the foregoing participants individually beneficially
own in excess of 1% of AMP's common stock or in the aggregate in excess of 2% of
AMP's common stock.
AMP has retained Credit Suisse First Boston Corporation ("CSFB") to act as its
financial advisor in connection with the AlliedSignal Offer, for which CSFB will
receive customary fees, as well as reimbursement of reasonable out-of-pocket
expenses. In addition, AMP has agreed to indemnify CSFB and certain related
persons against certain liabilities, including certain liabilities under the
federal securities laws, arising out of its engagement. CSFB is an investment
banking firm that provides a full range of financial services for institutional
and individual clients. CSFB does not admit that it or any of its directors,
officers or employees is a "participant" as defined in Schedule 14A promulgated
under the Securities Exchange Act of 1934, as amended, in the solicitation, or
that Schedule 14A requires the disclosure of certain information concerning
CSFB. In connection with CSFB's role as financial advisor to AMP, CSFB and the
following investment banking employees of CSFB may communicate in person, by
telephone or otherwise with a limited number of institutions, brokers or other
persons who are stockholders of AMP: Alan Howard, Steven Koch, Scott Lindsay,
and Lawrence Hamdan. In the normal course of its business, CSFB regularly buys
and sells securities issued by AMP for its own account and for the accounts of
its customers, which transactions may result in CSFB and its associates having a
net "long" or net "short" position in AMP securities, or option contracts or
other derivatives in or relating to such securities. As of August 19, 1998,
CSFB had a net long position of 124,466 shares of AMP common stock.
<PAGE>
FOR IMMEDIATE RELEASE
Contacts:
Richard Skaare Dan Katcher / Judith Wilkinson
AMP Corporate Communication Abernathy MacGregor Frank
717/592-2323 212/371-5999
Doug Wilburne
AMP Investor Relations
717/592-4965
AMP BOARD OF DIRECTORS SETS RECORD DATE FOR
ALLIEDSIGNAL CONSENT SOLICITATION
HARRISBURG, Pennsylvania (August 21, 1998)--AMP Incorporated (NYSE: AMP) today
announced that its Board of Directors has set an October 15, 1998 record date in
connection with AlliedSignal, Inc.'s (NYSE: ALD) intended solicitation of
written consents from AMP shareholders. Shareholders of record on that date
will be eligible to execute consents and revocations. In its consent
solicitation, AlliedSignal will attempt, among other things, to more than double
the size of the AMP Board of Directors from 11 to 28 members and to elect 17 of
its own executive officers and directors to constitute a majority of the AMP
Board.
The Company noted that its Board believes that AlliedSignal's intended consent
solicitation will place AMP's shareholders in a position of making extremely
important decisions. The Board selected October 15 to ensure that shareholders
will have adequate information and sufficient time before such decisions are
made.
Headquartered in Harrisburg, PA, AMP is the world's leading manufacturer of
electrical, electronic, fiber-optic and wireless interconnection devices and
systems. The Company has 48,300 employees in 53 countries serving customers in
the automotive, computer, communications, consumer, industrial and power
industries. AMP sales reached $5.75 billion in 1997.
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AMP and certain other persons named below may be deemed to be participants in
the solicitation of revocations of consents in response to AlliedSignal's
consent solicitation. The participants in this solicitation may include the
directors of AMP (Ralph D. DeNunzio, Barbara H. Franklin, Joseph M. Hixon III,
William J. Hudson, Jr., Joseph M. Magliochetti, Harold A. McInnes, Jerome J.
Meyer, John C. Morley, Robert Ripp, Paul G. Schloemer and Takeo Shiina); the
following executive officers of AMP: Robert Ripp (Chairman and Chief Executive
Officer), William J. Hudson (Vice Chairman), William S. Urkiel (Corporate Vice
President and Chief Financial Officer), Herbert M. Cole (Senior Vice President
for Operations), Juergen W. Gromer (Senior Vice President, Global Industry
Businesses), Richard P. Clark (Divisional Vice President, Global Wireless
Products Group), Thomas DiClemente (Corporate Vice President and President,
Europe, Middle East, Africa), Rudolf Gassner (Corporate Vice President and
President, Global Personal Computer Division), Charles W. Goonrey (Corporate
Vice President and General Legal Counsel), John E. Gurski (Corporate Vice
President and President, Global Value-Added Operations and President, Global
Operations Division), David F. Henschel (Corporate Secretary), John H. Kegel
(Corporate Vice President, Asia/Pacific), Mark E. Lang (Corporate Controller),
Philippe Lemaitre (Corporate Vice President and Chief Technology Officer),
Joseph C. Overbaugh (Corporate Treasurer), Nazario Proietto (Corporate Vice
President and President, Global Consumer, Industrial and Power Technology
Division); and the following other members of management of AMP: Richard Skaare
(Director, Corporate Communication), Douglas Wilburne (Director, Investor
Relations) and Mary Rakoczy (Manager, Shareholder Services). As of the date of
this communication, none of the foregoing participants individually beneficially
own in excess of 1% of AMP's common stock or in the aggregate in excess of 2% of
AMP's common stock.
AMP has retained Credit Suisse First Boston Corporation ("CSFB") to act as its
financial advisor in connection with the AlliedSignal Offer, for which CSFB will
receive customary fees, as well as reimbursement of reasonable out-of-pocket
expenses. In addition, AMP has agreed to indemnify CSFB and certain related
persons against certain liabilities, including certain liabilities under the
federal securities laws, arising out of its engagement. CSFB is an investment
banking firm that provides a full range of financial services for institutional
and individual clients. CSFB does not admit that it or any of its directors,
officers or employees is a "participant" as defined in Schedule 14A promulgated
under the Securities Exchange Act of 1934, as amended, in the solicitation, or
that Schedule 14A requires the disclosure of certain information concerning
CSFB. In connection with CSFB's role as financial advisor to AMP, CSFB and the
following investment banking employees of CSFB may communicate in person, by
telephone or otherwise with a limited number of institutions, brokers or other
persons who are stockholders of AMP: Alan Howard, Steven Koch, Scott Lindsay,
and Lawrence Hamdan. In the normal course of its business, CSFB regularly buys
and sells securities issued by AMP for its own account and for the accounts of
its customers, which transactions may result in CSFB and its associates having a
net "long" or net "short" position in AMP securities, or option contracts or
other derivatives in or relating to such securities. As of August 19, 1998,
CSFB had a net long position of 124,466 shares of AMP common stock.
