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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): December 22, 1999
MONSANTO COMPANY
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-2516 43-0420020
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(State or Other Jurisdiction of (Commission File Number) (IRS Employer
Incorporation or Organization) Identification No.)
800 North Lindbergh Boulevard 63167
St. Louis, Missouri --------------------
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(Address of Principal Executive Offices)
(314) 694-1000
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(Registrant's telephone number, including area code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. Other Events.
On December 22, 1999, Monsanto Company, a Delaware corporation
("Monsanto") and Pharmacia & Upjohn, Inc., a Delaware corporation ("P&U"),
announced additional financial details relating to the previously announced
merger agreement between the two companies.
A copy of the joint press release issued by Monsanto and P&U on
December 22, 1999 is attached hereto as Exhibit 99.1, and a copy of the
presentation first provided to securities analysts on December 22, 1999 is
attached hereto as Exhibit 99.2. Exhibit 99.1 and Exhibit 99.2 are each hereby
incorporated by reference herein.
ITEM 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits
(99.1) Press Release, dated December 22, 1999.
(99.2) Analyst Presentation.
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SIGNATURES
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 hereunto duly authorized.
MONSANTO COMPANY
By: /s/ Barbara L. Blackford
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Name: Barbara L. Blackford
Title: Chief Counsel and
Assistant Secretary
Dated: December 22, 1999
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EXHIBIT INDEX
Exhibit
No. Description
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99.1 Press Release, dated December 22, 1999.
99.2 Analyst Presentation.
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EXHIBIT 99.1
MONSANTO AND PHARMACIA & UPJOHN PROVIDE ADDITIONAL
FINANCIAL INFORMATION RELATING TO COMPANIES' PLANNED MERGER
ST. LOUIS and PEAPACK, NJ (Dec. 22, 1999) - Monsanto Company (NYSE: MTC) and
Pharmacia & Upjohn (NYSE: PNU) today announced additional financial details
relating to the planned merger between the two companies.
The companies said that estimated full year 1999 sales of the combined
continuing operations of Monsanto and Pharmacia & Upjohn will consist of
approximately $11.3 billion in pharmaceutical sales and $5.2 billion in sales
from Monsanto's agricultural business. Between 1999-2002, the combined
pharmaceutical business is expected to grow at an annual rate of 14-15%,
including a somewhat higher growth rate in prescription pharmaceuticals. During
the same period, the agricultural business is expected to grow at an annual rate
of 10-12%.
The companies also said that the combined Earnings Before Interest and Taxes
(EBIT) margin in 1999 is estimated to be 16% for the pharmaceutical business and
is estimated to improve to 22% by 2002. The EBIT margin for the agricultural
business is expected to average 15% through 2002.
The companies estimate that their combined debt (net of cash) in 1999 is $6.8
billion. This is estimated to be reduced to $4.5 billion by the end of 2000 and
below $2.5 billion in 2001. The reduction in the year 2000 includes expected
proceeds from the planned divestiture of Monsanto's Nutrition and Consumer
businesses as well as from operating cash flow. This debt reduction does not
include the impact of any anticipated proceeds of the planned partial Initial
Public Offering (IPO) of the agricultural business.
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-2-
The pro forma tax rate of the combined company for 1999 is estimated to be
32.5%. The companies' estimated tax rate in 2002 is 31%.
On a pro forma basis, the company estimates earnings per share (EPS) in 2000 of
$1.55 - $1.62. After 2000, the combined company is expected to achieve annual
EPS growth of more than 20 percent.
This news release contains certain forward-looking statements, including, among
other things, statements regarding each company's results of operations and
expected cost savings and earnings per share effects. These forward-looking
statements are based on current expectations, but actual results may differ
materially from anticipated future events or results. Certain factors which
could cause each company's actual results to differ materially from expected and
historical results are described in Monsanto's and Pharmacia & Upjohn's periodic
reports filed with the Securities and Exchange Commission, including Monsanto's
and Pharmacia & Upjohn's 1998 annual reports and Forms 10-K and Exhibits 99
thereto, respectively.
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Pharmacia & Upjohn Media Contact: Monsanto Company Media Contact:
Paul Fitzhenry (908) 901-8770 Scarlett Lee Foster (314) 694-2883
Pharmacia & Upjohn Analyst Contact: Monsanto Company Analyst Contact:
Craig Tooman (908) 901-8851 Nick Filippello (314) 694-8148
EXHIBIT 99.2
Monsanto and Pharmacia & Upjohn
Growth Outlook
($ millions)
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<S> <C> <C> <C>
1999E 2000F Annual Growth: 1999-2002
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Combined o Sales $11,300 $13,000 Mid-teens growth with higher growth in Rx
Pharma
o EBIT 16% 18% Upper-teen growth with 1.5% per year margin
improvement
1999E 2000F Annual Growth: 1999-2002
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o Sales $5,200 $5,900 Growth of 10-12%
Ag
o EBIT 15% 15% Growth consistent with sales
2000F Annual Growth: 1999-2002
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<S> <C> <C>
Total o EPS $1.55-1.62 Greater than 20% earnings growth
Company
o Tax Rate 32.5% Expected to be 31% by 2002
o Debt(1) $4,500 Expect to be below $2.5 billion in 2001
Footnote: (1) Excludes proceeds of anticipated Ag IPO
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