UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported) September 2, 1998
(Exact name of registrant as specified in its charter)
DST Systems, Inc.
Delaware 1-14036 43-1581814
(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
333 West 11th Street, Kansas City, Missouri 64105
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (816) 435-6568
Not Applicable
(Former name or former address, if changed since last report.)
<PAGE>
FORM 8-K
DST SYSTEMS, INC.
ITEM 1 CHANGES IN CONTROL OF REGISTRANT
Not applicable.
ITEM 2 ACQUISITION OR DISPOSITION OF ASSETS
Not applicable.
ITEM 3 BANKRUPTCY OR RECEIVERSHIP
Not applicable.
ITEM 4 CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 5 OTHER EVENTS
See attached as an Exhibit to this Form 8-K a News Release released September 2,
1998 concerning the announcement of the merger of USCS International, Inc. with
a wholly-owned subsidiary of the Registrant.
ITEM 6 RESIGNATIONS OF REGISTRANT'S DIRECTORS Not applicable.
ITEM 7 FINANCIAL STATEMENTS AND EXHIBITS
Not applicable.
ITEM 8 CHANGE IN FISCAL YEAR
Not applicable.
SIGNATURE
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.
DST Systems, Inc.
/s/ Robert C. Canfield
Senior Vice President, General Counsel,
Secretary
Date: September 8 1998
September 2, 1998
DST Systems, Inc. and USCS International, Inc. Announce Merger
DST Systems, Inc. (DST) and USCS International, Inc. (USCS) jointly announce
that they have signed an agreement to merge USCS with a wholly owned subsidiary
of DST. Under the terms of the agreement, each USCS shareowner will receive 0.62
shares of DST common stock for each share of USCS common stock. The Board of
Directors of each company has approved the transaction, which is intended to be
a tax free reorganization and accounted for as a pooling of interests. Based on
the closing price of DST stock on September 2, 1998, the transaction, if
consummated on that date, values USCS shares at $37.51 per share, and results in
an aggregate value of approximately $874 million.
This merger, which is projected to be accretive to DST's earnings per share in
1999, represents a significant expansion of DST's presence in the output
processing and customer management software and services industries. USCS,
through its CableData, Inc. subsidiary, is the largest provider of customer
management software to the cable television and convergence industries,
currently servicing approximately 40 million subscribers worldwide. DST, through
its DBS Systems Corporation subsidiary, provides subscriber management services
to DirecTV. USCS' subsidiary, International Billing Services, Inc., provides
bill presentation services to a variety of communications and other services.
DST's subsidiary, Output Technologies, Inc., provides a variety of output
related services to a diversified group of industries, primarily in the
financial services sector. The combination of these businesses is expected to
generate synergy savings through combined economies of scale and coordinated
production efficiencies. Additional savings will be realized through the
elimination of duplicate costs associated with having two public companies.
The combined entity will generate approximately $1.1 billion in annual revenues,
have approximately $1.1 billion in stockholders' equity and have 8,000 employees
worldwide. It will be a leading provider of services in three growing
industries, mutual fund shareowner processing, customer management services, and
output processing.
The transaction is subject to regulatory approval under the Hart-Scott-Rodino
Act and approval by the shareholders of both companies. The largest shareowner
of each company (Kansas City Southern Industries, Inc., which now owns
approximately 41% of DST's common stock, and George L. Argyros, a USCS director
who now owns approximately 33% of USCS) have each agreed to vote for the merger.
At the completion of the transaction, Mr. Argyros and James C. Castle, Chairman
and Chief Executive Officer of USCS, will be appointed to the DST Board of
Directors.
The merger is expected to be completed in the fourth quarter of 1998.
DST Systems, Inc. provides sophisticated information processing and computer and
software services and products, primarily to mutual funds, insurance providers,
banks and other financial organizations. Its software systems include
recordkeeping and marketing services to the U.S. mutual fund industry; domestic
and international portfolio accounting and investment management systems offered
to fund accountants and managers of investment portfolios; and an image-based
work management system offered primarily to mutual funds, insurance companies
and other financial services businesses.
USCS is a leading global provider of customer management software and statement
processing to the communications and other service industries. USCS' clients
include providers of cable television, wireless and wire-line telephony, direct
broadcast satellite, and utility services.
The information and comments above include forward-looking statements respecting
DST and USCS and their businesses and the results of the transaction described.
Such information and comments are based on DST's and USCS' views as of today,
and actual results could differ. There could be a number of factors affecting
actual future results, including those set forth in Form 8-K/A dated April 13,
1998 filed by DST with the Securities and Exchange Commission (SEC) and those
set forth by USCS in the Form S-1 filed with the SEC and declared effective by
the SEC on June 20, 1996, and Form 10-Q for the quarter ended June 30, 1998
filed with the SEC. All such factors should be considered in evaluating any
forward-looking comments.
DST Systems, Inc.
333 West 11th Street
Kansas City, MO
64105-1594
NYSE Symbol: DST
Contacts:
DST
Thomas A. McDonnell (816) 435-8684
President and Chief Executive Officer
Kenneth V. Hager (816) 435-8603
Vice President and Chief Financial Officer
USCS
Douglas Shurtleff (916) 636-5861
Senior Vice President and Chief Financial Officer
Linda Cutler (916) 636-5861
Vice President, Investor Relations
