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 EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 27, 1995
3Com Corporation
(Exact name of registrant as specified in its charter)
California 0-12867 94-2605794
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer)
incorporation or organization) Identification No.)
5400 Bayfront Plaza 95052
Santa Clara, California (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (408) 764-5000
Item 5. Other Events
In a press release disseminated on July 27, 1995, the registrant
publicly announced the execution of a definitive agreement to merge
Chipcom Corporation ("Chipcom") into a wholly-owned subsidiary of the
registrant. Under the terms of the agreement, .53 of a share of the
registrant's common stock will be exchanged for each outstanding share
of Chipcom common stock (or 1.06 shares, giving the effect to the
registrant's pending 2-for-1 stock split). Based upon the closing
price of the registrant's common stock on July 26, 1995, the
transaction is valued at approximately $775 million. The transaction
is expected to close in October 1995. A copy of the press release is
attached hereto as an exhibit and is incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
A copy of the registrant's press release dated
July 27, 1995, announcing its agreement to merge Chipcom
into a wholly-owned subsidiary of the registrant is attached
hereto as an exhibit and is incorporated herein by
reference.
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.
3COM CORPORATION
July 31, 1995 By: /s/ Christopher B. Paisley
---------------------------
Christopher B. Paisley
Chief Financial Officer
INDEX TO EXHIBITS
Exhibit Document
- ------- --------
99.1 Press release disseminated July 27, 1995
Exhibit 99.1
Contacts:
3Com Public Relations 3Com Investor Relations
Donna Stein Kate Patterson
(408) 764-5960 (408) 764-6802
David Hayward
(508) 836-1773
Chipcom Public & Investor Relations Langdon Cook
John H. Ricciardone Coltrin & Associates
(508) 624-6840 (212) 221-1616
FOR IMMEDIATE RELEASE:
July 27, 1995
3COM TO ACQUIRE CHIPCOM CORPORATION AND EXPAND
STRATEGIC RELATIONSHIP WITH IBM
3Com grows to #2 networking market position and strengthens high-end,
integrated chassis solution
SANTA CLARA, Calif. -- 3Com Corporation (NASDAQ:COMS), the world's
fastest-growing network systems vendor, today announced the execution of
a definitive agreement to merge Chipcom Corporation (NASDAQ:CHPM), a
leader in multifunction intelligent switching systems, into a wholly
owned subsidiary of 3Com Corporation. 3Com also announced a memorandum
of understanding with IBM Corporation's Networking Hardware Division to
extend existing strategic agreements between IBM and Chipcom upon
completion of the acquisition (see accompanying release).
Under the terms of the agreement, .53 of a share of 3Com common
stock will be exchanged for each outstanding share of Chipcom common
stock (or 1.06 shares, giving effect to 3Com's pending 2-for-1 stock
split). Based upon the closing price of 3Com common stock on July 26,
1995, the transaction is valued at approximately $775 million. The
combination will be accounted for as a pooling of interests* (see
footnote for additional information).
When the acquisition is completed, the two companies' combined
share of the worldwide hub market will be approximately 19% (based on
IDC's 1994 analysis of port shipments). Already the largest vendor of
stackable systems, 3Com will become the #2 vendor in the overall
intelligent hub market, including both stackables and chassis-based
systems.
"This acquisition is an important milestone in 3Com's strategy to
offer customers the most comprehensive family of enterprise network
infrastructure products," said Eric Benhamou, 3Com's chairman and chief
executive officer. "3Com and Chipcom share a strong customer focus, a
history of technological innovation and a systems approach to meeting
customers' networking needs. Together we will be a formidable
competitor, combining 3Com's leading market position in stackable
systems and backbone switching with Chipcom's leadership in chassis-
based multifunction intelligent switching systems."
"Chipcom's high-end chassis-based switching systems and 3Com's
products are complementary and our company cultures are very compatible.
We're very excited that Chipcom's next phase of growth will be as part
of the 3Com team. 3Com has an excellent track record of growing and
building its acquisitions and delivering on customer commitments," said
Rob Held, president and chief executive officer of Chipcom.
"Chipcom's ONline and ONcore multifunction switching systems and
ONdemand network management solutions are an excellent fit within 3Com's
High Performance Scalable Networking and Transcend network management
architecture," said Benhamou. "Users will benefit from synergies
between the best products in both companies' product lines."
Complementary Products and Partnerships
Following today's announcement, Chipcom's partners and customers
will have access to 3Com products including SuperStack and LinkSwitch
stackable hub and workgroup switching families, remote office
internetworking solutions and LANplex data center switching line,
Benhamou said. He also announced that the two companies' product and
development teams will immediately start working on plans to bring
ONdemand under the Transcend management architecture. The unified
network management solution will include state-of-the art virtual
network management leveraging the combined switching technology
expertise of both companies.
Both companies share a tradition of product design that protects
customer investment, designing next-generation hubs for compatibility
with their earlier product lines. Both companies were early proponents
of fault tolerant design in hub and switching platforms, eliminating
downtime for critical network applications.
Besides strengthening 3Com's presence in large end-user accounts,
the company will broaden its project sales force and channel
partnerships with Chipcom's single-tier, technical VARs and systems
integrators. In addition to its alliance with IBM, Chipcom's major
channel partners include Anixter (already a major 3Com channel partner),
Bell Atlantic, Digital, Andersen Consulting, Ascom Timeplex and
Ericsson.
Global Scope
Both companies have strong global marketing and support
organizations which will be strengthened as a result of the acquisition.
3Com is the largest independent data networking vendor and the largest
hub vendor in Europe. With sales offices in 32 countries, 3Com currently
derives 54 percent of its sales outside the United States. Chipcom has
offices in 30 countries, with 48 percent of its business outside the
U.S.
Organizational Structure
Following completion of the acquisition, Chipcom will become a
division of 3Com. Its engineering, marketing and manufacturing
activities will continue to operate from its present headquarters in
Southborough, Mass. under the direction of Bob Finocchio, 3Com's
Executive Vice President, Network Systems Operation. Chipcom's sales
force will join 3Com's field organization, reporting to Bill Marr,
3Com's executive vice president of worldwide sales.
Founded in 1983, Chipcom Corporation designs, manufactures,
markets and supports fault-tolerant, intelligent switching systems,
including hub, internetworking and network management products for
remote site, campus and enterprise network computing environments. The
Southborough, Mass.-based company reported record revenue of $268
million for its 1994 fiscal year, ended December 31. For its first half
of Fy 95, ended July 1, Chipcom's revenues were $157.7 million.
Chipcom's Worldwide Web site can be reached at http.//www.Chipcom.com.
3Com Corporation has helped more than 22 million people gain
access to critical information through high speed networks. Designed to
serve large enterprises, small offices and homes, 3Com products provide
a scalable architecture to meet the immediate and long-term connectivity
needs of today's user. With research and development on three
continents, 3Com is one of the data networking industry's largest and
fastest growing companies. The company's innovative manufacturing,
marketing, sales and support simplify communication, optimize network
reliability and protect customer investments. For further information,
visit 3Com's WorldWide Web site at: http://www.3Com.com.
###
* Additional information on terms of the agreement: The transaction
requires the approval of a majority of the outstanding shares of Chipcom
common stock, which will be sought at a special stockholders' meeting
expected to take place in October, 1995. The transaction is also
subject to government approvals and notification periods as well as the
receipt of customary opinions with respect to the accounting and tax
treatment of the transaction. A Proxy Statement and Prospectus relating
to the transaction is expected to be issued in September 1995.
Note to editors: 3Com, LANplex, LinkSwitch and LinkBuilder are
registered trademarks of 3Com Corporation. Chipcom and ONcore are
registered trademarks and ONline and ONdemand are trademarks of Chipcom
Corporation. All other trademarks belong to their respective
organizations.
