<PAGE> 1
===============================================================================
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: November 15, 1996
(Date of earliest event reported)
ENSTAR INCOME PROGRAM II-1, L.P.,
A GEORGIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
GEORGIA COMMISSION FILE: 58-1628877
(State or other jurisdiction 0-14508 (I.R.S. Employer identification No.)
of incorporation or
organization)
10900 WILSHIRE BOULEVARD, 15TH FLOOR
LOS ANGELES, CALIFORNIA 90024
(Address of principal executive offices, including zip code)
(310) 824-9990
(Registrant's phone number, including area code)
===============================================================================
1
<PAGE> 2
===============================================================================
ITEM 5. OTHER EVENTS
On November 5, 1996 and November 6, 1996, Everest Cable Investors,
L.L.C. and JJJ Group, L.L.C., respectively and separately, each disseminated a
letter stating their interest in acquiring up to 1,466 units of limited
partnership interests in Enstar Income Program II-1, L.P. (the "Registrant")
for a price of $140 and $150 per unit, respectively, less certain transaction
costs. These offers were made without the consent or involvement of the
Registrant's Corporate General Partner. The Corporate General Partner has
considered each offer, concluded that each is inadequate and, accordingly,
recommended that limited partners not accept either offer. Pursuant to Rule
14e-2 promulgated under the Securities Exchange Act of 1934, as amended, this
recommendation and the Corporate General Partner's bases therefor were conveyed
to limited partners in a letter dated November 15, 1996 which is filed as an
exhibit hereto and incorporated herein by this reference.
FORWARD-LOOKING STATEMENTS CONTAINED OR REFERRED TO IN THIS REPORT ARE
MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED. INVESTORS ARE CAUTIONED THAT SUCH
FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES INCLUDING, WITHOUT
LIMITATION, THE EFFECTS OF LEGISLATIVE AND REGULATORY CHANGES; THE POTENTIAL OF
INCREASED LEVELS OF COMPETITION FOR THE PARTNERSHIP; TECHNOLOGICAL CHANGES; THE
PARTNERSHIP'S DEPENDENCE UPON THIRD-PARTY PROGRAMMING; THE ABSENCE OF
UNITHOLDER PARTICIPATION IN THE GOVERNANCE AND MANAGEMENT OF THE PARTNERSHIP;
THE MANAGEMENT FEES PAYABLE TO THE CORPORATE GENERAL PARTNER; THE EXONERATION
AND INDEMNIFICATION PROVISIONS CONTAINED IN THE PARTNERSHIP AGREEMENT RELATING
TO THE CORPORATE GENERAL PARTNER; OTHER POTENTIAL CONFLICTS OF INTEREST
INVOLVING THE CORPORATE GENERAL PARTNER AND ITS AFFILIATES; AND OTHER RISKS
DETAILED FROM TIME TO TIME IN THE PARTNERSHIP'S ANNUAL REPORT ON FORM 10-K AND
OTHER PERIODIC REPORTS FILED WITH THE COMMISSION.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
5.1 Letter to Limited Partners dated November 15, 1996.
* * * *
2
<PAGE> 3
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.
ENSTAR INCOME PROGRAM II-1, L.P.
a Georgia limited partnership
By: Enstar Communications Corporation
General Partner
Date: November 15, 1996. By: /s/ Michael K. Menerey
-----------------------------
Michael K. Menerey
Chief Financial Officer
3
<PAGE> 4
<TABLE>
<CAPTION>
Sequentially
Numbered
Exhibit Description Page
------- ----------- ------------
<S> <C> <C>
5.1 Letter to Limited 5
Partners dated
November 15, 1996
</TABLE>
4
<PAGE> 1
(Enstar Letterhead)
November 15, 1996
Dear Limited Partner:
Enstar Income Program II-1, Ltd. (the "Partnership") has become aware
that two separate unsolicited offers, each for up to 1,466 units (representing
approximately 4.9% of the outstanding Units in the Partnership), were commenced
by:
1. Everest Cable Investors, L.L.C. ("Everest") at a price of $140 per
Unit, in a letter dated November 5, 1996; and
2. JJJ Group, L.L.C. ("JJJ Group") at a price of $150 per Unit, in a
letter dated November 6, 1996.
THESE OFFERS WERE MADE WITHOUT THE CONSENT OR THE INVOLVEMENT OF THE
CORPORATE GENERAL PARTNER.
Pursuant to rule 14e-2 under the Securities Exchange Act of 1934, we
are required to furnish you with our position with respect to the above offers.
We have considered these offers and, based on the very limited information made
available by Everest and JJJ Group, believe that each is inadequate, not
representative of the inherent value of the Partnership's cable systems and not
in your best interest to accept. Accordingly, the Corporate General Partner's
recommendation is that you reject both the Everest offer and the JJJ Group
offer. We urge you not to sign either the Agreement of Transfer for Limited
Partnership Interest Form (sent by Everest) or the Limited Power of Attorney
(sent by JJJ Group) and not to tender your Units to either Everest or JJJ
Group. In evaluating the offers, the Corporate General Partner believes that
its limited partners should consider the following information:
- - The offering price for each limited partnership unit during
the offering period was $250 per unit. Cash distributions of
approximately $143 per unit were paid from formation through
October 31, 1996. The Partnership expects to continue to pay
quarterly distributions to Unitholders during the remainder of
1996 at the annualized rate of five percent. In contrast,
Everest's offer is $140 per unit while JJJ Group's offer is
$150 per unit. Limited partners should note that the
Partnership's cash flow (operating income before depreciation
and amortization) for the twelve months ended September 30,
1996 was approximately $40 per unit. The Everest and JJJ Group
offer each represent a valuation of only approximately 1.3
times and 1.6 times said cash flow, respectively (after
adjustment for the excess of current assets over total
liabilities as of September 30, 1996).
- - As of the date of this letter, the Corporate General Partner
believes that a reasonable range of valuation per limited
partnership unit is between $304 and $382 based on the factors
noted below. The Corporate General Partner believes that each
of the above offers is inadequate because the price in each
offer does not even approach the $304 low end of the range
provided. The Corporate General Partner did not retain a third
party to conduct an evaluation of the Partnership's assets or
otherwise obtain any appraisals. Rather, the per unit
valuations provided were derived by attributing a range of
multiples to the Partnership's cash flow (operating income
before depreciation and amortization) for the twelve months
ended September 30, 1996, adjusted for the excess of current
assets over total liabilities. The Corporate General Partner
has selected market multiples based on, among other things,
its understanding of the multiples placed on other
transactions involving comparable cable television properties
and the securities of companies in that industry. The
Corporate General
5
<PAGE> 2
- - Partner's belief as to the valuation range provided is
necessarily based on economic, industry and financial market
conditions as they exist as of the date of this letter, all of
which are subject to change, and there can be no assurance
that the Partnership's cable properties could actually be sold
at a price within this range. Additionally, the valuations
provided do not give effect to any brokerage or other
transaction fees that might be incurred by the Partnership in
any actual sale of the Partnership's system.
- - Furthermore, you should also be aware that there is a limited
secondary market for sale of partnership units. Partnership
Spectrum, an independent industry publication, has reported
that between August 1, 1996 and September 30, 1996, 8 Units
were sold on the secondary market at $141 per unit. The
Corporate General Partner believes that the price for units in
the secondary market is not an accurate reflection of the fair
market value of such units due to the low volume of
transactions in that limited market and the legal and tax
restrictions on such transfers.
For the reasons discussed above, the Corporate General Partner
believes that the Everest offer and the JJJ Group offer are not in the best
interest of the limited partners and recommends that you NOT transfer, agree
to transfer, or tender any units in response to either the Everest offer or
the JJJ Group offer.
If you have any questions regarding these matters or your
investment, please call our Investor Services Department at (800) 433-4287.
Sincerely,
Enstar Income Program II-1, Ltd.
A Georgia Limited Partnership
cc: Account Representative
6
