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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
(AMENDMENT NO. 17)
Pursuant to Section 14(d)(4) of the
Securities Exchange Act of 1934
PENNZOIL COMPANY
(Name of Subject Company)
PENNZOIL COMPANY
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $0.83 1/3 PER SHARE
(including the associated Preferred Stock Purchase Rights)
(Title of Class of Securities)
709903 10 8
(CUSIP Number of Class of Securities)
LINDA F. CONDIT
CORPORATE SECRETARY
PENNZOIL COMPANY
PENNZOIL PLACE, P.O. BOX 2967
HOUSTON, TEXAS 77252-2967
(713) 546-8910
(Name, address and telephone number of person authorized
to receive notice and communications on behalf of the person(s) filing
statement)
Copies To:
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<S> <C>
Moulton Goodrum, Jr. Charles F. Richards, Jr.
Baker & Botts, L.L.P. Richards, Layton & Finger
One Shell Plaza One Rodney Square
Houston, Texas 77002-4995 P.O. Box 551
(713) 229-1234 Wilmington, Delaware 19899-0551
(302) 658-6541
</TABLE>
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This Amendment No. 17 (this "Amendment") amends and supplements the
Solicitation/Recommendation Statement on Schedule 14D-9, as amended, originally
filed on July 1, 1997 by Pennzoil Company, a Delaware corporation (the
"Company"), relating to a tender offer commenced by Resources Newco, Inc., a
wholly owned subsidiary of Union Pacific Resources Group Inc., on June 23, 1997.
All capitalized terms used in this Amendment without definition have the
meanings attributed to them in the Schedule 14D-9.
The items of the Schedule 14D-9 set forth below are hereby amended by
adding the following:
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
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<CAPTION>
EXHIBIT
NO. DESCRIPTION
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<S> <C>
55 Published Advertisement of the Company dated September 9, 1997.
56 Mailing to Stockholders of the Company.
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2
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
PENNZOIL COMPANY
Dated: September 8, 1997 By: /s/ James L. Pate
James L. Pate
Chairman of the Board, President
and Chief Executive Officer
3
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EXHIBIT INDEX
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<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
<S> <C>
55 Published Advertisement of the Company dated September 9, 1997.
56 Mailing to Stockholders of the Company.
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EXHIBIT 55
PENNZOIL HAS THE MOST
RECOGNIZED AND
POWERFUL BRAND NAME IN
THE INDUSTRY.
[graphic: Pennzoil sponsored Indy car]
Pennzoil has the most recognized and powerful brand name in the
automotive products industry. Among our achievements:
-- Eleven consecutive years as the number one selling motor oil in the
United States.
-- A 21% share of the U.S. motor oil market.
-- Five consecutive years as the top automotive products "power brand,"
as ranked by Discount Store News.
[graphic: Jiffy Lube logo] [graphic: Pennzoil brand products]
Through its wholly owned subsidiary, Jiffy Lube, Pennzoil also leads
the fast oil change business, the most rapidly growing segment of the U.S.
motor oil market.
Pennzoil has built shareholder value by leveraging this enviable market
position. We are continuing to grow our consumer products businesses by
extending the brand name into new products, adding market share and entering
new high-growth international markets.
These and other initiatives now under way are designed to create
substantial additional value by further strengthening and expanding these
valuable brands.
Pennzoil's marketing operations:
IT'S ALL ABOUT VALUE.
[Pennzoil Logo]
<PAGE> 1
[ON PENNZOIL LETTERHEAD]
September 3, 1997
To Our Shareholders From Pennzoil's Board of Directors
In July, we rejected an unsolicited offer from Union Pacific Resources Group
(UPR) to acquire Pennzoil Company. The reasons for our decision were set forth
in the 14D-9 document subsequently mailed to you. Today, we want to reemphasize
our conviction that the long-term values being created in Pennzoil Company far
exceed the value of this offer. When all is said and done, our decision was all
about value. AND PENNZOIL IS ALL ABOUT VALUE.
Before rejecting the UPR offer, we analyzed it carefully and compared it to the
range of potential values that we expect to achieve under Pennzoil's strategic
plan. From this perspective, our decision was easy. We believe that our
strategic plan can deliver better long-term value to our shareholders and has
far more upside potential than the UPR offer.
Some are quick to call rejections of unsolicited offers "anti-shareholder." In
many cases, that may be true. However, our decision was distinctly
pro-shareholder. As members of the Board of Directors, we are the stewards of
Pennzoil's valuable resources. We know them well and know where the Company is
headed. We are committed to delivering to you the value inherent in Pennzoil
Company.
Shareholders rightfully demand performance that translates into shareholder
value. So do we -- both as directors and shareholders ourselves. Our strategic
plan has been delivering that value since it was implemented in 1995. We also
have the responsibility to ensure that the values being created are realized by
our shareholders, and not prematurely captured at an inadequate price by an
opportunist looking to solve its own future valuation problems.
/s/ James L. Pate /s/ Ernest H. Cockrell /s/ Brent Scowcroft
/s/ Howard H. Baker, Jr. /s/ Harry H. Cullen /s/ Gerald B. Smith
/s/ W. J. Bovaird /s/ Alfonso Fanjul /s/ Cyril Wagner, Jr.
/s/ W.L. Lyons Brown, Jr. /s/ Berdon Lawrence
September 3, 1997: The Wall Street Journal
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This informational series, which was recently printed in The Wall
Street Journal and certain other newspapers, highlights the value inherent in
Pennzoil and elements of its ongoing strategic business plan at this stage in
the company's 108 year history. Each featured business segment easily
distinguishes Pennzoil's operations from UPR.
<PAGE> 3
PENNZOIL HAS BUILT ONE OF
THE BEST INTERNATIONAL OIL
AND GAS PORTFOLIOS OF
ANY INDEPENDENT COMPANY
IN THE INDUSTRY.
[Globe graphic]
Over the past few years, Pennzoil has built one of the best
international oil and gas portfolios of any independent company in the
industry. We have attractive, high potential positions in some of the world's
most prolific oil and gas regions -- including areas that are virtually
impossible to penetrate for latecomers.
Pennzoil is now entering the value creation stage of this program. Our
portfolio includes:
o The giant Azeri-Chirag-Gunashli project in the Caspian Sea, where we
have a 4.8% carried interest in estimated recoverable reserves of at
least 4.7 billion barrels of crude oil.
o A 30% working interest in the nearby Karabakh prospect, also in the
Caspian Sea, which may contain more than 1.0 billion barrels of crude
oil.
o Five prospective concessions in Egypt, covering 9.2 million acres in
hydrocarbon charged basins.
o Three producing blocks in Venezuela, one of the most exciting oil
producing regions in the world.
These and other projects in Pennzoil's worldwide oil and gas portfolio
have the potential to more than double the company's proved reserves and add
significant shareholder value.
Pennzoil's international oil and gas operations:
IT'S ALL ABOUT VALUE.
[Pennzoil Logo]
September 4, 1997: The Wall Street Journal
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PENNZOIL IS ONE OF THE
MOST ACTIVE PLAYERS
IN THE GULF OF MEXICO
Pennzoil is one of the most active drillers in the Gulf of Mexico, the
most attractive area in the United States to explore for and produce crude oil
and natural gas. The Gulf of Mexico accounts for half of Pennzoil's domestic oil
and gas activity.
[graphic; caption: Pennzoil Leasehold Interests in Gulf of Mexico]
With over 150 blocks, Pennzoil has a wealth of operating experience in
the Gulf and retains a leasehold position which forms the basis for creating
tremendous shareholder value. Among Pennzoil's recent successes in this
high-potential area are:
o Garden Banks 161, where Pennzoil and Enterprise Oil have made a
significant crude oil discovery.
o West Cameron 580, with net daily production of over 100 million cubic
feet (MMcf) of natural gas and nearly 5,000 barrels of condensate
from only two wells.
o High Island 140, South Marsh Island 23 and Eugene Island 333 and 316,
where new wells have added, in combination, net daily production of
70 MMcf of natural gas.
Pennzoil is currently developing discoveries in other areas of the Gulf
and is continuing its active exploration program. Pennzoil has a proven track
record of adding reserves in the Gulf.
Pennzoil's Gulf of Mexico properties:
IT'S ALL ABOUT VALUE.
[Pennzoil Logo]
September 5, 1997: The Wall Street Journal
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PENNZOIL'S UNIQUE
DOWNSTREAM BUSINESS CREATES
THE HIGHEST UNIT
PROFITABILITY AMONG ITS PEERS.
[GRAPHIC: EXCEL PARALUBES]
Pennzoil's unique downstream business creates the highest unit
profitability among its peers. Our manufacturing facilities produce the key raw
materials for Pennzoil's consumer products and industrial specialities
businesses.
[GRAPHIC: SHREVEPORT REFINERY] [GRAPHIC: PENNZOIL MOTOR OIL]
The company has recently completed two important projects that will
create substantial shareholder value. They will dramatically reduce production
costs, increase margins and make Pennzoil the second largest lubricating base
oil producer in the United States, ultimately adding an expected $70 million of
annual after-tax cash flow:
o Excel Paralubes, a 50/50 partnership with Conoco, is a
state-of-the-art base oil facility designed to produce 18,000
barrels per day of high quality, low cost base oils.
o The Shreveport refinery upgrade improves Pennzoil's refining
efficiency by increasing throughput nearly 20% and converting
by-products to higher value transportation fuels.
[GRAPHIC: GUMOUT SPECIALTY PRODUCTS]
Pennzoil has a unique, highly profitable downstream business focused on
the low-cost production of base oils and specialty products. The new
manufacturing facilities are just now beginning to contribute to shareholder
value.
Pennzoil's downstream operations:
IT'S ALL ABOUT VALUE.
[PENNZOIL LOGO]
September 8, 1997: The Wall Street Journal
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[PENNZOIL LOGO]
<PAGE> 7
PENNZOIL HAS THE MOST
RECOGNIZED AND
POWERFUL BRAND NAME IN
THE INDUSTRY.
[graphic: Pennzoil sponsored Indy car]
Pennzoil has the most recognized and powerful brand name in the
automotive products industry. Among our achievements:
-- Eleven consecutive years as the number one selling motor oil in the
United States.
-- A 21% share of the U.S. motor oil market.
-- Five consecutive years as the top automotive products "power brand,"
as ranked by Discount Store News.
[graphic: Jiffy Lube logo] [graphic: Pennzoil brand products]
Through its wholly owned subsidiary, Jiffy Lube, Pennzoil also leads
the fast oil change business, the most rapidly growing segment of the U.S.
motor oil market.
Pennzoil has built shareholder value by leveraging this enviable market
position. We are continuing to grow our consumer products businesses by
extending the brand name into new products, adding market share and entering
new high-growth international markets.
These and other initiatives now under way are designed to create
substantial additional value by further strengthening and expanding these
valuable brands.
Pennzoil's marketing operations:
IT'S ALL ABOUT VALUE.
[Pennzoil Logo]
September 9, 1997: The Wall Street Journal
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[PENNZOIL LOGO] Pennzoil Company
Shareowner Services
P.O. Box 2967 * Houston, Texas 77252-2967
-------------------------------------------
Toll-free (888) 795-7862
