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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-1
(Amendment No. 28)
Tender Offer Statement
Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934
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Pennzoil Company
(Name of Subject Company)
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Union Pacific Resources Group Inc.
Resources Newco, Inc.
(Bidders)
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Common Stock, par value $0.83 1/3 per Share
(Including the Associated Preferred Stock Purchase Rights)
(Title of Class of Securities)
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709903 10 8
(CUSIP Number of Class of Securities)
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Joseph A. LaSala, Jr., Esq.
Vice President, General Counsel and Secretary
Union Pacific Resources Group Inc.
801 Cherry Street
Fort Worth, Texas 76102
Telephone: (817) 877-6000
(Name, Address and Telephone Number of Persons
Authorized to Receive Notices and Communications on Behalf of Bidders)
Copies To:
Howard L. Shecter, Esq. Paul T. Schnell, Esq.
Morgan, Lewis & Bockius LLP Skadden, Arps, Slate, Meagher & Flom LLP
101 Park Avenue 919 Third Avenue
New York, NY 10178-0060 New York, NY 10022-3897
Telephone: (212) 309-6384 Telephone: (212) 735-3000
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<PAGE>
This Amendment No. 28 amends the Tender Offer Statement on Schedule
14D-1 filed on June 23, 1997 (the 'Schedule 14D-1') by Union Pacific Resources
Group Inc., a Utah corporation ('UPR'), and Resources Newco, Inc., a Delaware
corporation and a wholly owned subsidiary of UPR (the 'Purchaser', and together
with UPR, the 'Bidders'), with respect to Purchaser's offer to purchase all
shares of Common Stock, par value $0.83 1/3 per share (the 'Shares'), of
Pennzoil Company, a Delaware corporation ('Pennzoil'), together with the
associated Preferred Stock Purchase Rights, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated June 23, 1997 (the 'Offer
to Purchase'), the Supplement to the Offer to Purchase, dated October 7, 1997
(the 'Supplement'), and the related revised Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
'Offer'), which were filed as Exhibits (a)(1), (a)(26) and (a)(27) to the
Schedule 14D-1, respectively. Unless otherwise defined herein, all capitalized
terms used herein shall have the respective meanings given such terms in the
Offer to Purchase or in the Supplement.
Item 3. Past Contacts, Transactions or Negotiations with the Subject Company.
Item 3 is hereby amended to add the following:
On October 8, 1997, Mr. Jack L. Messman sent to each member of
the Board of Directors of Pennzoil a letter in the form
attached to this Schedule 14D-1 as Exhibit (g)(19), which
is incorporated by reference herein.
Item 11. Material to be Filed as Exhibits.
Item 11 is hereby amended to add the following:
(a)(36) Message to Pennzoil Shareholders, published October 8, 1997
and October 9, 1997.
(g)(19) Form of letter, dated October 8, 1997, to each member of the
Board of Directors of Pennzoil.
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SIGNATURES
After due inquiry and to the best of our knowledge and belief, we
certify that the information set forth in this statement is true, complete and
correct.
UNION PACIFIC RESOURCES GROUP INC.
By: /s/ JOSEPH A. LASALA, JR.
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Name: Joseph A. LaSala, Jr.
Title: Vice President, General Counsel
and Secretary
RESOURCES NEWCO, INC.
By: /s/ JOSEPH A. LASALA, JR.
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Name: Joseph A. LaSala, Jr.
Title: Vice President, General Counsel
and Secretary
Dated: October 9, 1997
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page No.
- ---------- ----------- --------
(a)(36) Message to Pennzoil Shareholders, published October 8, 1997 and
October 9, 1997.
(g)(19) Form of letter, dated October 8, 1997, to each member of the
Board of Directors of Pennzoil.
PENNZOIL SHAREHOLDERS:
UPR GOES ALL CASH
FOR ALL SHARES.
You Deserve the Opportunity to Choose:
$84 per share
ALL CASH. ALL SHARES. NOW.
PLUS
Potential upside value of Pennzoil's
international E&P assets, if Pennzoil negotiates.
OR
???
The hope that . . . someday . . . Pennzoil's still
undisclosed strategic plan might deliver more
value, despite seven years of poor performance.
Send a message to Pennzoil:
o Tender your shares to UPR.
o Contact Pennzoil Directors now and tell
them to begin negotiations with UPR.
[UPR LOGO]
This advertisement is not an offer to puchase shares of Pennzoil, nor is it an
offer to sell any securities which may be issued in a merger involving Pennzoil
and a subsidiary of UPR. The cash tender offer by a subsidiary of UPR to acquire
all of Pennzoil's common shares will be made solely by the Offer to Purchase,
the Supplement thereto and the related Letter of Transmittal. Any issuance of
securities in any merger involving Pennzoil and a subsidiary of UPR would have
to be registered under the Securities Act of 1933, as amended, and such
securities would be offered only by means of a prospectus complying with such
Act.
[UPR LOGO]
Jack L. Messman
Chairman & CEO
October 8, 1997
[Pennzoil Director]
[Address]
Dear [Pennzoil Director]:
We believe our revised proposal resolves the concerns Pennzoil has
expressed regarding our previous offer. As evidenced by the attached
commentary, the independent investment community agrees.
I want to make sure that you are fully aware that our proposal includes our
willingness to work with Pennzoil to structure a transaction with a special
feature involving Pennzoil's international exploration and production assets.
This feature would provide real value to Pennzoil shareholders in excess of
$84 per share, if these assets are worth more than $600 million. We believe
there are transaction structures involving Pennzoil's international E & P
assets which are both fair to UPR shareholders and could provide all, or
substantially all, of this potential upside value to Pennzoil shareholders.
Our preference is, and always has been, to negotiate a transaction with
Pennzoil. We stand ready to begin constructive negotiations at any time.
Sincerely,
/s/ Jack
Jack L. Messman
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ANALYST COMMENTARY ON UPR'S
ALL CASH OFFER FOR PENNZOIL
"I just do not think the Pennzoil Board can ignore shareholder rights."
Michael Young, DMG
Reuter, 10/6/97
"I think 84 bucks, all cash for the company, especially if you're willing to
carve out those international properties . . . I think it's a hell of a deal. I
don't know how Pennzoil turns it down."
Arthur W. Tower, Howard, Weil
Houston Chronicle, 10/7/97
"Union Pacific Resources ups the ante for Pennzoil in the form of an all cash
bid."
Ellen Hannan, Prudential Securities
First Call, 10/7/97
"The latest offer from UPR addresses almost all of Pennzoil's arguments."
Michael Barbis, UBS
Reuter, 10/6/97
"Never has PZL specifically stated how to achieve the shareholder value offered
by UPR."
John Herrlin, Merrill Lynch
First Call, 10/7/97
"We think that UPR will ultimately prevail."
Tom Driscoll, Salomon Brothers
First Call, 10/7/97
"The more we have looked at the deal, the more optimistic we have become in the
intermediate and longer-term prospects for the resulting enterprise . . . The
basics of the deal continue to make perfect sense to us and are representative
of forward-looking thinking on the part of the UP Resources team."
David Bradshaw, DLJ
First Call, 10/7/97
<PAGE>
"In addition, UPR has taken an interesting approach in its bid for Pennzoil by
offering to discuss a contingent value, or upside, to Pennzoil's international
oil and gas assets above UPR's assessed value of $600 million. It is entirely
appropriate, in our view, that UPR place a contingent value on Pennzoil's
international assets as that is where the greatest difference in perceived value
exists. The details of any contingent value are completely open to discussions
between UPR and Pennzoil managements. UPR described the added value feature by
saying that the concept was more important than the exact structure.
"UPR is in essence willing to discuss a higher price for certain of the
company's assets, if Pennzoil management can show that such assets do in fact
hold higher value. This added feature may prove to be the catalyst to begin
negotiations between the two companies.
"Realistically, there is no sound reason for UPR and Pennzoil not to enter
discussions on valuation. Pushing aside the assertions both companies have been
making in their media campaign to shareholders, the bottom-line issue is WHAT IS
THE PRESENT VALUE of Pennzoil's assets? . . . it is unlikely, in our view, that
Pennzoil shareholders will allow their company's board to avoid discussing the
issue with UPR, if for no other reason than it deprives such shareholders of
their rights."
Michael Young, DMG
First Call, 10/7/97
"It puts more pressure on the Pennzoil board to come to the table . . . this was
a stock that was trading at 59 1/2 before the Union Pacific announcement.
Eighty-four (dollars per share) represents a significant premium."
Tom Burnett, Merger Insight
Houston Chronicle, 10/7/97
"This revised offer mutes much, if not all, of Pennzoil's criticism of the UPR
offer. Since the offer is now 100% in cash, the value of UPR's stock is
immaterial. In addition, PZL can no longer accuse UPR of undervaluing its assets
following its offer to create a special security tied to the value of the
international exploration assets. . .
"It will be much more difficult for Pennzoil to contest UPR's revised offer. In
addition, a largely new shareholder base (30.4 million shares or 64% of those
outstanding have traded since UPR's original offer) could make it tougher for
Pennzoil's board to stick with its 'Just say no' defense . . . the ball is now
in PZL's court . . . the acquisition is dilutive to earnings but, more
importantly, it is additive to cash flow. While leverage will increase
substantially, we believe the strategic fit more than makes up for this."
Michael Barbis, UBS
First Call, 10/7/97
<PAGE>
"[An all-cash bid] probably increases the chances that UPR can complete the
merger. This shrinks the wiggle room for Pate in addressing his shareholders."
David Garcia, Principal Financial Securities
Fort Worth Star-Telegram, 10/7/97
"By offering $84 in cash per each PZL share, and an equity option kicker, in the
event of a negotiated transaction with PZL, UPR has put money on the barrel to
elicit a response from PZL that focuses on net present value vs. verbiage on
long-term strategy. The degree of rhetoric between the two companies has been
high . . . Obviously, UPR would like to still negotiate with PZL, and the all
cash approach might act as a catalyst to get PZL to come to terms. Should PZL
remain truculent in its response, the shareholder tender (due 11/5/97) might
become a more important event in PZL's decision-making process."
John Herrlin, Merrill Lynch
First Call, 10/7/97
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