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) June 22, 1995
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NEW ENGLAND INVESTMENT COMPANIES, L.P.
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(Exact name of Registrant as specified in its charter)
Delaware 1-9468 13-3405992
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
399 Boylston Street, Boston, Massachusetts 02116
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 617) 578-3500
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Item 5. Other Events
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New England Investment Companies, L.P. (NEIC) signed an agreement
on June 22, 1995 to acquire the assets and certain liabilities
of Harris Associates, L.P. (Harris), a Chicago-based investment
management company with more than $6 billion in assets under
management.
Founded in 1976, Harris is the investment advisor for the $3
billion Oakmark Fund Group. It also has developed highly
successful institutional, private client and multi-manager
product lines that have grown to approximately $3 billion in
assets under management. Harris has annual revenues of
approximately $60 million. The current management team at Harris
will continue to operate out of its Chicago office and will
retain its investment independence. Harris is currently a
privately held partnership.
Under the agreement, NEIC will purchase the assets and certain
liabilities of Harris for $175 million at the closing, payable in
a combination of cash and newly issued L.P.units, the proportions
to be determined under an election formula. Such election will
be made by the partners of Harris upon completion of the
transaction. The entire purchase price may be paid in cash,
depending upon the election of the Harris partners at that time,
and is expected to be funded by a combination of bank and
privately placed long term debt financing. For purposes of the
election, the L.P. units will be valued at the average of $16 and
a unit price which is the average market value of the units for
20 consecutive trading days beginning on July 22, 1995, provided
that the value will be no less than $16 and no more than $19.
NEIC will make an additional payment in early 1997, also in cash
and units pursuant to a further election by the partners of
Harris, as a purchase price adjustment based upon the performance
of Harris' business in 1996. The additional payment is expected
to be $37 million based on projected 1995 revenues which are the
measuring point for the additional payment. For purposes of the
1997 election, the L.P. units will be valued at the average
market value of the units for the first 20 trading days of 1997.
The acquisition will be accounted for under the purchase method
of accounting and will result in the recording of approximately
all of the consideration as intangible assets for financial
reporting purposes. The purchase price is based on a multiple of
8.75 times the share of cash flow of Harris which will accrue to
NEIC. NEIC's share of cash flow will be a percentage of revenues
earned by Harris without deduction for expenses. The closing
of the transaction is subject to the fulfillment of certain
conditions including the approval of the shareholders of the
mutual funds advised by Harris.
Item 7. Financial Statements and Exhibits
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Press release dated June 23, 1995.
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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 thereunto duly authorized.
New England Investment Companies, L.P.
Date: June 23, 1995 By: G. Neal Ryland
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G. Neal Ryland
Executive Vice President,
Chief Financial Officer and
Chief Accounting Officer
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NEWS RELEASE
FOR IMMEDIATE RELEASE
Contact: Laurence J. Dwyer 617/578-1686
Margaret-Ellen Clough 617/578-1884
BOSTON (June 23, 1995) -- New England Investment Companies, L.P. (NYSE:
NEW) announced today that it has signed an agreement to acquire the assets of
Harris Associates L.P., a Chicago-based investment management company with more
than $6.5 billion in assets under management. Following the completion of the
acquisition, New England Investment Companies will have more than $70 billion in
assets under management, making it the fourth largest publicly traded investment
management firm in America.
Founded in 1976, Harris Associates is the investment advisor for the $3.2
billion Oakmark Fund Group, which includes the $2.3 billion Oakmark Fund, the
top-ranked growth mutual fund for the three years ended March 31, 1995. It also
has developed highly successful institutional, private client and multi-manager
product lines that have grown to approximately $3.3 billion in assets under
management. The current management team of Harris Associates will continue to
operate out of the Chicago office and will retain its investment independence.
"Harris Associates has achieved strong growth during its 20-year history,
particularly during the last four years when it nearly tripled its assets under
management," said Peter S. Voss, chairman and chief executive officer of New
England Investment Companies. "The combination should produce great long term
value to our unitholders by adding to our operating cash flow, which is the
determining factor in our distribution policy."
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"Harris Associates' growth reflects the excellent investment performance of
its equity portfolios and will increase our presence in the equity market. The
Harris team's consistent implementation of its bottom-up, value investment style
has produced an outstanding long term track record that consistently outperforms
its benchmark indices and will be a valuable addition to our already strong
group of investment management subsidiaries and affiliates," Voss added.
"The Harris team is committed to developing a strong relationship with New
England Investment Companies," said Victor A. Morgenstern, president and chief
executive officer of Harris. "New England Investment Companies' commitment to
the independence and culture of its operating units will enable us to build upon
the success we have achieved during the last several years. My partners and I
are also excited about our access to its marketing and distribution resources
which will help us to broaden our product lines and enhance our ability to
attract new assets."
New England Investment Companies is a limited partnership with more than
$65 billion in assets under management made up of eleven subsidiaries, divisions
and affiliates offering a wide array of investment styles and products to
institutional and individual clients. Its business units include Back Bay
Advisors; Copley Real Estate Advisors; Draycott Partners; Loomis, Sayles & Co.;
Marlborough Capital Advisors; New England Funds; New England Investment
Associates; Reich & Tang Capital Management; Reich & Tang Mutual Funds Group;
Westpeak Investment Advisors; and New England Investment Companies' affiliate,
Capital Growth Management.
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