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Filed by Komag, Incorporated
Pursuant to Rule 425 under the
Securities Act of 1933, and
deemed filed Pursuant to Rule
14a-12 under the Securities
and Exchange Act of 1934.
Subject Company:
HMT Technology Corp.
Commission File No. 000-27586
KOMAG, INCORPORATED
CONFERENCE CALL CONCERNING TRANSACTION INVOLVING
KOMAG, INCORPORATED AND HMT TECHNOLOGY CORP.
TH Tan Good morning. Thank you for joining us at this early hour. I
am TH Tan, president and CEO of Komag, Incorporated.
Ron Buschur And I am Ron Buschur, president and COO of HMT.
Ted Siegler This is Ted Siegler, Komag's CFO. I'd like to read a cautionary
note regarding forward-looking statements
The following remarks will contain forward-looking statements
within the meaning of the Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995. These statements
regarding, among other things, the expected cost structure and
cash flow of the combined company, represent the companies'
reasonable judgments with respect to future events and are
subject to risks and uncertainties that could cause actual
results to differ materially. Such factors include, but are not
limited to, failure of the transaction to close due to lender,
shareholder or regulatory approvals, the risk that Komag and HMT
will not successfully integrate their businesses or that the cost
of such integration will be greater than anticipated, failure of
the company to retain and hire key executives, technical
personnel and other employees, material adverse changes in
economic and competitive conditions in the markets served by the
companies, material adverse changes in the business and financial
condition of either or both companies and their customers,
uncertainties concerning technological changes and future product
performance, and substantial delay in the expected closing of the
transaction.
TH Tan Thank you Ted. This is T.H. Tan again.
As announced in our joint press release that went onto the wires
at 11:00 a.m. PDT yesterday, our two companies have signed a
definitive agreement to merge. The boards of each company
unanimously approved the terms of the agreement. Specifically,
each share of HMT stock will be converted to 0.9094 shares of
Komag stock upon finalizing the merger. The merger is intended as
a tax-free transaction to be accounted for under purchase
accounting. The transaction is subject to regulatory approvals,
approval of each company's stockholders, and of Komag's lenders.
We expect to finalize the transaction in the third quarter of
this year.
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TH Tan There are many reasons that the merger is important for our
companies. I will discuss several of these reasons that were
particularly important in our decision process.
- Our industry is intensely competitive. The first condition
necessary to success is technology. Ron will discuss the
technology advantages our combined company will possess. I
would like to focus on some of the other criteria for
success.
- First, low cost is critical to success as a media
manufacturer. Komag has diligently changed its cost
structure. The success of our effort thus far was apparent
in our first quarter results, announced last week. However,
the path to profitability requires higher sales volume to
spread fixed manufacturing costs over more units and to
create greater dollar gross margins to help pay for
continued investment in new technology and the plant and
equipment necessary for future manufacturing. This merger
will increase the scale of our company by adding
substantially all of our two companies' production capacity
together. In combination with our low cost Malaysian
manufacturing we believe this scale will help us achieve
lower costs than either company can achieve on its own.
- Next, no company will be successful without a team of
strong people. We have encountered HMT over many years. We
respect the capability to deliver positive results that HMT
has demonstrated over the years. One of the tremendous
opportunities we have as we merge is to take advantage of
the most talented people in both companies so that the
whole will be stronger than the sum of the parts.
- Finally, we will have the broadest customer base in the
industry. The increased breadth of our customer base will
make us less dependent on any one customer and should
enable us to manage our product development and our
manufacturing operations in a more efficient manner. We
will have more significant resources and expertise to apply
to more customer opportunities, which will benefit us as we
strive to provide superior solutions for the industry's
future needs.
TH Tan Now I'd like to turn the call over to Ron Buschur to give you
his perspective on our prospective merger.
Ron Buschur Thanks TH.
- We believe that combining the best of the manufacturing
expertise, quality systems and technological capabilities
from both our companies will provide our customers with the
leading edge products that will help them be successful in
this very competitive marketplace. The new company will be
positioned to be the pre-eminent independent media
manufacturer.
- Today both companies participate in many customer
qualifications. The cost of each qualification is high,
consuming materials, equipment
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capacity and engineering time and resources for us and
similar costs for our customers. The new company should be
able to help our customers reduce the number of
qualification runs, saving significant cost for both us and
more importantly, our customers.
- Both TH and I have contacted our customers directly. I can
tell you that the conversations went very well. Our
customers appear to be very supportive of this merger
because they believe the combined company will be much
stronger and capable of advancing the technologies forward
in the future.
Ron Buschur As you can tell we are enthusiastic about the prospect of this
merger. We all believe that there is a lot more value in the
combination of our companies than if we stand alone. Thank you
for your attendance at this early hour. With that I'd like to
turn the call over to _______________ for the question and
answers.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of the
Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.
These statements regarding, among other things, the expected cost structure and
cash flow of the combined company, represent the companies' reasonable judgments
with respect to future events and are subject to risks and uncertainties that
could cause actual results to differ materially. Such factors include, but are
not limited to, failure of the transaction to close due to regulatory or lender,
shareholder or regulatory approvals, the risk that Komag and HMT will not
successfully integrate their businesses or that the cost of such integration
will be greater than anticipated, failure of the combined company to retain and
hire key executives, technical personnel and other employees, material adverse
changes in economic and competitive conditions in the markets served by the
companies, material adverse changes in the business and financial condition of
either or both companies and their customers, uncertainties concerning
technological changes and future product performance, and substantial delay in
the expected closing of the transaction.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
Investors and security holders of both HMT and Komag are advised to read the
joint proxy statement/prospectus regarding the business transaction referenced
in the foregoing information, when it becomes available, because it will contain
important information. HMT and Komag expect to mail a joint proxy
statement/prospectus about the transaction to their respective stockholders.
Such joint proxy statement/prospectus will be filed with the Securities and
Exchange Commission by both companies. Investors and security holders may obtain
a free copy of the joint proxy statement/prospectus (when available) and other
documents filed by the companies at the Securities and Exchange Commission's web
site at http://www.sec.gov. The joint proxy statement/prospectus and such other
documents may also be obtained from HMT or Komag by directing such requests to
the respective investor relations contacts listed below.
HMT and its officers and directors may be deemed to be participants in the
solicitation of proxies from HMT 's stockholders with respect to the proposed
transaction. Information regarding such officers and directors is included in
HMT's proxy statement for its annual meeting of stockholders filed with the
Securities and Exchange Commission on June 28, 1999. This document is available
free of charge at the Securities and Exchange Commission's web site at
http://www.sec.gov and from the HMT investor relations' contacts listed below.
Komag and its officers and directors may be deemed to be participants in the
solicitation of proxies from Komag's stockholders with respect to the proposed
transaction. Information regarding such officers and directors is included in
Komag's proxy statement for its annual meeting of stockholders filed with the
Securities and Exchange Commission on April 10, 2000. This document is available
free of charge at the Securities and Exchange Commission's Web site at
http://www.sec.gov and from the Komag investor relations' contacts listed below.
Contacts:
For Komag:
Ted Siegler at (408) 576-2209 or
Russell Lemelin at (408) 576-2485
E-mail communications: [email protected]
For HMT:
Peter Norris, (510) 490-3100
Investor Relations, (510) 683-6000