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UNITED STATES
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 19, 1998
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PICO HOLDINGS, INC.
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(Exact name of registrant as specified in charter)
California 0-18786 94-2723335
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
875 Prospect Street, Suite 301, La Jolla, California 92037
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (619) 456-6022
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On June 19, 1998, PICO Holdings, Inc. publicly announced that its
proposal was favorably received by the independent committee of Global
Equity Corporation's Board of Directors, relative to the previously
disclosed business combination of PICO Holdings, Inc. ("PICO") and
Global Equity Corporation ("GEC"). Under the terms of the proposed
business combination, each GEC shareholder, other than PICO, would
exchange their shares for common stock of PICO on the basis of 0.4628
of a PICO share for each GEC share.
The independent committee is prepared to recommend acceptance of the
proposal to GEC shareholders subject to receiving the formal written
opinion of First Marathon Securities Limited, its independent financial
advisor.
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SIGNATURE
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.
PICO HOLDINGS, INC.
Date: July 21, 1998 By: /s/ Gary W. Burchfield
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Gary W. Burchfield
Chief Financial Officer and Treasurer
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EXHIBITS INDEX
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Exhibit Number Description
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99. June 19, 1998 Joint Press Release between PICO Holdings, Inc.
and Global Equity Corporation.
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EXHIBIT 99.
NEWS RELEASE
FOR IMMEDIATE RELEASE
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PICO HOLDINGS, INC.
AND
GLOBAL EQUITY CORPORATION
JOINT PRESS RELEASE
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(LA JOLLA, CALIFORNIA - TORONTO, CANADA)--JUNE 19, 1998--PICO Holdings,
Inc. of La Jolla, California and Global Equity Corporation of Toronto, Ontario,
today announced that their previously disclosed discussions concerning a
potential combination of the two companies have resulted in a proposal by PICO
Holdings (which today beneficially owns, together with its affiliates,
approximately 51% of Global Equity's common shares). This proposal was favorably
received by the independent committee of Global Equity's board of directors.
Under the terms of the proposed business combination, current Global Equity
shareholders, including PICO Holdings' affiliates, would exchange their shares
for common stock of PICO Holdings on the basis of 0.4628 of a PICO share for
each Global Equity share. The independent committee is prepared to recommend
acceptance of the proposal to Global Equity shareholders subject to receiving
the formal written opinion of First Marathon Securities Limited, its independent
financial adviser. First Marathon expects to complete and deliver its formal
valuation within the next several weeks and has indicated it expects to be able
to deliver an opinion that the exchange ratio is fair, from a financial point of
view, to the shareholders of Global Equity other than PICO Holdings.
The proposed exchange ratio was calculated based on net asset values of
Cdn. $3.83 per share for Global Equity and US $5.61 per share for PICO Holdings.
Based on these net asset values, the transaction to acquire the approximate 49%
minority of common stock of Global Equity is valued at approximately US $103.8
million or Cdn. $153 million.
The combination of PICO Holdings and Global Equity would simplify the
two companies' organizational structures and present shareholders with a more
liquid stock in a larger public company listed on the Nasdaq National Market
System. The simplification and increase in size and liquidity of the combined
companies should encourage increased analyst coverage and institutional
investment interest as well as provide increased access to capital markets.
The share exchange would be effected by way of an arrangement under
Ontario corporate law, implementation of which would be subject to approval by
the shareholders of both companies (on a majority of minority basis for Global
Equity) and court approval. It is anticipated that proxy materials would be sent
to the shareholders of both companies in early August 1998, with shareholder
meetings to approve the transaction expected to occur in September 1998. In
addition to the shareholder and other approvals described above, the transaction
would be subject to customary conditions such as regulatory approvals (including
SEC registration of the PICO Holdings shares to be issued under the proposed
share exchange) and delivery of First Marathon's fairness opinion.
Global Equity Corporation is an international investment company with
offices in Toronto, Canada and La Jolla, California. Its stock trades on the
Toronto and Montreal Stock Exchanges under the symbol "GEQ". PICO Holdings, Inc.
is a diversified insurance and investment holding company, headquartered in La
Jolla, which trades under the symbol "PICO" on the Nasdaq National Market
System.
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This Joint Press Release is not an offer of securities by PICO
Holdings, Inc. Any such offer will be made only by means of a prospectus
complying with applicable United States and Canadian securities requirements.
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For further information, please contact:
Global Equity Corporation PICO Holdings, Inc.
Max Webb Richard H. Sharpe
(619) 551-6835 (Ext. 216) (619) 456-6022 (Ext. 201)
First Marathon Securities Limited Special Committee of Global Equity
Marianne Anderson Corporation, Board of Directors
(416) 869-7458 David Williams
(416) 364-4700
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