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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 28, 2000
Commission File No. 1-12248
KAISER GROUP INTERNATIONAL, INC.
(formerly ICF Kaiser International, Inc.)
(Exact name of registrant as specified in its charter)
Delaware 54-1437073
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9300 Lee Highway, Fairfax, Virginia 22031-1207
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (703) 934-3300
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ITEM 2. DISPOSITION OF ASSETS
Pursuant to its plan to restructure its debt, the Company completed the
sale of the majority of its Engineering Operations during the quarter ended
September 30, 2000 in two separate transactions described below:
. The Infrastructure and Facilities Sale: The Bankruptcy Court approved the
sale of the Infrastructure and Facilities line of business on July 17,
2000. On July 28, 2000, Kaiser completed the sale of its Infrastructure and
Facilities line of business, which provided engineering services to clients
around the world in the transit and transportation, facilities management,
water/wastewater treatment, and microelectronics and clean technology
sectors. In this transaction, substantially all of the assets of this
business were sold to Tyco Group S.A.R.L., the Earth Tech unit of Tyco
International Ltd., for a cash purchase price of $30 million.
. The Metals, Mining and Industry Sale: The Bankruptcy Court approved the
sale of the Metals, Mining and Industry line of business on August 17,
2000. Effective as of August 18, 2000, Kaiser completed the sale of its
Metals, Mining and Industry line of business, which provided engineering
services to clients around the world in the alumina/aluminum, iron and
steel, and mining industry sectors. In this transaction, substantially all
of the assets of this business (not including Kaiser Netherlands, B.V. and
the Nova Hut project) were sold to Hatch Associates, Inc., a subsidiary of
The Hatch Group of Canada, for a cash purchase price of $7.0 million.
Although the Company has not finalized its accounting for the transactions, it
has to date recognized a net loss for financial reporting purposes of
approximately $(0.9) million. After adjusting this loss for items that are not
deductible for federal income tax purposes, such as associated goodwill and
intangible asset write-offs totaling $19.0 million, the transactions resulted in
income tax expense of approximately $8.5 million, resulting in a total
transaction loss, after tax, for financial reporting purposes of approximately
$(9.4) million from the collective sales. The $8.5 million in taxable income
resulting from the sales will be offset by the Company's available net
operating loss carryforwards.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro forma financial information.
See the Index on page 3 for a listing of the pro forma financial
information submitted as part of this Report. For the purposes of such pro
forma information, the two sales described above have been treated as one.
(c) Exhibits
See Index on page 3.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report on Form 8-K to be signed on its behalf
by the undersigned thereunto duly authorized.
KAISER GROUP INTERNATIONAL, INC.
Date: December 12, 2000
/s/ Timothy P. O'Connor
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Timothy P. O'Connor
Executive Vice President, Chief Financial
Officer and Chief Administrative Officer
(Duly authorized officer and principal financial
officer)
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INDEX TO FINANCIAL STATEMENTS AND EXHIBITS
ITEM 7: Page/No.
(b) Pro forma financial statements
(i) Pro Forma Consolidated Condensed Balance Sheet as of
September 30, 2000.......................................... 4
(ii) Pro Forma Consolidated Condensed Statement of Operations
for the nine months ended September 30, 2000 ............... 5
(c) Exhibits
(i) Master Transaction Agreement, dated June 9, 2000, between
TYCO Group S.A.R.L. and Kaiser Group International, Inc. was
filed as Exhibit 10.p and 10.p (i) to the Company's Form
10-Q for the period ended June 30, 2000 and is not included
herein...................................................... --
(ii) Master Transaction Agreement, dated July 6, 2000, between
Hatch Associates, Inc. and Kaiser Group International, Inc.
was filed as Exhibit 10.q. to the Company's Form 10-Q for
the period ended June 30, 2000 and is not included
herein...................................................... --
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Kaiser Group International, Inc.
Debtor-In-Possession
Item 7. (a) (i) Pro Forma Balance Sheet as of September 30, 2000
As the transactions described in Item 2. to this Form 8-K had been completed as
of September 30, 2000, all balance sheet effects of the transaction have been
reflected in the Company's actual balance sheet included in its Form 10-Q for
the nine months ended September 30, 2000. That balance sheet is duplicated below
(amounts in thousands, except shares):
(Unaudited)
Assets
Current Assets
Cash and cash equivalents $42,437
Restricted cash 15,933
Contract receivables, net 22,847
Prepaid expenses and other current assets 1,543
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Total Current Assets 82,760
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Fixed Assets
Furniture, equipment, and leaseholds 3,993
Less depreciation and amortization (3,493)
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500
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Other Assets
Goodwill, net --
Investments in and advances to affiliates 6,368
Notes receivable 6,550
Capitalized software development costs 1,338
Other 3,445
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17,701
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Total Assets $100,961
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Liabilities and Shareholders' Equity (Deficit)
Liabilities Not Subject To Compromise
Current Liabilities
Accounts payable $ 7,282
Accrued salaries and benefits 4,516
Other accrued expenses 6,650
Deferred revenue --
Income taxes payable 542
---
Total Current Liabilities 18,990
Long-term Liabilities
Long-term debt -
Other -
Liabilities Subject To Compromise 159,492
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Total Liabilities 178,482
Commitments and Contingencies
Minority Interest -
Shareholders' Equity (Deficit)
Preferred stock -
Common stock, par value $.01 per share:
Authorized-90,000,000 shares
Issued and outstanding-23,414,328 shares 234
Additional paid-in capital 73,360
Accumulated deficit (151,140)
Accumulated other comprehensive income 25
--
Total Shareholders' Equity (Deficit) (77,521)
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Total Liabilities and Shareholders' Equity (Deficit) $100,961
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Kaiser Group International, Inc.
Debtor-In-Possession
Item 7. (a) (ii) Pro Forma Statement of Operations for the Nine Months Ended
September 30, 2000:
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Actual Results Pro Forma Adjustments Pro Forma Results
(See Notes)
<S> <C> <C> <C>
Gross Revenue $ 271,385 $ - $ 271,385
Subcontract and direct material costs (195,367) - (195,367)
Equity in net income of unconsolidated subsidiaries 2,621 - 2,621
------------- ------------ ------------
Service Revenue 78,639 - 78,639
Operating Expenses
Direct labor and fringe benefits 63,426 - 63,426
Selling, general and administrative 6,389 (3,000) 4) 3,389
Depreciation and amortization 2,467 (2,467) 3) -
Restructuring charges 4,377 - 5) 4,377
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Operating Income (Loss) 1,980 5,467 7,447
Other Income (Expense)
Interest income 1,966 1,200 2),5) 3,166
Interest expense (8,445) - 5) (8,445)
------------- ------------ ------------
Income (Loss) From Continuing Operations
Before Income Taxes, Minority Interest and (4,499) 6,667 2,168
Extraordinary Item
Income tax (expense) benefit 8,420 - 5) 8,420
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Income (Loss) From Continuing Operations 3,921 6,667 10,588
Before Minority Interest and Extraordinary Item
Minority interest in net income of subsidiaries (5,999) - (5,999)
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Income (Loss) Before Discontinued Operations, (2,078) 6,667 4,589
and Extraordinary Item
Income (loss) from discontinued operations, net of tax 1,089 (1,089) 1) -
Gain (loss) on sale of discontinued operations, net of tax (9,435) - (9,435)
------------- ------------ ------------
Income (Loss) before Extraordinary Item (10,424) 5,578 (4,846)
Extraordinary item, net of tax (35) - 5) (35)
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Net Income (Loss) $ (10,459) $ 5,578 $ (4,881)
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Basic and Diluted Earnings (Loss) Per Share:
Continuing operations, net of tax $ (0.09) $ 0.29 $ 0.20
Discontinued operations, net of tax (0.36) (0.05) (0.41)
Extraordinary item, net of tax (0.00) - (0.00)
------------- ------------ ------------
$ (0.45) $ 0.25 $ (0.21)
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Weighted average shares for basic and diluted earnings per share 23,270 23,270 23,270
============= ============ ============
</TABLE>
Notes:
1) To eliminate the income from the discontinued Engineering Operations, net
of tax in order to depict the transactions described in Item 2. Of this
report as though they had been consummated as of January 1, 2000.
2) To increase interest income based on the assumption that the sale proceeds
totalling $37.0 million would have been invested as of January 1, 2000.
3) To reduced amortization expense for the assumption write-off of related
goodwill and intangibles as though the transactions were consummated as of
January 1, 2000.
4) To reduce the amount of selling, general and administrative expense
assuming that downsizing of corporate staff and activities had taken effect
as of January 1, 2000 rather than after the completion of the sales.
5) No adjustments have been reflected hereon to give effect to the
consummation of the Company's Plan of Reorganization currently pending
before the United States Bankruptcy Court in the District of Delaware.
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