<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 [Amendment No. ______]
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
SAFETY-KLEEN CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
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[_] Fee previously paid with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
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(1) Amount Previously Paid:_______________________________________________
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<PAGE>
The following are definitive additional materials of Safety-Kleen Corp.:
SAFETY-KLEEN IS CONVINCED LLE CANNOT
ACHIEVE ITS PROJECTED SYNERGIES-
The following slides contain statements of the opinion and beliefs of SK
concerning various matters relating to the ability to achieve synergies in a
combination of SK and LLE as follows:
. Off-site Hazardous Waste Management Business is Declining
. Safety-Kleen and LLE - Not Synergistic Businesses
. LLE/ Rollins "Synergies" are Not Replicable in an SK/LLE Combination
. LLE's Waste Internalization Program is not Feasible
. SK Believes: LLE Service Center Proposals Would Reduce Gross Profit
. Further People Cuts Would Lose Business
OFF-SITE HAZARDOUS WASTE MANAGEMENT
BUSINESS IS DECLINING
HAZARDOUS WASTE MANAGED OFFSITE:
TRENDS
[Line graph depicting volumes of hazardous waste managed offsite using the 1989
volume as the basis (100%)
<TABLE>
<CAPTION>
<S> <C>
1989 100% 1993 142%
1990 120% 1994 135%
1991 140% 1995 130%
1992 150% 1996 123%
</TABLE>
Source-Farkas-Berkowitz]
. Market Shrink 5% per Year 1993-1996 (Farkas-Berkowitz)
. We believe the start up of Marine Shale's facility will result in
substantial additional capacity and add significant competitive pressure
OFF-SITE HAZARDOUS WASTE MANAGEMENT
BUSINESS IS DECLINING
[Subtitle C Hazardous Waste Landfill
Disposal Volumes Graph Showing Volumes
for years 1989-1996
<TABLE>
<CAPTION>
Source EI Digest
<S> <C> <C> <C>
1989 3,263,000 cu yds 1993 3,514,000 cu yds
1990 3,373,000 cu yds 1994 3,639,000 cu yds
1991 3,350,000 cu yds 1995 2,703,000 cu yds
1992 3,481,000 cu yds 1996 2,629,000 cu yds]
</TABLE>
OFF-SITE HAZARDOUS WASTE MANAGEMENT
BUSINESS IS DECLINING
LLE'S LIABILITIES
-----------------
. Government Required Closure/Post Closure Care
(financial assurance): $450 Million
--includes Pinewood, S.C.: $140 Million
(only 1 of 8 LLE hazardous waste landfills)
. Projected Expenditures: $280 Million
. Current Reserve: $183.1 Million
. Financial assurance is provided by Laidlaw, Inc. Will they Continue to do
so?
<PAGE>
OFF-SITE HAZARDOUS WASTE MANAGEMENT
BUSINESS IS DECLINING
The hazardous waste disposal industry continues to show signs of declining
profitability and asset values.
. Waste Management last week announced $3.5 billion of special charges --
including $2.9 billion of asset revaluation adjustments -- reducing
shareholders' equity by more than 70%.
. $0.9 billion of the total charge related to its chemical and hazardous waste
business.
. The asset revaluations in the hazardous waste business related primarily to
recognizing the impaired value of its thermal, land disposal and fuels
recycling facilities.
. WMX's chairman also announced they expect "declines in hazardous waste
revenues" in their 1998 outlook.
SAFETY KLEEN AND LLE
NOT SYNERGISTIC BUSINESSES
S-K INDUSTRIAL CUSTOMER SERVICE NEEDS
[Graphical representation of Safety-Kleen industrial customer needs survey
performed mid-1997.
5,197 service needs were identified including parts cleaning, PCB's vacuum
services, empty drum service, oil services, toxic metals, acids, bases, etc.
Totals were categorized as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
- -- Recycle/Reuse Services 3,368 65%
- -- Compliance and Testing Services 745 14%
- -- Onsite and Closed Loop Services 928 18%
- -- Chemical Neutralization 89 2%
- -- Landfill Incineration 67 1%]
</TABLE>
SAFETY KLEEN AND LLE
NOT SYNERGISTIC BUSINESSES
[Graphical representation of Safety-Kleen industrial customer waste service
revenues from 1989-1997 in millions of dollars and separated by the following
waste services categories.]
<TABLE>
<CAPTION>
1989 1991 1993 1995 1997
<S> <C> <C> <C> <C> <C>
Waste Fuel $14.30 $20.40 $ 56.20 $ 69.80 $ 75.40
Incineration $ 1.00 $10.50 $ 7.10 $ 5.60 $ 3.40
Water $ 0.60 $ 2.80 $ 8.80 $ 13.30 $ 14.60
Absorbent $ 0.00 $ 0.70 $ 3.00 $ 5.90 $ 10.80
Other Serv $ 0.00 $ 0.00 $ 0.50 $ 1.70 $ 7.80
Tech Serv $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 12.30
Parts Clean $40.00 $97.10 $118.00 $119.00 $137.00
</TABLE>
<PAGE>
LLE/ROLLINS "SYNERGIES" ARE NOT
REPLICABLE IN AN SK/LLE COMBINATION
. Rollins was in the same business as LLE with only 3,600 customers to support.
Rollins was a company with $240 million in fiscal 1996 revenues and over $63
million in net losses in the 3-1/4 years prior to December 31, 1996.
. Rollins already had transitioned 2 incinerators out of normal service prior
to the merger due to under-utilization. L.L.E.'s Clive incinerator was
operating at 29% of capacity and incurred $5 million of operating losses in
the first half of 1997. It sat within a few miles of Rollins' Aragonite
facility. These large fixed assets were easily made redundant.
. L.L.E. recorded asset writedowns and reserves totaling approximately $0.5
billion in the merger, including $0.3 billion to writedown their own
facilities.
. This "accounting event" has enabled L.L.E. to reduce (non-cash) depreciation
and amortization expense by approximately $38 million annually -- which
represents approximately 40% of their reported $90 million in annual Rollins
"synergies".
. We believe L.L.E. has exhausted its opportunities for writedowns of its
assets to benefit earnings.
LLE'S WASTE INTERNALIZATION PROGRAM
IS NOT FEASIBLE
Technical Limitations of Commercial
Incinerators
. Incinerators Limited to a Maximum Thermal Input
-- Design and Permit Limits on Total Heat Input (Btu/hr)
-- High Energy Value Waste Streams Displace Available
Capacity to Burn Low Energy Bearing Waste Streams
. Our review concludes that internalization of Safety-Kleen
Waste Volumes into Laidlaw is Clearly Not Practical
-- S-K Waste Volumes Could Represent all of Laidlaw's
Practical U.S. Capacity unless LLE reopens facilities they
stated are/will be closed.
. We Believe Cement Kilns Provide a Significant
Savings in Disposal Costs Compared to Incinerators:
-- We believe S-K Disposal Costs for Bulk Liquids and
Solids Are Less Than Incinerator Variable Costs
. Laidlaw Continues the Practice of Sending Blended
Wastes as Fuel to Cement Kilns (including Holnam/S-K)
LLE'S WASTE INTERNALIZATION PROGRAM
IS NOT FEASIBLE
74% of Safety-Kleen's Waste is Recycled and
Less than 2% is Incinerated
[Graphical representation of Safety-Kleen's Waste Volumes by disposal methods.
The four methods of disposal and the percentages are listed below.
Recycled Products 74%
Energy Recovery-Cement Kilns 23%
Incineration 1.9%
Other 1.1%]
<PAGE>
S-K BELIEVES:
LLE SERVICE CENTER PROPOSALS
WOULD REDUCE GROSS PROFIT
AVERAGE BRANCH EXPENSE BY TYPE
[Graph showing breakdown of average annual costs for Safety-Kleen branches.
The data includes ($000s)
Material/Disposal $593
Labor/Benefits $1,031
Transportation $301
Equipment at Customers $159
Facilities $210
Other $123]
Branch sales/service people and trucks generate revenue of over $280,000 per
capita and waste disposal is a function of sales volume. Therefore, we believe
proposed cuts will impair revenue and profit.
FURTHER PEOPLE CUTS WOULD
LOSE BUSINESS
LLE proposes to eliminate at least 600 personnel --
equivalent to all personnel in the Elgin Headquarters
This is the centralized support for:
. 5,000,000 Customer Transactions
. 3,600 Fleet Vehicles
. 1,400 Railcars
. 1,000 Environmental Inspections
. 330,000 Vendor Invoices Processed
. 92 Railsites
. 21,000 Fleet Maintenance Inspections
. 146,000 Customer Calls
. 90,000 Telemarketing Calls
CONCLUSION
SYNERGY SAVINGS & REVENUE REDUCTION
ESTIMATED 1998 EPS ACCRETION/(DILUTION)
[Table showing impact on SK/LLE combination of reduced service levels
resulting from various synergy levels.
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Synergy Savings = $100MM Synergy Savings = $75MM
0% 28% 0% 2%
% SK 5% 2% % SK 5% -24%
Sales Lost 10% -24% Sales Lost 10% -50%
15% -51% 15% -76%
20% -77% 20%
- -------------------------------------------------------------------------------
Synergy Savings = $50MM Synergy Savings = $25MM
0% -25% 0% -51%
% SK 5% -51% % SK 5% -77%
Sales Lost 10% -77% Sales Lost 10%
15% 15%
20% 20%
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("% Sales Lost" for this analysis is SK service revenue lost, with SK service
revenue assumed to be $797.8 million, or the estimated level of service
revenue for the LTM period ended 8/31/98. Note that service revenue excludes
revenue from Oil Services and Europe. The related reduction in SK COGS is
calculated assuming that the variable cost represents approximately 39% of US
Industrial and Automotive service revenue (based on fiscal 1997 actuals).)]
<PAGE>
CONCLUSION
Bottom Line: Will an LLE/SK
Combination Be Synergistic?
We believe a Laidlaw acquisition brings:
- A declining hazardous waste disposal business to burden Safety-Kleen's
service and recycling business.
- The weight and demands of $2.3 billion in debt
- Substantial environmental remediation and closure liabilities
- An increase in the shares and public float of stock by 270%
- Business concern that these burdens and proposed deep cuts in people will
decrease productivity and financial results
- Synergies which will be dilutive if not achieved and could impair financial
performance if achieved
<PAGE>
The following advertisement is definitive additional material of Safety-Kleen
Corp.
TO ALL SAFETY-KLEEN SHAREHOLDERS:
THE SK PARENT CORP. DEAL IS REAL
Concerns about the financing for SK Parent's $27 per share all-cash merger offer
have been addressed:
. After considering Philip's release of its year-end results, Philip's lender
has reaffirmed its commitment to advance funds to finance Philip's $200
million equity contribution to SK Parent.
. Apollo and Blackstone's equity commitments are also in place.
. SK Parent's $1.5 billion borrowing to finance the remaining portion of its
offer is fully underwritten and fully syndicated.
SK PARENT CORP.'s $27 ALL-CASH OFFER BEATS
THE UNCERTAIN ALTERNATIVE
. SK Parent Corp.'s $27 per share all-cash offer represents a 52 percent
premium to the closing share price the day before your Board initiated its
process to maximize the value of your Safety-Kleen shares.
. Safety-Kleen's Board of Directors is convinced that Laidlaw Environmental
can not achieve the synergies necessary to make the transaction non-
dilutive to Laidlaw Environmental's earnings per share without
significantly reducing Safety-Kleen's service quality, revenue and profit.
VOTE NOW FOR THE SK PARENT CORP.
$27 ALL-CASH OFFER
To receive $27 cash for your Safety-Kleen shares promptly after the vote is
certified, we need the votes of two-thirds of Safety-Kleen shareholders FOR the
merger offer.
[Safety-Kleen Logo]
If you have any questions or need additional information, please contact our
proxy solicitor:
[CHASE MELLON LOGO]
Toll Free (888) 224-2734
Fax (212) 273-8183 or (212) 274-8184
<PAGE>
The following is a press release issued by Safety-Kleen Corp. on March 6, 1998:
SAFETY-KLEEN ANNOUNCES FEDERAL DISTRICT COURT ACTION
ELGIN, Ill - March 6, 1998 - Safety-Kleen Corp. announced today that the
Federal District Court for the Northern District of Illinois denied Laidlaw
Environmental's motion to require Safety-Kleen's Board to make its Rights
Agreement, or poison pill, inapplicable to Laidlaw Environmental's exchange
offer before the Safety-Kleen shareholders meeting scheduled for March 9, 1998.
The Judge set another hearing for Thursday, March 12, 1998, to again consider
the motion, after hearing testimony.
Safety-Kleen has committed to the Court that if the SK Parent Merger is
approved by shareholders at the reconvened special meeting on March 9, it will
not close the Merger prior to March 16. Laidlaw Environmental has also committed
to the court that it will extend its exchange offer on its current terms through
March 16.
