SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Amendment No.1
(Dated July 18, 1997)
to
SCHEDULE 13E-4/A
Issuer Tender Offer Statement
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
INSILCO CORPORATION
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(Name of Issuer)
INSILCO CORPORATION
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(Name of Person(s) Filing Statement)
COMMON STOCK, $.001 PAR VALUE PER SHARE
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(Title of Class of Securities)
457659704
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(CUSIP Number of Class
of Securities)
KENNETH H. KOCH
Vice President and
General Counsel
Insilco Corporation
425 Metro Place N.
Fifth Floor
Dublin, Ohio 43017
(614) 791-3137
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of
the Person(s) Filing Statement)
COPIES TO:
AVIVA DIAMANT
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004
(212) 859-8185
July 11, 1997
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(Date Tender Offer First Published, Sent or Given to Security
Holders)
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Calculation of Filing Fee
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Transaction Valuation*: Amount of Filing Fee:
$110,000,000 $22,000
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* Calculated solely for purposes of determining the filing fee,
based upon the purchase of 2,857,142 shares at the maximum tender
offer price per share of $38.50.
[ ] Check box if any part of the fee is offset as provided by
Rule 0-11(a)(2) and identify the filing with which the offsetting fee
was previously paid. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: N/A Filing Party: N/A
Form or Registration No.: N/A Date Filed N/A
INTRODUCTION
This Amendment No. 1 amends and supplements the Issuer
Tender Offer Statement on Schedule 13E-4 (the "Statement")
relating to the offer by Insilco Corporation (the "Company")
to purchase up to 2,857,142 shares (or such lesser number of shares
as are validly tendered and not withdrawn) of its Common Stock,
$.001 par value per share (the "Shares"), for a purchase price of
$38.50 per Share net to the seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase
dated July 11, 1997 and related documents filed as Exhibits (a)(1)
through (g)(3) to the Statement.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
Item 9 is hereby supplemented and amended as follows:
(g)(4) -- Text of Press Release issued by the Company
dated July 17, 1997.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true,
complete and correct.
INSILCO CORPORATION
By: /s/ Robert L. Smialek
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Name: Robert L. Smialek
Title: Chairman of the Board and
President
Dated: July 18, 1997
EXHIBIT INDEX
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EXHIBIT DESCRIPTION
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(g)(4) -- Text of Press Release issued by the Company
dated July 17, 1997.
NEWS RELEASE
FOR IMMEDIATE RELEASE CONTACT: DAVID A. KAUER
VICE PRESIDENT
AND TREASURER
(614) 792-0468
INSILCO CORPORATION REPORTS SECOND QUARTER 1997 RESULTS
Columbus, Ohio, July 17, 1997 - Insilco Corporation
(NASDAQ:INSL) today reported net income of $11.2 million, or $1.14 per
share, for its second quarter ended June 30, 1997, compared to $11.8
million, or $1.20 per share reported in the year earlier second
quarter. Sales of $169.7 million for the second quarter of 1997 were
up 8%, compared to $156.5 million recorded in the 1996 second quarter,
excluding sales of $21.5 million recorded in the 1996 second quarter
from the Company's office products businesses, which were fully
divested in early March 1997. Including sales from office products,
second quarter 1996 sales were $178.0 million.
For the six months ended June 30, 1997 the Company recorded net
income of $74.5 million, or $7.55 per share, which included an after-
tax gain of $57.8 million, or $5.85 per share, on the first quarter
sale of the Rolodex business unit, compared to $18.0 million, or $1.81
per share recorded in the year earlier six month period. Excluding
sales from the divested office products businesses from both periods,
sales of $276.2 million were up 8% in the first six months of 1997
from $254.7 million recorded in the first six months of 1996.
Including sales from the office products businesses in both periods,
sales were $287.0 million and $300.5 million for the first six months
of 1997 and 1996, respectively.
BUSINESS DISCUSSION
The Company's Automotive Components Group reported 15% sales
growth in the 1997 second quarter to $60.1 million, compared to $52.1
million reported in the year earlier second quarter. Sales of heat
exchangers and related components and equipment were up 24% in the
quarter, including $7.5 million in sales from acquisitions completed
during the 1996 third quarter. The Group also recorded 10% sales
growth in transmission components and stamped steel parts. However,
the positive effect of the sales growth from OEMs was moderated by
continued weakness in aftermarket heat exchanger sales, which resulted
from excess distributor inventories following the mild spring weather.
The Group's 1997 second quarter operating income was $8.0 million,
compared to $7.5 million recorded in the year ago second quarter.
Operating results were positively impacted by improved performance at
its Germany-based aluminum tubing operation, which was acquired last
year, as well as higher income at its stainless steel tubing and
stamped steel parts operations.
The Company recorded $.8 million of equity income in the 1997
second quarter from Thermalex, its 50/50 joint venture with Mitsubishi
Aluminum, which manufactures micro thinwall extruded tubing for
automotive air conditioning condensers. Insilco includes Thermalex's
income as "Other Income" in its consolidated financial results.
The Company's Technologies Group reported 6% sales growth in the
1997 second quarter to $50.9 million from $48.0 million recorded in
the 1996 second quarter. Sales of wire and cable assemblies were up
14% in the quarter and power transformer sales rebounded in the second
quarter with 17% sales growth, principally the result of increased
demand from electronics OEMs, compared to weak demand a year ago.
However, this strong growth was somewhat mitigated by a 4% sales
decline at the Group's Stewart Connector business unit, which was
caused by a slowdown in connector cable assembly orders from a large
telecommunications customer, as well as lower connector sales to the
networking industry. Operating income for the Technologies Group was
$7.5 million in the 1997 second quarter; compared to $8.1 million recorded
in the 1996 second quarter. Operating results at the Company's wire
and cable assembly and power transformer business units improved
sharply during the quarter, however, a less favorable sales mix of
connector products and price degradation on certain mature connector
products contributed to the operating income decline during the
quarter.
Sales at the Company's Taylor Publishing business unit were up 4%
in the 1997 second quarter to $58.7 million, compared to 1996 second
quarter sales of $56.4 million. Taylor's operating income was up a
strong 26% to $6.6 million in the 1997 second quarter, compared to
$5.3 million in the year ago second quarter. The Company said
improved productivity, a favorable mix of larger accounts and lower
administrative expenses positively affected Taylor's results.
SHARE REPURCHASE PLAN
Following the close of the second quarter, the Company announced
that it intends to purchase up to $220 million of its common stock at
a price of $38.50 per share. The Company also announced that the
share repurchase plan would be financed through a combination of
proceeds from the sale of its Rolodex business, a new six year $200
million bank credit facility, and a potential offering of $150 million
of new debt. On a pro forma basis, after giving effect to full
participation in the share repurchase offer and the acquisitions and
divestitures completed in 1996 and 1997, earnings would have been
$1.98 per share for the second quarter of 1997 and $1.92 per share for
the second quarter of 1996. On the same basis, pro forma earnings per
share would have been $2.40 and $2.16 for the first half of 1997 and
1996, respectively. Assuming full participation, the Company will
have approximately 3,854,000 shares outstanding after the share
repurchase.
CEO COMMENTS
Robert L. Smialek, Insilco Chairman and CEO, commented, "We were
very pleased with the results posted by several of our business units.
In the Technologies Group, our wire and cable assembly business
continued to achieve strong double digit sales growth and significant
margin improvement reflecting a broadened customer base and increasing
demand for its contract electronics manufacturing capability. Sales
of power transformers rebounded sharply from a year ago, as well.
Although sales were down at our connector business, we are encouraged
by new product development activities currently underway and expect
meaningful sales in 1998 from new products that are slated to be
introduced in late 1997 and early 1998."
"While the automotive heat exchanger industry was impacted by
mild spring weather across most of the country, which has moderated
aftermarket sales growth, we were pleased with the overall operating
performance of our automotive segment. In particular, the performance
at our Germany-based aluminum tubing operation, which we acquired last
year, has shown greater improvement than we had anticipated by this
time, although still mildly dilutive to overall earnings for the
Group, and continues to see strong orders activity."
"The Thermalex joint venture continues to experience strong
demand for its specialized automobile air conditioner tubing. Growth
this quarter has been limited by capacity, but a fourth complete
extrusion line is in the final stages of installation and should be
available for production early in the fourth quarter."
"It is also gratifying to report a substantial improvement in
operating income at Tayler Publishing during is peak yearbook season.
Since 1994 we have invested heavily to improve Taylor's manufacturing
processes, and in particular to automate its pre-press operations with
digital technology. We are now beginning to reap the rewards of these
investments, not only in improved manufacturing processes and lower
costs, but also in the quality of the yearbooks we produce. Also, the
account mix is improving in response to our new commission structure."
"Our recent announcement to repurchase up to $220 million of our
common stock demonstrates Insilco's continuing commitment to
maximizing value for all shareholders. Our new capital structure will
provide the Company with a reduced after-tax cost of capital and the
opportunity to enhance future shareholder returns, while maintaining
financial flexibility to make capital investments aimed at future
growth."
The statements made in this press release which are not
historical facts may be deemed forward looking statements, and, as
such, are subject to certain risks and uncertainties, including
statements with regard to the Company's self tender offer and its
ability to service its debt and make future investments, and sales
improvement as a result of the introduction of new products. It is
important to note that results could differ materially from those
projected in such forward looking statements. Factors which could
cause results to differ materially include, but are not limited to the
following: delays in new product introductions, lack of market
acceptance of new products, changes in demand for the Company's
products, general competitive pressures from existing and new
competitors, changes in interest rates, and adverse economic
conditions which could affect the amount of cash available for debt
servicing and capital investments.
Insilco Corporation, based in suburban Columbus, Ohio, is a
diversified manufacturer of industrial components and a supplier of
specialty publications. The Company's industrial business units serve
the automotive, electronics, telecommunications and other industrial
markets, and its publishing business serves the school yearbook
market. It had revenues in 1996 of $572 million.
INSILCO CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENTS
(UNAUDITED)
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
<CAPTION>
SIX MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
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<S> <C> <C>
Sales $ 287.0 300.5
Gross Profit 83.4 90.5
% of Sales 29.1% 30.1%
SG&A 52.2 57.6
Goodwill amortization 0.2 -
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Operating Income 31.0 32.9
Interest expense, net (5.7) (8.9)
Gain on sale of Rolodex 95.0 -
Other income and expense, net 1.6 3.1
Income before income taxes 121.9 27.1
Income tax expense (47.4) (9.1)
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Net income $ 74.5 18.0
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Net income per share $ 7.55 1.81
=========== ============
Weighted average shares
outstanding 9.9 9.9
Memo: Depreciation expense
included in earnings $ 9.6 8.1
=========== ============
</TABLE>
INSILCO CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENTS
(UNAUDITED)
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
SECOND QUARTER
<CAPTION>
THREE
THREE MONTHS MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
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<S> <C> <C>
Sales $ 169.7 178.0
Gross Profit 52.2 55.6
% of Sales 30.8% 31.2%
SG&A 32.7 36.0
Goodwill amortization 0.1 -
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Operating Income 19.4 19.6
Interest expense, net (2.5) (4.7)
Other income and expense, net 1.1 2.8
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Income before income taxes 18.0 17.7
Income tax expense (6.8) (5.9)
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Net income $ 11.2 11.8
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Net income per share $ 1.14 1.20
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Weighted average shares
outstanding 9.9 9.9
============ ============
Memo: Depreciation expense
included in earnings $ 5.6 5.0
============ ============
</TABLE>
<TABLE>
INSILCO CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN MILLIONS)
<CAPTION>
6/30/97 12/31/96 6/30/96
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ASSETS
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 111.2 3.5 10.9
Receivables, net 98.2 82.4 93.5
Inventories, net 57.7 66.4 77.7
Current portion of deferred taxes 2.2 29.9 8.6
Prepaid expenses 6.6 7.0 8.6
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Total current assets 275.9 189.2 199.3
Property, plant and equipment, net 110.4 114.4 93.5
Goodwill, net 13.7 13.7 2.7
Deferred taxes 4.9 7.5 21.1
Other assets and deferred charges 18.3 27.2 29.0
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Total assets $ 423.2 352.0 345.6
======= ======== =======
Liabilities and Stockholders'
Equity
Current liabilities:
Current portion of long-term debt $ 24.7 24.3 21.6
Current portion of long-term
obligations 5.6 6.7 7.2
Accrued interest payable 1.1 3.1 2.3
Accounts payable 34.8 38.0 36.5
Accrued expenses and other 64.7 69.1 60.5
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Total current liabilities 130.9 141.2 128.1
Long-term debt 145.1 136.7 171.7
Other long-term obligations 38.7 40.7 43.5
Stockholders' equity 108.5 33.4 2.3
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Total liabilities and
stockholders' equity $ 423.2 352.0 345.6
======= ======== =======
</TABLE>
