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
May 11, 2000 (May 11, 2000)
Date of Report (Date of earliest event reported)
TRIMBLE NAVIGATION LIMITED
(Exact name of registrant as specified in its charter)
California 0-18645 94-2802192
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) identification No.)
645 North Mary Avenue, Sunnyvale, California 94088
(Address of Principal Executive Offices) (Zip Code)
(408) 481-8000
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
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This report contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Actual results could differ materially from
those indicated in the forward-looking statements due to a number of factors
including, but not limited to, as a result of the risk factors set forth below
in this report as well as those set forth in the Company's Annual Report on Form
10-K and the other reports and documents that the Company files from time to
time with the Securities and Exchange Commission.
Item 5. Other Events.
On May 11, 2000, Trimble Navigation Limited ("Trimble") announced it
entered into a definitive agreement to acquire the Spectra Precision wholly
owned businesses of Thermo Instrument Systems Inc., a Thermo Electron company,
collectively known as the "Spectra Precision Group" for an aggregate purchase
price of approximately $280 million. The transaction contemplates the
acquisition of 100% of the stock of Spectra Precision Inc., a Delaware
corporation, Spectra Precision SRL, an Italian corporation, Spectra Physics
Holdings GmbH, a German corporation, and Spectra Precision BV, a Netherlands
corporation. The transaction also contemplates the acquisition of certain assets
and liabilities of Spectra Precision AB, a Swedish corporation, including 100%
of the shares of Spectra Precision SA, a French corporation, Spectra Precision
Scandinavia AB, a Swedish corporation, Spectra Precision of Canada Ltd., a
Canadian corporation, and Spectra Precision Handelsges mbH, an Austrian
corporation.
This transaction will be accounted for as a purchase and will be financed
with approximately $80 million in cash, $80 million in a seller subordinated
note, the assumption of approximately $10 million of debt and additional bank
financing. The company expects to record approximately $240 million of goodwill,
which will be amortized over 20 years. The closing of the transaction, which is
expected at the end of the second fiscal quarter 2000, is subject to regulatory
approval and other conditions to close.
Revenues for the Spectra Precision Group for the last twelve months ended
April 30, 2000, including annualizing the results for Spectra Precision AB's
September 1999 joint venture with an affiliate of the Carl Zeiss Group, were
approximately $230 million. The Spectra Precision Group currently has
manufacturing and development centers in Ohio, Sweden, and Germany, and has
approximately 1,300 employees.
The Spectra Precision Group develops instruments and systems that
provide positioning solutions for four major customer applications:
1. Surveying -- Spectra Precision AB is a leading supplier of surveying and
positioning systems based on both optical measurement and GPS technology.
Products are used in highway construction, site development and other
infrastructure development projects.
2. Construction Site Positioning -- Spectra Precision Group is a leading
supplier of laser-based positioning instruments which permit the accurate
alignment of foundations, sewers, walls, floors and ceilings.
3. Construction and Agricultural Machine Control -- The Spectra Precision
Group is a leading supplier of laser systems which correctly position
and control heavy construction equipment in construction site preparation,
highway construction and agricultural land leveling.
4. Software -- The Spectra Precision Software Inc., a subsidiary of Spectra
Precision, Inc., is a leading developer of three-dimensional land modeling
software for the civil engineering, surveying, construction, GIS and
photogrammetry industries.
We believe that this transaction will strengthen Trimble's position as a
provider of positioning solutions worldwide. Some of the anticipated strategic
and operational benefits include:
1. The combination will create a company with a substantially expanded product
mix, providing current and potential customers with the ability to purchase
a broader range of integrated products and services, for a more complete
solution.
2. The Spectra Precision Group's cutting edge laser and optical capabilities
will complement Trimble's current GPS product offerings and will better
serve the needs of our customers in the surveying, construction, and
agriculture market.
3. The addition of the Spectra Precision Group's products and services will
enable Trimble to address additional segments of the surveying,
construction, and agricultural market not currently served by GPS
technology.
4. An element of Trimble's construction strategy is to be a significant
provider of wireless platforms to the future construction site. The Spectra
Precision Group expands the number of platforms we can integrate into that
wireless information strategy. In addition, the Spectra Precision Group has
over three decades of experience in the construction
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industry and will be a strong partner to Trimble as we execute our
strategy of bringing wireless information to the construction site.
5. The combination will allow Trimble to provide its current GPS products to a
larger customer base by accessing The Spectra Precision Groups
distribution capabilities. In addition, the Trimble sales force will now
have access to the robotic optical total station and be able to provide
existing Trimble customers with a full positioning solution.
6. The combination will provide the opportunity to leverage overhead and
economies of scale to achieve improved financial performance.
7. The combination will assemble a complementary management team with
extensive real-world experience and specialized industry know-how.
Before non-recurring merger related expenses and after accounting for
synergies, increased financing expenses, and goodwill amortization, we expect
the combined pro forma earnings per share, on a fully taxed bases using current
statutory rates to be slightly dilutive in fiscal year 2000 by approximately
five to ten cents per diluted share or 7 to 12%, but significantly accretive in
fiscal year 2001 by approximately 15 to 20%.
The pending acquisition involves a number of risks including Trimble's
ability to finance the acquisition and the associated costs through future cash
flows, the diversion of management's attention to the integration of the
companies, assets, operations and personnel; the introduction of new products
and services into Trimble's business; and the risk of loss of key employees. Our
profitability may suffer if we are unable to successfully integrate and manage
this acquisition, or if we do not generate sufficient revenue to offset the
increased expenses associated with this acquisition.
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SIGNATURES
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.
TRIMBLE NAVIGATION LIMITED
(Registrant)
By: /s/Mary Elen Genovese
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Mary Ellen Genovese
(Vice President Finance, Chief Financial Officer, and
Corporate Controller)
Dated: May 11, 2000
