SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) JULY 23, 1998
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REPUBLIC ENGINEERED STEELS, INC.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 33-70578 52-1635079
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(STATE OR OTHER JURISDICTION (COMMISSION FILE (IRS EMPLOYER
OF INCORPORATION) NUMBER) IDENTIFICATION. NO.)
410 OBERLIN ROAD, S.W. MASSILLON, OHIO 44648
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (330) 837-6000
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NOT APPLICABLE
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(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT.)
NYFS10...:\79\69579\0012\2027\FRM7258Z.07B
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Item 5. Other Events
On July 24, 1998, Republic Engineered Steels, Inc., a Delaware corporation
(the "Company"), announced that it had entered into an Agreement and Plan of
Merger (the "Merger Agreement") with RES Holding Corporation, a Delaware
corporation ("RES Holding"), and RES Acquisition Corporation, a Delaware
corporation and a wholly owned subsidiary of RES Holding ("RES Acquisition").
Pursuant to the Merger Agreement and subject to the conditions contained
therein, RES Holding will acquire the Company by means of a cash tender offer to
be made by RES Acquisition for all issued and outstanding shares of common stock
of the Company, at a per share cash price of $7.25, followed by a merger (the
"Merger") pursuant to which all shares outstanding at the time of the Merger
(with certain exceptions as described in the Merger Agreement) will be converted
into the same cash consideration.
A copy of the press release, dated July, 24, 1998, announcing the
execution of the Merger Agreement is filed herewith as Exhibit 5.1 and
incorporated herein and made a part hereof by this reference.
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ITEM 7. EXHIBITS
5.1 Press release, dated July 24, 1998.
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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.
Dated: July 28, 1998.
REPUBLIC ENGINEERED STEELS, INC.
By: /s/ Harold V. Kelly
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Name: Harold V. Kelly
Title: Executive Vice President
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EXHIBIT INDEX
Exhibit Number Description
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5.1 Press release, dated July 24, 1998.
5
Exhibit 5.1
FOR IMMEDIATE RELEASE
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THE BLACKSTONE GROUP REPUBLIC ENGINEERED STEELS, INC.
MEDIA CONTACT: MEDIA CONTACTS:
Stephen A. Schwarzman Harold V. Kelly
President and CEO Executive Vice President
(212) 836-9823 (330) 837-6340
Marian J. Carpenter
Director, Corporate Communications
(330) 837-6302
e-mail: [email protected]
INVESTOR RELATIONS CONTACT:
John B. George
Treasurer
(330) 837-6491
REPUBLIC AGREES TO ACQUISITION
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MASSILLON, Ohio -- July 24, 1998 -- Republic Engineered Steels, Inc. (Nasdaq:
REPS), along with an affiliate of Blackstone Capital Partners II Merchant
Banking Fund L.P. and Veritas Capital Partners L.P., announced today that they
have agreed to the acquisition of Republic by the Blackstone-Veritas affiliate
for a cash price of $7.25 per share of Republic common stock.
The acquisition of Republic will occur by means of a cash tender offer for
all issued and outstanding shares, followed by a merger in which all remaining
shares will be converted into the same cash consideration. Including acquired
debt, the total purchase price is $420 million.
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Following consummation of this transaction, Blackstone and Veritas intend
to combine Republic with Bar Technologies, Inc. (known as BarTech), which they
control. However, the proposed acquisition of Republic is not conditioned on
combining Republic and BarTech.
"Republic has made significant achievements in its nine-year history and
acknowledges the contributions all of its constituents made to those successes.
Now, the potential acquisition of the Company by an affiliate of Blackstone and
Veritas can position Republic to move aggressively into the next century to
satisfy the needs and demands of its customers," said Russell W. Maier, Chairman
and Chief Executive Officer of Republic.
David A. Stockman, Senior Managing Director of the Blackstone Group,
stated, "Following the transaction, our plan is to combine the best operations
of both companies, invest substantial capital in new mills and upgraded
facilities, and implement a constructive new relationship with the Steelworkers
Union -- including a new, five-year contract with improved wages, pensions and
productivity practices. These elements will make Republic/BarTech a world-class
SBQ bar steel supplier with the best range of product and customer service in
the marketplace."
United Steelworkers of America President George Becker offered an
enthusiastic endorsement of the proposed transaction. He said, "The Union looks
forward to working with Blackstone/BarTech to create a world-class company. Our
experience with them so far has been a very constructive one. Together, we have
fashioned a new labor agreement which both fully recognizes the union's security
and economic needs and gives the company the ability to be competitive on a
global basis. The final decision on the new agreement
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obviously belongs to our members, but we are very hopeful that they will support
this new beginning for their companies."
Securities law requires the acquiring party to begin its tender offer for
Republic's stock no later than July 30, 1998. The transaction is subject to
customary conditions, including financing, applicable regulatory clearances, and
ratification by USWA-represented employees of a new collective bargaining
agreement intended to be applicable to Republic and BarTech. The new collective
bargaining agreement has been endorsed by the United Steelworkers.
The Board of Directors of Republic has approved the merger agreement and
recommended that Republic's stockholders accept the tender offer and approve and
adopt the merger agreement. The Board of Directors was advised on the financial
aspects of the transaction by Lazard Freres & Co. LLC.
Republic Engineered Steels, Inc. is a leading domestic producer of carbon
and alloy high-quality engineered bar, stainless, tool steels, and remelted
specialty steels designed to meet the world's most demanding applications.
Headquartered in Massillon, Ohio, Republic has 10 plants located in Ohio,
Pennsylvania, Connecticut, Maryland, Indiana and Illinois and is one of the
leading recyclers in Ohio.
Bar Technologies Inc. produces and markets hot rolled engineered and cold
finished steel bar products direct to the automotive, machinery, industrial
equipment, and tool industries, and to cold finished bar producers, independent
forgers and steel service centers.
The Blackstone Group was founded in 1985 by its current Chairman, Peter G.
Peterson and its current President and CEO, Stephen A. Schwarzman. In addition
to
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sponsoring the largest private equity fund for corporate investments raised in
1997, The Blackstone Group is also a leader in real estate investing, as well as
mergers and acquisitions and restructuring and reorganization advisory services,
and liquid alternative asset investing.
Veritas Capital is a private investment fund founded by Robert B. McKeon
in 1992. Veritas and Blackstone have been partners in Bar Technologies, Inc.
since April 1996.
