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
Date of Report (Date of earliest event reported) August 25, 1995
THE SOUTHERN COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-3526 58-0690070
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification
No.)
64 Perimeter Center East, Atlanta, Georgia 30346
(Address of principal executive offices) (Zip
Code)
Registrant's telephone number, including area code: (770) 393-
0650
N/A
(Former name or former address, if changed since last report.)
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Item 5. Other Events.
On August 25, 1995, Southern Electric International, Inc.
("Southern Electric"), a wholly-owned subsidiary of The Southern
Company ("Southern"), and South Western Electricity plc, a public
limited company organized under the laws of England and Wales
("SWEB"), announced that they had reached agreement on the terms
of a recommended revised cash offer (the "Revised Offer") for the
acquisition of the whole of the ordinary share capital of SWEB
not already owned by Southern and its subsidiaries and subsidiary
undertakings (the "Southern Group"). Southern Electric and SWEB
also announced their agreement that, if the Revised Offer becomes
wholly unconditional, SWEB will pay a special dividend (the
"Special Dividend") of 65p (net) per share to all shareholders on
the register at the close of business on August 24, 1995. The
Special Dividend will be paid at the same time as consideration
is first paid to SWEB shareholders pursuant to the Revised Offer.
The Revised Offer will be made on the basis of (Pound
Sterling)9 in cash, plus the ability to retain the Special
Dividend, for each SWEB Share validly tendered. In addition,
apart from SWEB shareholders who purchased their shares 'ex' the
right to receive such dividend, SWEB shareholders who validly
accept the Revised Offer (including either of the Revised
Alternatives) will retain the final dividend of 20.3p (net) per
SWEB Share for the year ended March 31, 1995, which is payable on
October 2, 1995 to shareholders on the register at the close of
business on July 25, 1995.
SWEB shareholders who validly accept the Revised Offer may
elect, in respect of all or part of their holdings of SWEB
Shares, to receive interest-bearing subordinated unsecured
exchangeable bonds ("GRID Bonds") of Southern Investments UK
Public Limited Company, a public limited company organized under
the laws of England and Wales and a wholly-owned subsidiary of
Southern ("Southern UK"), instead of part of their entitlement to
cash under the Revised Offer on the basis of (Pound Sterling)7 in
cash and (Pound Sterling)2 nominal value of GRID Bonds (and the
ability to retain the Special Dividend) for each SWEB Share
validly tendered. The terms of the GRID Bonds will be as
described in the Current Report on Form 8-K of Southern dated
July 13, 1995. No GRID Bonds will be issued under the Revised
GRID Bonds Alternative unless valid acceptances for that
Alternative are received which would result in the issue of at
least (Pound Sterling)10 million nominal value of GRID Bonds.
SWEB shareholders who validly accept the Revised Offer may
also elect to receive Loan Notes of Southern UK in lieu of all or
part of the consideration to which they would otherwise be
entitled under the Revised Offer. The Loan Note Alternative will
be available on the basis of (Pound Sterling)1 nominal value of
Loan Notes for every (Pound Sterling)1 of cash consideration.
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The Loan Notes, which will be unlisted, will be unsecured
obligations of Southern UK and will bear interest payable semi-
annually in arrears on June 30 and December 31 in each year at a
rate equal to 1% below the London Inter-Bank Offered Rate for six
months British pounds sterling funds for each interest period.
The Loan Notes will be redeemable at the option of the holders at
semi-annual intervals commencing on June 30, 1996 until June 30,
2002, when all outstanding Loan Notes will be redeemed.
Southern UK will make appropriate proposals to option
holders under the SWEB Share Option Schemes in due course.
As of August 31, 1995, the Southern Group owned 33,294,904
SWEB Shares, constituting approximately 29.9% of SWEB's issued
share capital.
The Revised Offer values the whole of the issued share
capital of SWEB at approximately (Pound Sterling)1.1 billion
(approximately U.S. $1.8 billion). The Revised Offer is to be
financed by the issue and underwriting of the Loan Notes, which
are non-recourse to Southern, and by facilities made available to
Southern by lending institutions.
The Revised Offer will be made on the terms and subject to
the conditions of a formal Revised Offer document to be
despatched to SWEB shareholders (including the conditions and
certain further terms set forth in Appendix 1 attached hereto).
Terms used and not otherwise defined herein or in Appendix 1
shall have the meanings set forth in Appendix 2. References
herein to "(Pound Sterling)" and "p" are to British pounds
sterling and British pence, respectively.
THE REVISED OFFER IS NOT BEING MADE, DIRECTLY OR INDIRECTLY,
IN OR INTO, OR BY USE OF THE MAILS OF, OR BY ANY MEANS OR
INSTRUMENTALITY (INCLUDING, WITHOUT LIMITATION, FACSIMILE
TRANSMISSION, TELEX OR TELEPHONE) OF INTERSTATE OR FOREIGN
COMMERCE OF, OR OF ANY FACILITY OF A NATIONAL SECURITIES EXCHANGE
OF, THE UNITED STATES AND THE REVISED OFFER CANNOT BE ACCEPTED BY
ANY SUCH USE, MEANS, INSTRUMENTALITY OR FACILITY OR FROM WITHIN
THE UNITED STATES, CANADA OR AUSTRALIA.
THE LOAN NOTES, THE GRID BONDS AND THE SHARES INTO WHICH THE
GRID BONDS MAY BE EXCHANGEABLE HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"). ACCORDINGLY, THE LOAN NOTES, THE GRID BONDS
AND THE SHARES INTO WHICH THE GRID BONDS MAY BE EXCHANGEABLE MAY
NOT BE OFFERED, SOLD OR EXCHANGED IN THE UNITED STATES OR TO U.S.
PERSONS EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. TERMS USED IN
THIS PARAGRAPH HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S
UNDER THE SECURITIES ACT.
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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 thereunto duly authorized.
THE SOUTHERN COMPANY
By: /s/Patricia L. Roberts
Name: Patricia L. Roberts
Title: Assistant Secretary
Date: September 7, 1995
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APPENDIX 1
Conditions and certain further terms of the Revised Offer and the
Revised Alternatives
Part A: Conditions of the Revised Offer
The Revised Offer (which in this Appendix is deemed to include,
where relevant, references to the Revised Alternatives) will be
subject to the following conditions:
(a) valid acceptances being received (and not, where permitted,
withdrawn) by not later than 1:00 p.m. on September 15, 1995
(or such later time(s) and/or date(s) as Southern UK may,
with the consent of the Panel, decide) in respect of not
less than 90 percent (or such lower percentage as Southern
UK may decide) in nominal value of the SWEB Shares to which
the Revised Offer relates, provided that this condition
shall not be satisfied unless Southern UK and its
subsidiaries shall have acquired or agreed to acquire
(whether pursuant to the Revised Offer or otherwise) shares
in SWEB carrying more than 50 percent of the voting rights
exercisable at a general meeting of SWEB. For the purposes
of this condition:
(i) shares which have been unconditionally allotted shall
be deemed to carry the voting rights they will carry
upon their being entered in the register of members of
SWEB; and
(ii) the expression "SWEB Shares to which the Revised Offer
relates" shall mean (i) SWEB Shares issued or allotted
on or before the date the Revised Offer is made and
(ii) SWEB Shares issued or allotted after that date but
before the time at which the Revised Offer becomes
unconditional as to acceptances but excluding any SWEB
Shares which, on the date the Original Offer was made,
were held or (otherwise than under such a contract as
is described in Section 428(5) of the Companies Act
1985) contracted to be acquired by Southern UK and/or
its associates (within the meaning of Section 430E of
the Companies Act 1985);
(b) an announcement being made by the UK Office of Fair Trading
indicating in terms satisfactory to Southern UK that it is
not the intention of the Secretary of State for Trade and
Industry to refer the proposed acquisition of SWEB by
Southern UK, or any matter arising therefrom, to the
Monopolies and Mergers Commission and the European
Commission indicating in terms satisfactory to Southern UK
that it does not intend to initiate proceedings under
Article 6(1)(c) of Council Regulation (EEC) 4064/89 or make
a referral to a competent authority in the United Kingdom
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under Article 9(1) of such Regulation in respect of the
proposed acquisition of SWEB by Southern UK or any matter
arising therefrom;
(c) the Director General of Electricity Supply indicating in
terms satisfactory to Southern UK that it is not his
intention to seek any modification to one or more of the
licenses held by SWEB under the Electricity Act 1989 and
SWEB not agreeing to any such modification, except, in
either case, on terms satisfactory to Southern UK;
(d) the Director General of Electricity Supply not seeking
undertakings from any member of the Southern Group or any
member of the SWEB Group except on terms satisfactory to
Southern UK;
(e) no government or governmental, quasi-governmental,
supranational, statutory, regulatory or investigative body,
court, trade agency, professional association, environmental
body or any other person or body whatsoever in any
jurisdiction (each a "Third Party") having instituted,
implemented or threatened any action, proceeding, suit,
investigation, enquiry or reference or made, proposed or
enacted any statute, regulation or order or having done
anything which would or might reasonably be expected to:
(i) make the Revised Offer or its implementation, or the
acquisition or the proposed acquisition by The Southern
Company or any of its subsidiaries or subsidiary
undertakings or associated companies (including any joint
venture, partnership, firm or company in which any member of
the Southern Group is interested) or any company in which
any such member has a substantial interest (being a direct
or indirect interest of 20% or more of the voting equity
share capital thereof) (the "wider Southern Group") of any
shares in, or control of, SWEB, void, illegal or
unenforceable, or otherwise restrain, prohibit, restrict or
delay the same or impose additional material conditions or
material obligations with respect thereto, or otherwise
materially challenge or interfere therewith;
(ii) require or prevent a divestiture by any member of the
wider Southern Group of any shares in SWEB;
(iii) require or prevent the divestiture or materially
alter the terms envisaged for any proposed divestiture by
any member of the wider Southern Group or by SWEB or any of
SWEB's subsidiaries or subsidiary undertakings or associated
companies (including any joint venture, partnership, firm or
company in which any member of the SWEB Group is interested)
or any company in which any such member has a substantial
interest (being a direct or indirect interest of 20% or more
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of the voting equity share capital thereof) (the "wider SWEB
Group") of all or any portion of their respective
businesses, assets or property or impose any limitation on
the ability of any of them to conduct their respective
businesses (or any of them) or own their respective assets
or properties or any part thereof;
(iv) impose any limitation on the ability of any member of
the wider Southern Group to acquire, directly or indirectly,
or to hold or to exercise effectively any rights of
ownership of shares in SWEB or shares in any member of the
wider SWEB Group or to exercise effectively rights of
control over any business carried out by a member of the
wider SWEB Group;
(v) impose any material limitation on the ability of any
member of the wider SWEB Group to coordinate its business,
or any part of it, with the businesses of any other members;
or
(vi) otherwise materially and adversely affect the
business, profits or prospects of SWEB and its subsidiaries
and subsidiary undertakings ("the SWEB Group");
(f) all necessary filings having been made in connection with
the Revised Offer and all statutory or regulatory
obligations in any jurisdiction having been complied with in
connection with the Revised Offer or the acquisition by any
members of the wider Southern Group of any shares in, or
control of, SWEB and all authorizations, orders,
recognitions, grants, consents, clearances, confirmations,
licenses, permissions and approvals reasonably deemed
necessary or appropriate by Southern UK or any member of the
wider Southern Group for or in respect of the Revised Offer
(including, without limitation, its financing (which
expression includes, without limitation, any borrowing of
any monies or the entry into of any underwriting agreement
or the giving of any guarantee or security) and
implementation) or the proposed acquisition of SWEB by any
member of the wider Southern Group or in relation to the
affairs of any member of the wider SWEB Group having been
obtained in terms and in a form reasonably satisfactory to
Southern UK from all appropriate Third Parties and all such
authorizations, orders, recognitions, grants, consents,
clearances, confirmations, licenses, permissions and
approvals remaining in full force and effect and there being
no notice of an intention to revoke the same at the time at
which the Revised Offer becomes otherwise unconditional and
all necessary statutory or regulatory obligations in any
jurisdiction having been complied with, the failure to
comply with which would be material in the context of the
Revised Offer or of the SWEB Group;
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(g) all applicable waiting periods and any other time periods
during which any Third Party could institute, implement or
threaten any action, proceedings, suit, investigation,
enquiry or reference under the laws of any jurisdiction,
having expired, lapsed or been terminated;
(h) there being no provision of any arrangement, agreement,
license or other instrument to which any member of the wider
SWEB Group is a party or by or to which any such member or
any of its respective assets may be bound or be subject, and
which, in consequence of the proposed acquisition by any
member of the wider Southern Group of some or all of the
share capital of SWEB or because of a change in the control
or management of SWEB or otherwise, would or might
reasonably be expected to result in:
(i) any moneys borrowed by or any indebtedness (actual or
contingent) of any member of the SWEB Group becoming or
becoming capable of being declared repayable immediately or
prior to their stated maturity or the ability of any such
member to borrow monies or incur any indebtedness being
withdrawn or inhibited;
(ii) the creation or enforcement of any mortgage, charge or
other security interest whenever existing or having arisen
over the whole or any part of the business, property or
assets of any member of the SWEB Group;
(iii) any such arrangement, agreement, license or
instrument being terminated or adversely modified or any
adverse action being taken or any onerous obligation arising
thereunder;
(iv) any assets or interests of any member of the SWEB
Group being or failing to be disposed of or charged or any
right arising under which any such asset or interest could
be required to be disposed of or charged;
(v) any member of the SWEB Group ceasing to be able to
carry on business under any name under which it presently
does so;
(vi) the rights, liabilities, obligations or interests of
any member of the wider SWEB Group under any such
arrangement, agreement, license or instrument or in or with
any firm or body or the business of any member of the wider
SWEB Group with any person (or any arrangement or
arrangements relating to any such interest or business)
being terminated, modified or adversely affected in such a
way as to be material in the context of the SWEB Group; or
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(vii) the financial or trading position or prospects of any
member of the SWEB Group being adversely affected;
(i) no member of the wider SWEB Group having, since March 31,
1995 (except as disclosed in the SWEB Report and Accounts
for the year ended March 31, 1995 and/or announced to the
London Stock Exchange since July 17, 1995 and prior to
August 25, 1995):
(i) issued or agreed to issue or authorized or proposed the
issue of additional shares of any class, or securities
convertible into, or rights, warrants or options to
subscribe for or acquire, any such shares or convertible
securities (save for issues to SWEB or wholly-owned
subsidiaries of SWEB and save for options granted under the
SWEB Share Option Schemes before July 13, 1995 or the issue
of any SWEB Shares allotted upon exercise of options granted
before July 13, 1995 under the SWEB Share Option Schemes);
(ii) declared, paid or made or proposed to declare, pay or
make any bonus, dividend or other distribution other than to
another member of the SWEB Group and save for the final
dividend of 20.3p (net) per SWEB Share for the year ended
March 31, 1995, which is payable on October 2, 1995 to SWEB
shareholders on the register at the close of business on
July 25, 1995 and the proposed special interim dividend of
65p (net) per SWEB Share which it is proposed should be paid
to SWEB shareholders on the register at the close of
business on August 24, 1995 subject to the Revised Offer
becoming unconditional in all respects;
(iii) save for intra SWEB Group transactions, authorized or
proposed or announced its intention to propose any change in
its loan capital;
(iv) save for intra SWEB Group transactions, authorized or
announced its intention to propose any merger, demerger,
reconstruction, amalgamation or acquisition or disposal of
material assets or of shares in any undertaking, other than
in the ordinary course of business;
(v) issued any debentures or (save in the ordinary course
of business and save for intra SWEB Group transactions)
incurred any indebtedness or contingent liability;
(vi) announced any proposal to purchase any of its own
shares or purchased any such shares;
(vii) disposed of, transferred, mortgaged or encumbered any
material assets or any right, title or interest in any
material asset or entered into any contract, transaction or
commitment (whether in respect of capital expenditure or
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otherwise) which is of a long term, onerous or unusual
nature or magnitude, or which could involve an obligation of
such a nature or magnitude;
(viii) entered into any material contract, transaction or
arrangement otherwise than in the ordinary course of
business;
(ix) entered into any contract, transaction or arrangement
which would be materially restrictive on the business of any
member of the SWEB Group;
(x) waived or compromised any claim otherwise than in the
ordinary course of business; or
(xi) entered into an agreement or arrangement or passed any
resolution or made any proposal with respect to any of the
transactions, matters or events referred to in this
paragraph(i);
and for the purpose of paragraphs (ii), (iii), (iv) and (v) of
this condition, the term "SWEB Group" shall mean SWEB and its
wholly-owned subsidiaries;
(j) since March 31, 1995, there having been no adverse change in
the business, financial or trading position or profits or
prospects of the SWEB Group;
(k) no litigation, arbitration proceedings, prosecution or other
legal proceedings to which any member of the wider SWEB
Group is or may become a party (whether as plaintiff or
defendant or otherwise) and no investigation by any Third
Party against or in respect of any member of the wider SWEB
Group having been threatened in writing, announced or
instituted or remaining outstanding by, against or in
respect of any member of the wider SWEB Group and no
contingent liability having, since March 31, 1995, arisen or
become apparent to Southern UK which might in any case
materially and adversely affect the SWEB Group;
(l) Southern UK not having discovered (i) that the financial or
business information disclosed at any time by SWEB either
contains a material misrepresentation of fact or omits to
state a material fact necessary to make the information
contained therein not misleading, (ii) any information which
materially affects the import of any information disclosed
at any time by the SWEB Group or (iii) that any partnership,
company or other entity in which any member of the SWEB
Group has a significant economic interest and which is not a
subsidiary undertaking (as defined in the Companies Act
1985) of SWEB is subject to any material liability,
contingent or otherwise, which is not disclosed in the
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Annual Report and Accounts of SWEB for the financial year
ended March 31, 1995; and
(m) in relation to any release, emission, disposal or other fact
or circumstance which causes or is likely to cause pollution
of the environment or harm to human health, no past or
present member of the wider SWEB Group having, in any
manner, (i) committed any material violation of any laws,
statutes, ordinances, regulations or other requirements of
any Third Party and/or (ii) incurred any material liability
(whether actual or contingent) to any of the foregoing.
Southern UK will reserve the right to waive, in whole or in part,
all or any of the above conditions apart from condition (a).
The Revised Offer will lapse unless all of the conditions have
been fulfilled or (if capable of waiver) waived by midnight on
the twenty first day after the date on which condition (a) is
fulfilled (or such later date as Southern UK may with the consent
of the Panel decide). Southern UK shall not be obliged to treat
any conditions relating to the absence of any particular action
or matter as satisfied until the latest date for the fulfillment
of all conditions referred to in the previous sentence.
The Revised Offer will lapse if the acquisition of SWEB by
Southern UK is referred to the Monopolies and Mergers Commission
or if the European Commission either initiates proceedings under
Article 6(1)(c) of Council Regulation (EEC) 4064/89 or makes a
referral to a competent authority of the United Kingdom under
Article 9(1) of that Regulation before the date on which the
Revised Offer becomes or is declared unconditional as to
acceptances. In such circumstances, the Revised Offer will cease
to be capable of further acceptance and persons accepting the
Revised Offer and Southern UK shall thereupon cease to be bound
by acceptances delivered on or before the date on which the
Revised Offer so lapses.
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Part B: Certain further terms of the Revised Offer and the
Revised Alternatives
The Revised Offer is not being made, directly or indirectly, in
or into, or by use of the mails of, or by any means or
instrumentality (including, without limitation, facsimile
transmission, telex or telephone) of interstate or foreign
commence of, or of any facility of a national securities exchange
of, the United States and the Revised Offer cannot be accepted by
any such use, means, instrumentality or facility or from within
the United States, Canada or Australia.
The Loan Notes and the GRID Bonds to be issued pursuant to the
Revised Offer have not been and will not be registered under the
United States Securities Act of 1933 (as amended) or under any of
the relevant securities laws of Canada or Australia.
Accordingly, the Loan Notes and the GRID Bonds may not be
offered, sold or delivered, directly or indirectly, in the United
States, Canada or Australia. In addition, neither Loan Notes nor
GRID Bonds may be offered, sold or delivered to any United States
person (as defined in the United States Internal Revenue Code).
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APPENDIX 2
Definitions
The following definitions apply throughout this announcement,
unless the context requires otherwise:
"Code" The City Code on Takeovers and
Mergers in the United Kingdom
"GRID Bonds" the proposed interest-bearing
subordinated unsecured exchangeable
bonds of Southern UK to be issued
in registered form to those SWEB
shareholders who elect for the
Revised GRID Bonds Alternative
"Loan Notes" the variable rate unsecured loan
notes of Southern UK to be issued
pursuant to the Loan Note
Alternative.
"Loan Note Alternative" the alternative whereby persons who
validly accept the Revised Offer
may elect to receive Loan Notes
instead of all or part of the cash
to which they would otherwise be
entitled under the Revised Offer or
the Revised GRID Bonds Alternative
"Original Offer" the offer by Southern UK for SWEB
Shares, as set out in the Original
Offer Document
"Original Offer Document" the offer document dated July 17,
1995 issued by SBC Warburg on
behalf of Southern UK
"Panel" The Panel on Takeovers and Mergers
"Revised Alternatives" the Loan Note Alternative and the
Revised GRID Bonds Alternative
"Revised GRID Bonds the alternative whereby persons who
Alternative" validly accept the Revised Offer
may elect to receive GRID Bonds
instead of part of the cash to
which they would otherwise be
entitled under the Revised Offer
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"Revised Offer" the offer, including the Revised
Alternatives, to be made by SBC
Warburg on behalf of Southern UK to
acquire SWEB Shares not already
owned by the Southern Group at the
time the Revised Offer is made and,
where the context admits, any
subsequent revision, variation,
extension or renewal thereof
"Southern" or "The The Southern Company
Southern Company"
"Southern Group" or Southern and its subsidiaries and
"Group" subsidiary undertakings
"Southern UK" Southern Investments UK Public
Limited Company, the subsidiary of
The Southern Company that will make
the Revised Offer
"Special Dividend" the proposed dividend of 65p (net)
per SWEB Share which will, subject
to the Revised Offer becoming
wholly unconditional, be paid to
SWEB shareholders, as described in
this announcement
"SWEB" South Western Electricity plc
"SWEB Group" SWEB and its subsidiaries and
subsidiary undertakings
"SWEB Share Option the SWEB executive scheme and the
Schemes" SWEB share-save scheme
"SWEB Shares" the existing issued and fully paid
ordinary shares of 50p each in SWEB
and any further such shares which
are unconditionally allotted or
issued before the date on which the
Revised Offer closes (or such
earlier date, not being earlier
than the date on which the Revised
Offer becomes unconditional as to
acceptances, as Southern UK may
decide)
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