Filed by Security Capital Group Incorporated
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Security Capital U.S. Realty
Commission File No. 1-15111
Set forth below is the text of a form of letter sent by Security Capital Group
Incorporated to certain shareholders on or about October 16, 2000:
Form Letter
Date
Name
Title
Address
Dear ______:
On September 26, 2000, Security Capital and SC-U.S. Realty announced that
the two companies had agreed to combine. Investor and analyst reaction to the
transaction has been positive. You may wish to review the reports issued by
investment research analysts at Donaldson, Lufkin & Jenrette, First Union, Green
Street Advisors or Merrill Lynch for their objective perspective of the
transaction. These reports can be obtained by contacting each firm directly.
This is a major step in the simplification of Security Capital's
structure; one that we believe will result in significant value for both
shareholder groups. Specifically, this transaction eliminates an operating tier
currently embedded in the structure and removes a level of discount and
unrealized value, increasing pro forma free cash flow from operations on a
per-share basis by 22.4% and pro forma net asset value (NAV) by 12.7%.
Additionally, the combined company will have an equity market capitalization of
over $3 billion and direct control of companies with a total market
capitalization of $26.2 billion. The management and Board of Security Capital
believe that this transaction is another important step towards simplifying
Security Capital's structure and unlocking value.
Over the 12 months prior to making this announcement, Security Capital
completed over $1.1 billion of capital transactions, including $200 million of
SCZ stock repurchases. As part of this transaction, Security Capital announced
an additional $450 million share repurchase program which we believe will
significantly enhance shareholder value.
<PAGE>
Attached for your review is the preliminary prospectus filed with the SEC
on October 13, 2000. I would appreciate it if you would call me with any
questions.
Sincerely,
SECURITY CAPITAL GROUP INCORPORATED
William R. (Todd) Fowler III
Vice President
* * * * * * * * *
Important Information:
---------------------
Security Capital Group Incorporated ("Security Capital") filed a preliminary
Registration Statement on Form S-4 with the United States Securities and
Exchange Commission (the "SEC") on October 13, 2000 relating to the registration
of the issuance of shares of Security Capital stock in the proposed transaction
with Security Capital U.S. Realty ("U.S. Realty") and proposals to be submitted
to shareholders of Security Capital and U.S. Realty in connection with the
transaction. Shareholders of Security Capital and U.S. Realty are urged to read
the definitive joint proxy statement/prospectus when it becomes available
because it will contain important information. You may obtain a free copy of the
definitive joint proxy statement/prospectus (when it is available) and other
documents filed by Security Capital and U.S. Realty with the SEC (including the
documents incorporated by reference into the joint proxy statement/prospectus)
at the SEC's web site at www.sec.gov. Shareholders of Security Capital may also
obtain a free copy of the definitive joint proxy statement/prospectus (when it
is available) and these other documents by directing a request to Security
Capital Group Incorporated, Attention: William R. Fowler, telephone: 800
988-4304. Shareholders of U.S. Realty may also obtain a free copy of the
definitive joint proxy statement/prospectus (when it is available) and these
other documents by directing a request to Security Capital U.S. Realty,
Attention: Laura Hamilton, telephone: +352 46 37 56 2008 (U.S. callers dial 011
352 46 37 56 2008).
Security Capital and certain other persons may be deemed to be participants in
the solicitation of proxies from Security Capital's shareholders to approve the
issuance of Security Capital stock in connection with the proposed transaction.
The participants in this solicitation may include the directors and executive
officers of Security Capital. Information regarding Security Capital's directors
and executive officers and their security holdings in Security Capital is
contained in Security Capital's proxy statement for its annual meeting of
shareholders dated April 10, 2000.
