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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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AMENDMENT NO. 3
TO
SCHEDULE 14D-1
Tender Offer Statement Pursuant to Section
14(d)(1) of the Securities Exchange Act of 1934
Syntex Corporation
(Name of Subject Company)
Roche Capital Corporation
(Bidder)
Common Stock, Par Value $1.00 Per Share
(Title of Class of Securities)
87161610
(CUSIP Number of Class of Securities)
Dr. Felix Amrein
c/o Roche Holding Ltd
Grenzacherstrasse 124
CH-4002 Basel
Switzerland
Telephone: (41) (61) 688-1111
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Bidder)
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Copies to:
Peter R. Douglas
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
May 6, 1994
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Date Tender Offer First Published, Sent or Given to Security Holders
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CUSIP No. 871 616 10
1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Roche Capital Corporation
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2 (e) OR 2 (f) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Panama
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES* [ ]
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
N/A
10 TYPE OF REPORTING PERSON*
CO
This Amendment No. 3 amends and supplements the Tender Offer Statement
on Schedule 14D-1 (the "Statement") dated May 6, 1994 filed by Roche Capital
Corporation, a Panama corporation (the "Bidder") and a wholly owned subsidiary
of Sapac Corporation Limited, a non-resident Canadian corporation ("Holding"),
which, in turn, is a wholly owned subsidiary of Roche Holding Ltd, a
Switzerland corporation ("Parent"), as amended by Amendment Nos. 1 and 2,
relating to the Bidder's offer to purchase all outstanding shares of Common
Stock, $1.00 par value (the "Shares") of Syntex Corporation (the "Company"),
at $24.00 per Share, net to the seller in cash, upon the terms and subject to
the conditions set forth in the Offer to Purchase and the related Letter of
Transmittal, copies of which are attached as Exhibits (a)(1) and (a)(2) to
the Statement (which are herein referred to as the "Offer"). Capitalized terms
not separately defined herein shall have the meanings specified in the
Statement.
THE FOLLOWING INFORMATION SUPPLEMENTS THE OFFER TO PURCHASE
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS AND PROPOSALS
OF THE BIDDER.
In the event that more than 299 holders of Shares make
otherwise valid Stock Elections, but the Purchaser and the
Special Committee of the Company are unable jointly to
agree, in their discretion, the method for selecting holders
who will be entitled to receive LCPS pursuant to otherwise
valid Stock Elections (which method may consist of a
lottery, selection by lot or according to the aggregate
number of Shares as to which a holder makes a valid Stock
Election, or any other method), the Merger Agreement
provides that the Purchaser may, in its sole discretion,
agree with any stockholder of the Company to exchange such
stockholder's Shares for a security having terms no more
favorable to such stockholder than the terms of the LCPS (an
"Alternative Exchange"), so long as all such Alternative
Exchanges, if any, are effected on equivalent terms.
Purchaser will not, however, be required to agree to make an
Alternative Exchange with any stockholder of the Company and
may, in its sole discretion, determine to effect an
Alternative Exchange with one or more, but fewer than all,
stockholders who may have made a Stock Election or otherwise
desire to effect an Alternative Exchange. Any determination
by the Purchaser to effect or not effect an Alternative
Exchange with any stockholder will be made in the sole
discretion of the Purchaser. There can be no assurance that
any Alternative Exchanges will be effected, nor any
assurance that if more than one such Alternative Exchange is
effected, that all such Alternative Exchanges will be
effected in the same manner, at the same time or with the
same effects on stockholders with whom the Purchaser effects
Alternative Exchanges. The time and manner of any
Alternative Exchange will be determined by the Purchaser in
its sole discretion, subject only to any restrictions in the
Merger Agreement.
ITEM 10. ADDITIONAL INFORMATION.
(c) EC Merger Regulation. Purchaser filed the
required notice pursuant to the EC Merger Regulation with
the EC Commission on May 16, 1994. The EC Commission
confirmed on May 26, 1994 that the notified concentration
has a "community dimension" and that the EC Commission has
jurisdiction to review the transaction. The EC Commission
has invited, as is customary, third parties to comment on
the notified transaction within ten days. Although the EC
Merger Regulation does not prohibit the Purchaser from
acquiring the Shares prior to the end of the "suspension"
period (currently expected to end on June 13, 1994), the EC
Merger Regulation would not allow the Purchaser to vote
Shares prior to the end of the "suspension" period. In
addition, the EC Commission may determine to extend the
"suspension" period applicable to the Offer. The EC
Commission may also, on or before June 20, 1994, decide to
initiate proceedings with respect to the Offer.
See Sections 14 and 15 of the Offer to Purchase for
information concerning conditions to the Offer and the
Purchaser's rights to extend or amend the Offer and to delay
acceptance for payment or payment for Shares.
(f) Purchaser has been informed that the Company, on
May 27, 1994, issued the following press release.
"Syntex Corporation (NYSE: SYN) today reported operating
income of $23.6 million in the fiscal 1994 third quarter which ended
April 30, an increase of 26 percent compared to $18 million in the
fiscal third quarter, after a $140 million restructuring charge.
Net income in the third fiscal quarter was $22.4 million in 1994
versus $40.8 million in 1993. Earnings per share in the fiscal 1994
third quarter decreased by 44 percent to $.10 per share compared
with earnings per share of $.18 in the fiscal 1993 third quarter.
The fiscal 1993 third quarter restructuring charge reduced net
earnings by $.48 per share. Sales in the fiscal 1994 third quarter
decreased 31 percent to $402.1 million, compared with sales of
$584.3 million in the third quarter a year ago. The fiscal 1994
third quarter is the first full quarter in which non-Syntex generic
competition for Naprosyn [Registered Trademark] (naproxen) and
Anaprox [Registered Trademark] (naproxen sodium) occurred following
the December 1993 expiration of the U.S. patent for these products.
As previously announced, Syntex and Roche Holding Ltd,
Basel, have entered into a definitive agreement for the acquisition
of Syntex by a subsidiary of Roche. A cash tender offer by Roche to
purchase all of Syntex's outstanding stock at $24 per share is
currently underway and is scheduled to expire June 6 unless extended
by Roche. The Syntex Board of Directors has unanimously recommended
that stockholders tender their shares in the offer. The tender
offer is subject to certain conditions, including that at least a
majority of Syntex shares are tendered and certain regulatory
approvals are obtained.
2
"FISCAL 1994 THIRD QUARTER AND NINE MONTHS RESULTS
($ in millions, except per-share data)
PERCENT PERCENT
THIRD QUARTER CHANGE NINE MONTHS CHANGE
------------------- ------ ------------------ ------
FY 1994 FY 1993 FY 1994 FY 1993
------- ------- ------- -------
Net Sales $402.1 $584.3 (31) $1,403.5 $1,582.0 (11)
Operating $23.6 $158.8 (85) $253.4 $368.0 (31)
Income Before
Restructuring
Charge
Restructuring -- $140.0 -- -- $320.0 --
Charge
Operating $23.6 $18.8 26 $253.4 $48.0 100+
Income After
Restructuring
Charge
Net Income $22.4 $40.8 (45) $244.5 $153.8 59
Earnings Per $.10 $.18 (44) $1.10 $.69 59
Share
"'The decline in sales and earnings in the fiscal
1994 third quarter compared with the third quarter a year
ago was primarily due to the expiration of the U.S. patent
for Naprosyn and Anaprox and the shift in sales from those
branded products to lower-priced generic naproxen and
naproxen sodium products,' said Paul E. Freiman, chairman
and chief executive officer of Syntex Corporation.
"The gross margin declined to 71.5 percent in the
fiscal 1994 third quarter, due to significantly reduced
sales of the higher-margin Naprosyn and Anaprox branded
products in the U.S. and to excess production capacity. In
the fiscal 1993 third quarter, the gross margin was 77.3
percent.
3
"WORLDWIDE HUMAN PHARMACEUTICAL SALES
($ in millions)
PERCENT PERCENT
THIRD QUARTER CHANGE NINE MONTHS CHANGE
------------------- ------ ------------------ ------
FY 1994 FY 1993 FY 1994 FY 1993
------- ------- ------- -------
U.S. Sales $187.5 $371.0 (49) $779.1 $947.1 (18)
Non-U.S. 144.1 141.2 2 417.4 416.4 --
------ ------ -------- --------
Sales
TOTAL $331.6 $512.2 (35) $1,196.5 $1,363.5 (12)
====== ====== ======== ========
NAPROXEN/NAPROXEN SODIUM SALES
($ in millions)
PERCENT PERCENT
THIRD QUARTER CHANGE NINE MONTHS CHANGE
------------------ ------ ------------------ ------
FY 1994 FY 1993 FY 1994 FY 1993
------- ------- ------- -------
U.S. Sales $36.1 $200.0 (82) $339.8 $503.3 (32)
Non-U.S. 58.3 61.6 (5) 175.8 188.3 (7)
Sales ----- ------ ------ ------
TOTAL $94.4 $261.6 (64) $515.6 $691.5 (25)
===== ====== ====== ======
"Worldwide sales of Toradol [Registered Trademark]
(ketorolac tromethamine) in the fiscal 1994 third quarter decreased
15 percent to $81.1 million from $95.0 million in the prior-year
third quarter.
"As previously announced, Syntex and The Proctor & Gamble
Company will begin marketing ALEVE [Registered Trademark] , a new,
over-the-counter pain reliever with naproxen sodium as its key
ingredient, in the United States in the fiscal 1994 fourth quarter.
"Selling, general and administrative (SG&A)
expenses in the fiscal 1994 third quarter decreased 15
percent to $161.5 million from the third quarter a year ago.
Mr. Freiman noted that Syntex has significantly reduced
quarterly SG&A expenses since it initiated restructuring
activities in November 1992.
4
"Spending for research and development in the
third quarter of fiscal 1994 was $102.4 million, a 1 percent
decrease from the third quarter a year ago.
"Mr. Freiman said the company expects to submit New Drug
Applications to the U.S. Food and Drug Administration for oral
Cytovene [Registered Trademark] (ganciclovir sodium) for the
maintenance treatment of cytomegalovirus retinitis in the first half
of calendar 1994 and for mycophenolate mofetil for the prevention of
acute kidney transplant rejection in the second half of calendar
1994. The results of preliminary analyses of data from three
recently-completed clinical studies to determine the effectiveness
of mycophenolate mofetil as adjunctive therapy for the prevention of
acute kidney transplant rejection appear to be positive.
"The provision for income taxes in the fiscal 1994 third
quarter reflects an effective tax rate of 6 percent. The effective
tax rate in the fiscal 1993 third quarter was 4 percent, excluding a
$34.1 million benefit for the restructuring charge.
"Consolidated statements of income follow.
5
"SYNTEX CORPORATION AND SUBSIDIARY COMPANIES
Consolidated Statements of Income
(In millions, except per-share amounts)
PERCENT PERCENT
THIRD QUARTER CHANGE NINE MONTHS CHANGE
------------------ ------ ------------------ ------
FY 1994 FY 1993 FY 1994 FY 1993
------- ------- ------- -------
Net Sales $ 402.1 $584.3 (31) $1,403.5 $1,582.0 (11)
Costs and expenses:
Costs of goods
sold 114.6 132.5 (14) 343.8 332.8 3
Selling, general &
administrative 161.5 189.9 (15) 507.8 580.6 (13)
Research &
development 102.4 103.1 (1) 298.5 300.6 (1)
Restructuring
charge -- 140.0 -- -- 320.0 --
------- ------ -------- --------
Total 378.5 565.5 (33) 1,150.1 1,534.0 (25)
Operating income 23.6 18.8 26 253.4 48.0 100+
------- ------ -------- --------
Nonoperating income
(expense):
Interest income 9.2 9.3 (1) 26.6 30.8 (14)
Interest expense (7.2) (6.9) 4 (20.4) (20.6) (1)
Other--net (1.8) (8.4) (79) (9.5) (64.4) (85)
------- ------ -------- --------
Total 0.2 (6.0) 100+ (3.3) (54.2) (94)
------- ------ -------- --------
Income (loss) before
taxes on income &
cumulative effect
of accounting
changes 23.8 12.8 86 250.1 (6.2) 100+
Provision (benefit)
for taxes on income 1.4 (28.0) 100+ 5.6 (160.9) 100+
------- ------ -------- --------
Income before
cumulative effect
of accounting
changes 22.4 40.8 (45) 244.5 154.7 58
Cumulative effect of
accounting changes,
net of tax -- -- -- -- (.9) --
------- ------ -------- --------
Net income $ 22.4 $40.8 (45) $244.5 $153.8 59
====== ===== ====== ======
Shares used in $221.1 220.9 221.0 222.9
computing earnings ====== ===== ===== =====
per common share
Earnings per common $.10 $.18 (44) $1.10 $.69 59"
share ==== ==== ===== ====
6
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.
ROCHE CAPITAL CORPORATION
By: DR. HENRI B. MEIER
-------------------------
Dr. Henri B. Meier
Vice-President
Dated: May 27, 1994
