-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GCgO/yt6eseOeThm4oHTIfEU4IjOk4zH5Uef62FGbPdq2ZxaA3dsdjLG5cX5Xl9s 1yRLKdWJCEPelkNrAAViWQ== 0000357235-06-000054.txt : 20060126 0000357235-06-000054.hdr.sgml : 20060126 20060125173901 ACCESSION NUMBER: 0000357235-06-000054 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20060126 DATE AS OF CHANGE: 20060125 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CHIRON CORP CENTRAL INDEX KEY: 0000706539 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 942754624 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-35798 FILM NUMBER: 06550578 BUSINESS ADDRESS: STREET 1: 4560 HORTON ST CITY: EMERYVILLE STATE: CA ZIP: 94608 BUSINESS PHONE: 5106558730 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CAM North America, LLC CENTRAL INDEX KEY: 0001348883 IRS NUMBER: 010846058 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 399 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 800-691-6959 MAIL ADDRESS: STREET 1: 399 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D 1 chiron13d.txt CHIRON CORP. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) Chiron Corporation ------------------------------------------------ (Name of Issuer) Common Stock, $0.01 par value ------------------------------------------------ (Title of Class of Securities) 170040109 - ------------------------------------------------ (CUSIP Number) Michael Rosenbaum CAM North America, LLC 399 Park Avenue New York, NY 10043 212-559-3627 - ------------------------------------------------ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) January 25, 2006 ------------------------------------------------ (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 240.13d-1(b)(e), 240.13d-1(f) or 240.13d-1(g) check the following box [X]. NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 240.13d-7(b) for other parties to whom copies are to be sent. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act(however, see the Notes). SCHEDULE 13D CUSIP NO. 170040109 1. Name Of Reporting Person: CAM North America, LLC Tax Identification No: 01-0846058 2. Check The Appropriate Box If A Member Of A Group (a) [X] (b) [ ] 3. Sec Use Only 4. Source Of Funds: OO 5. Check Box If Disclosure Of Legal Proceedings Is Required Pursuant To Items 2(d) or 2(e): [ ] 6. Place Of Organization: Delaware Number of shares beneficially owned by Reporting Person with: 7. Sole Voting Power: - 0 - 8. Shared Voting Power Beneficially: 13,516,345 9. Sole Dispositive Power: - 0 - 10. Shared Dispositive Power: 14,356,145 11. Aggregate Amount Beneficially Owned By Reporting Person: 14,356,145 12. Check Box If The Aggregate Amount In Row (11) Excludes Certain Shares: [ ] 13. Percent Of Class Represented By Amount In Row (11): 7.61% 14. Type Of Reporting Person: IA ----------------------------------------------------------------------------- SCHEDULE 13D CUSIP NO. 170040109 1. Name Of Reporting Person: Smith Barney Fund Management LLC Tax Identification No: 13-2616913 2. Check The Appropriate Box If A Member Of A Group (a) [X] (b) [ ] 3. Sec Use Only 4. Source Of Funds: OO 5. Check Box If Disclosure Of Legal Proceedings Is Required Pursuant To Items 2(d) or 2(e): [ ] 6. Place Of Organization: Delaware Number of shares beneficially owned by Reporting Person with: 7. Sole Voting Power: - 0 - 8. Shared Voting Power Beneficially: 8,773,465 9. Sole Dispositive Power: - 0 - 10. Shared Dispositive Power: 8,773,465 11. Aggregate Amount Beneficially Owned By Reporting Person: 8,773,465 12. Check Box If The Aggregate Amount In Row (11) Excludes Certain Shares [ ] 13. Percent Of Class Represented By Amount In Row (11): 4.65% 14. Type Of Reporting Person: IA ----------------------------------------------------------------------------- SCHEDULE 13D CUSIP NO. 170040109 1. Name Of Reporting Person: Salomon Brothers Asset Management Inc Tax Identification No: 13-3440564 2. Check The Appropriate Box If A Member Of A Group* (a) [X] (b) [ ] 3. Sec Use Only 4. Source Of Funds: OO 5. Check Box If Disclosure Of Legal Proceedings Is Required Pursuant To Items 2(d) or 2(e): [ ] 6. Place Of Organization: Delaware Number of shares beneficially owned by Reporting Person with: 7. Sole Voting Power: - 0 - 8. Shared Voting Power Beneficially: 96,247 9. Sole Dispositive Power: - 0 - 10. Shared Dispositive Power: 96,247 11. Aggregate Amount Beneficially Owned By Reporting Person: 96,247 12. Check Box If The Aggregate Amount In Row (11) Excludes Certain Shares: [ ] 13. Percent Of Class Represented By Amount In Row (11): 0.05% 14. Type Of Reporting Person: IA ----------------------------------------------------------------------------- ITEM 1. SECURITY AND ISSUER. This Schedule 13D relates to the Common Stock $0.01 par value (the "Common Stock") of Chiron Corporation, a Delaware corporation (the "Issuer"). The address of the principal executive offices of the Issuer is 4560 Horton Street, Emeryville, CA 94608. ITEM 2. IDENTITY AND BACKGROUND. This statement is filed jointly by CAM North America, LLC ("CAM NA"), Smith Barney Fund Management LLC ("SBFM") and Salomon Brothers Asset Management Inc. ("SaBAM", and together with CAM NA and SBFM, the "Reporting Persons"). Each of CAM NA and SBFM is a Delaware limited liability company, and SaBAM is a Delaware corporation. Each of CAM NA, SBFM and SaBAM is a registered investment adviser under the Investment Advisers Act of 1940 ("Advisers Act") with its principal office located at 399 Park Avenue - 4th Floor, New York, NY 10043. Except as described below, none of the entities identified in this Item 2 has during the past five years been convicted in any criminal proceeding, nor been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. On May 31, 2005, the Securities and Exchange Commission (the "SEC") issued an order in connection with the settlement of an administrative proceeding against SBFM and Citigroup Global Markets, Inc. ("CGM") relating to the appointment of an affiliated transfer agent for the Smith Barney family of mutual funds (the "Smith Barney Funds"). At the time the order was issued, SBFM was an affiliate of CGM. The SEC order finds that SBFM and CGM willfully violated Section 206(1) of the Advisers Act. Specifically, the order finds that SBFM and CGM knowingly or recklessly failed to disclose to the Boards of the Smith Barney Funds in 1999 when proposing a new transfer agent arrangement with an affiliated transfer agent that: First Data Investors Services Group ("First Data"), the Smith Barney Funds' then-existing transfer agent, had offered to continue as transfer agent and do the same work for substantially less money than before; and that Citigroup Asset Management, then a Citigroup business unit that included the Smith Barney Funds' investment manager and other investment advisory companies, had entered into a side letter with First Data under which Citigroup Asset Management agreed to recommend the appointment of First Data as sub-transfer agent to the affiliated transfer agent in exchange, among other things, for a guarantee by First Data of specified amounts of asset management and investment banking fees to Citigroup Asset Management and CGM. The order also finds that SBFM and CGM willfully violated Section 206(2) of the Advisers Act by virtue of the omissions discussed above and other misrepresentations and omissions in the materials provided to the Smith Barney Funds' Boards, including the failure to make clear that the affiliated transfer agent would earn a high profit for performing limited functions while First Data continued to perform almost all of the transfer agent functions, and the suggestion that the proposed arrangement was in the Smith Barney Funds' best interests and that no viable alternatives existed. SBFM and CGM do not admit or deny any wrongdoing or liability. The settlement does not establish wrongdoing or liability for purposes of any other proceeding. The SEC censured SBFM and CGM and ordered them to cease and desist from violations of Sections 206(1) and 206(2) of the Advisers Act. The order requires Citigroup to pay $208.1 million, including $109 million in disgorgement of profits, $19.1 million in interest, and a civil money penalty of $80 million. Approximately $24.4 million has already been paid to the Smith Barney Funds, primarily through fee waivers. The remaining $183.7 million, including the penalty, has been paid to the U.S. Treasury and will be distributed pursuant to a plan to be prepared by Citigroup and submitted within 90 days of the entry of the order for approval by the SEC. The order also requires that transfer agency fees received from the Smith Barney Funds since December 1, 2004 less certain expenses be placed in escrow and provides that a portion of such fees may be subsequently distributed in accordance with the terms of the order. The order requires SBFM to recommend a new transfer agent contract to the Smith Barney Fund Boards within 180 days of the entry of the order; if a Citigroup affiliate submits a proposal to serve as transfer agent or sub-transfer agent, an independent monitor must be engaged at the expense of SBFM and CGM to oversee a competitive bidding process. Under the order, Citigroup also must comply with an amended version of a vendor policy that Citigroup instituted in August 2004. That policy, as amended, among other things, requires that when requested by a Smith Barney Fund Board, Citigroup Asset Management will retain at its own expense an independent consulting expert to advise and assist the Board on the selection of certain service providers affiliated with Citigroup. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. The source of funds used for the purchase of the Issuer's securities were funds in certain investment advisory accounts managed by the Reporting Persons. The aggregate funds used by the Reporting Persons to make the purchases were $974,972,903. ITEM 4. PURPOSE OF TRANSACTION. The Reporting Persons have acquired the Issuer's Common Stock for investment purposes on behalf of certain investment advisory accounts, and such purchases have been made in the Reporting Persons' ordinary course of business as investment advisers. Depending on the Reporting Persons' assessment of future developments, one or more of the Reporting Persons may acquire additional securities of the Issuer or may determine to sell or otherwise dispose of all or some holdings in the Issuer. On November 25, 2005, the Issuer filed a Schedule 14A with the Commission regarding the acquisition by Novartis of all of the outstanding shares of the Issuer not already owned by Novartis at a price of $45 per share (the "Transaction"). On January 25, 2006, CAM NA, on behalf of itself and certain affiliated advisers, sent a letter (the "Letter") to Howard H. Pien, Chairman of the Board of Directors and Chief Executive Officer of the Issuer, stating that they believed the merger consideration of $45 in cash per Chiron share being offered by Novartis in the proposed Transaction is financially inadequate. The Letter further stated that CAM NA and such affiliated advisers intend to vote against the proposed Transaction. A copy of the Letter is attached as Exhibit B to this Schedule 13D and is incorporated herein by reference. The Reporting Persons may at any time reconsider and change their plans or proposals relating to the foregoing. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER (a) and (b). Set forth below is the beneficial ownership of shares of Common Stock of the Issuer for the Reporting Persons named in Item 2. As of the date hereof, CAM NA is the beneficial owner of 14,356,145 shares of Common Stock, representing approximately 7.61% of the Issuer's outstanding Common Stock, SBFM is the beneficial owner of 8,773,465 shares of Common Stock, representing approximately 4.65% of the Issuer's outstanding Common Stock, and SaBAM is the beneficial owner of 96,247 shares of Common Stock, representing approximately 0.05% of the Issuer's outstanding Common Stock. All percentages set forth in this Schedule 13D are based upon the Issuer's reported 188,575,753 outstanding shares of Common Stock reported in the Issuer's Form 10-Q for the quarterly period ended September 30, 2005. (c) The following table sets forth the Reporting Persons' transactions in the shares of Common Stock of the Issuer during the sixty (60) days preceding the date of this report: Reporting Person Date Shares Price Transaction CAM NA 11/25/2005 1,910 44.35 Open Market Sale CAM NA 11/28/2005 6,148 44.28 Open Market Sale CAM NA 11/29/2005 8,546 44.34 Open Market Sale CAM NA 11/30/2005 6,095 44.27 Open Market Sale CAM NA 11/30/2005 10 44.31 Open Market Purchase CAM NA 12/1/2005 8,791 44.33 Open Market Sale CAM NA 12/1/2005 15 44.31 Open Market Purchase CAM NA 12/2/2005 7,721 44.31 Open Market Sale CAM NA 12/2/2005 750 44.32 Open Market Purchase SBFM 12/2/2005 500 44.42 Open Market Purchase CAM NA 12/5/2005 6,533 44.32 Open Market Sale CAM NA 12/6/2005 11,227 44.50 Open Market Sale CAM NA 12/6/2005 120 44.49 Open Market Purchase CAM NA 12/7/2005 7,684 44.49 Open Market Sale CAM NA 12/8/2005 7,167 44.49 Open Market Sale CAM NA 12/8/2005 65 44.49 Open Market Purchase CAM NA 12/9/2005 8,302 44.51 Open Market Sale CAM NA 12/12/2005 7,656 44.54 Open Market Sale CAM NA 12/13/2005 12,635 44.58 Open Market Sale CAM NA 12/14/2005 20,957 44.59 Open Market Sale CAM NA 12/15/2005 15,456 44.68 Open Market Sale CAM NA 12/16/2005 8,457 44.79 Open Market Sale CAM NA 12/16/2005 2 44.68 Open Market Purchase CAM NA 12/19/2005 7,671 44.83 Open Market Sale CAM NA 12/20/2005 9,149 44.65 Open Market Sale CAM NA 12/21/2005 13,384 44.67 Open Market Sale CAM NA 12/22/2005 11,370 44.72 Open Market Sale CAM NA 12/22/2005 540 44.73 Open Market Purchase CAM NA 12/23/2005 5,977 44.63 Open Market Sale CAM NA 12/27/2005 9,600 44.60 Open Market Sale CAM NA 12/28/2005 13,551 44.64 Open Market Sale CAM NA 12/29/2005 13,845 44.55 Open Market Sale CAM NA 12/30/2005 5,917 44.42 Open Market Sale CAM NA 1/3/2006 9,298 44.63 Open Market Sale CAM NA 1/4/2006 9,964 44.69 Open Market Sale CAM NA 1/5/2006 7,644 44.62 Open Market Sale CAM NA 1/6/2006 6,100 44.70 Open Market Sale CAM NA 1/9/2006 6,380 44.71 Open Market Sale CAM NA 1/9/2006 250 44.73 Open Market Purchase CAM NA 1/10/2006 6,513 44.69 Open Market Sale CAM NA 1/11/2006 5,436 44.71 Open Market Sale CAM NA 1/12/2006 7,314 44.66 Open Market Sale CAM NA 1/13/2006 6,114 44.70 Open Market Sale CAM NA 1/17/2006 5,858 44.73 Open Market Sale CAM NA 1/18/2006 6,728 44.78 Open Market Sale CAM NA 1/18/2006 10 44.80 Open Market Purchase CAM NA 1/19/2006 7,030 44.80 Open Market Sale CAM NA 1/20/2006 6,111 44.74 Open Market Sale CAM NA 1/23/2006 8,818 44.72 Open Market Sale (d) and (e): Not applicable. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER Other than as described elsewhere in this Schedule 13D, the Reporting Persons have no understandings, arrangements, relationships or contracts relating to the Common Stock which are required to be described hereunder. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS A) Joint Filing Agreement B) Letter from CAM NA dated January 25, 2006 to the Issuer. SIGNATURES After reasonable 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. Date: January 25, 2006 CAM North America, LLC By: /s/ George Shively George Shively, Secretary Smith Barney Fund Management LLC By: /s/ Michael Kocur Michael Kocur, Assistant Secretary Salomon Brothers Asset Management Inc By: /s/ George Shively George Shively, Secretary Exhibit A JOINT FILING UNDERTAKING This Joint Filing Agreement confirms the agreement by and among the undersigned parties that the Schedule 13D is being filed jointly on behalf of each of them with the Securities and Exchange Commission pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended. Date: January 25, 2006 CAM North America, LLC By: /s/ George Shively George Shively, Secretary Smith Barney Fund Management LLC By: /s/ Michael Kocur Michael Kocur, Assistant Secretary Salomon Brothers Asset Management Inc By: /s/ George Shively George Shively, Secretary Exhibit B LETTER January 25, 2006 By Overnight Delivery Mr. Howard H. Pien Chairman of the Board and Chief Executive Officer Chiron Corporation 4560 Horton Street Emeryville, California 94608 Re: Proposed Acquisition of Chiron Corporation By Novartis International AG Dear Mr. Pien: CAM North America, LLC and/or certain affiliated entities (collectively, "CAM") serve as adviser to various advisory clients that have been long-term shareholders of Chiron Corporation ("Chiron"), dating back to 1986. Included among these clients is the Smith Barney Aggressive Growth Fund(. Currently, certain of CAM's advisory clients' accounts own approximately 23,225,857 shares of Chiron common stock((, representing 12.32% of all Chiron common shares outstanding and 21.26% of the shares held by shareholders other than Novartis International AG ("Novartis"). As we have informed you previously, we believe the merger consideration offered by Novartis of $45 in cash per Chiron share is financially inadequate; therefore, in keeping with our obligations to act in the best interest of clients, we cannot support this transaction and intend to vote against the proposed acquisition of Chiron by Novartis. Very truly yours, Richard A. Freeman Managing Director CAM North America, LLC cc: Daniel L. Vasella, Chairman and Chief Executive Officer, Novartis Raymund Breu, Director, Chiron Vaughn D. Bryson, Director, Chiron Lewis W. Coleman, Director, Chiron Pierre E. Douaze, Director, Chiron J. Richard Fredericks, Director, Chiron Paul L. Herrling, Director, Chiron Denise O'Leary, Director, Chiron Edward E. Penhoet, Director, Chiron Pieter J. Strijkert, Director, Chiron ( Under a licensing agreement between Citigroup and Legg Mason, the names of funds, the names of any classes of shares of funds, and the names of investment advisers of funds, as well as all logos, trademarks and service marks related to Citigroup or any of its affiliates ("Citi Marks") are licensed for use by Legg Mason Citi Marks include, but are not limited to, "Smith Barney," "Salomon Brothers," "Citi," "Citigroup Asset Management," and "Davis Skaggs Investment Management," Legg Mason and its affiliates, as well as the fund's investment adviser, are not affiliated with Citigroup. All Citi Marks are owned by Citigroup, and are licensed for use until no later than one year after the date of the licensing agreement. (( Of those shares, CAM has sole or shared voting power over at least 22,386,057 shares. -----END PRIVACY-ENHANCED MESSAGE-----