-----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, Ey5oSDrjx8GYvshVnhrA6zkhn8xJbRy5NzHbCioEB0ANnVJ54yuIis2DwyQY7FAl LbuW0VlIe4ztX+Rsf8ilOQ== 0000898822-01-500423.txt : 20010727 0000898822-01-500423.hdr.sgml : 20010727 ACCESSION NUMBER: 0000898822-01-500423 CONFORMED SUBMISSION TYPE: 425 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20010726 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: VALERO ENERGY CORP/TX CENTRAL INDEX KEY: 0001035002 STANDARD INDUSTRIAL CLASSIFICATION: PETROLEUM REFINING [2911] IRS NUMBER: 741828067 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 SEC ACT: SEC FILE NUMBER: 001-13175 FILM NUMBER: 1690095 BUSINESS ADDRESS: STREET 1: ONE VALERO PLACE CITY: SAN ANTONIO STATE: TX ZIP: 78212 BUSINESS PHONE: 2103702000 MAIL ADDRESS: STREET 1: ONE VALERO PLACE CITY: SAN ANTONIO STATE: TX ZIP: 78230 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: VALERO ENERGY CORP/TX CENTRAL INDEX KEY: 0001035002 STANDARD INDUSTRIAL CLASSIFICATION: PETROLEUM REFINING [2911] IRS NUMBER: 741828067 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 BUSINESS ADDRESS: STREET 1: ONE VALERO PLACE CITY: SAN ANTONIO STATE: TX ZIP: 78212 BUSINESS PHONE: 2103702000 MAIL ADDRESS: STREET 1: ONE VALERO PLACE CITY: SAN ANTONIO STATE: TX ZIP: 78230 425 1 slidepres.txt FORM 425 Filed by Valero Energy Corporation Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934 Subject Company: Valero Energy Corporation Registration No. 333-61756 The following information was posted to Valero Energy Corporation's web site on July 26, 2001: - ----------------- ======================================================= VALERO/UDS VALERO/UDS DEAL PRICING MECHANISM ------------------------------------------------------- o In May, 2001 Valero Energy and Ultramar Diamond Shamrock agreed to a part-cash/part-stock merger in which Valero would exchange all of the shares of UDS for consideration with a value representing a 31.3% premium to UDS' stock price, based on the average closing price of UDS for the 10 day period prior to April 26th. o The total consideration equates to $27.50 in cash and a fixed exchange ratio of 0.614 Valero shares for each outstanding share of UDS common stock, representing an aggregate consideration of approximately $2 billion in cash plus approximately 44.4 million Valero shares (subject to possible adjustment as described below). o A UDS stockholder can elect to receive consideration in the form of cash, Valero stock or a combination. Whatever the form, the mechanism is designed such that the per-share consideration will have the same value, based on the average price of Valero common stock during a 10 day measurement period ending 3 days before closing, regardless of the form of consideration. That per-share value, whether paid in the form of stock or cash, will be the sum of (a) $27.50 and (b) the average value of 0.614 Valero shares during the measurement period. o The elections will be subject to proration, as the total number of Valero shares to be issued and the total amount of cash to be paid in the merger to UDS stockholders as a group are each fixed except that Valero may add more stock, valued at the measurement period value and in lieu of an equivalent amount of cash, if needed to maintain the tax-free treatment of the merger. If stock is oversubscribed, then UDS stockholders who have elected stock will nevertheless receive cash for some of their UDS shares, on a pro rata basis, and vice versa if cash is oversubscribed. Also, if based on the average price of Valero stock during the measurement period the limit on the percentage of UDS shares that may be converted to stock consideration is greater than 50%, Valero at its option, may reduce that limit to 50%. - ----------------- ========================================================= VALERO/UDS EQUALIZATION MECHANISM MM,EXCEPT PER SHARE FIGURES --------------------------------------------------------- ---------------------------------------------------------
TRANSACTION STRUCTURE ----------------------------------------------------------------------------------------------------------- Total UDS Shares 72.3 ------------------------------------------------------------------------------------------------------------- CASH PORTION (VALUE OF $55.00 OFFER AT 50%) STOCK PORTION (VALUE OF 1.228X OFFER AT 50%) ------------------------------------------------------------------------------------------------------------- Cash Offer per Share $27.50 Stock Exchange Ratio 0.614x ------------------------------------------------------------------------------------------------------------- Cash Offered in Transaction ($27.50 x 72.3 Shares) $1,988 Number of Valero Shares (0.614 x 72.3 Shares) 44.4 ------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------ TOTAL PERCENT PERCENT SHARES STOCK BLENDED TOTAL VALUE TOTAL OF UDS TOTAL OF UDS ISSUED CASH REDUCED VALERO CASH EXCHANGE VALUE TRANSACTION CASH OF STOCK CONSIDERATION SHARES SHARES SHARES TO MAINTAIN BY ISSUING SHARE VALUE RATIO AT VALUE PER OFFERED OFFERED BY OFFERED BY PURCH. OFFERED PURCHASED 43% DEAL ADDITIONAL PRICE AT 50% AT 50% 50% UDS SHARE BY VALERO VALERO CASH BY FOR VALERO VALUE IN SHARES VALERO VALERO STOCK STOCK - ------------------------------------------------------------------------------------------------------------------------------------ $25.00 $27.50 0.614x $15.35 [$42.85] $1,766 $1,332 $3,098 57.0% 53.3 43.0% 8.9 $222.4 - ------------------------------------------------------------------------------------------------------------------------------------ 30.00 27.50 0.614x 18.42 [45.92 ] 1,892 1,428 3,320 57.0% 47.6 43.0% 3.2 95.8 - ------------------------------------------------------------------------------------------------------------------------------------ 33.73* 27.50 0.614x 20.71 [48.21] 1,988 1,498 3,486 57.0% 44.4 43.0% -- -- - ------------------------------------------------------------------------------------------------------------------------------------ 35.00 27.50 0.614x 21.49 [48.99] 1,988 1,554 3,542 56.1% 44.4 43.9% -- -- - ------------------------------------------------------------------------------------------------------------------------------------ 40.00 27.50 0.614x 24.56 [52.06] 1,988 1,776 3,764 52.8% 44.4 47.2% -- -- - ------------------------------------------------------------------------------------------------------------------------------------ 45.00 27.50 0.614x 27.63 [55.13] 1,988 1,998 3,986 49.9% 44.4 50.1% -- -- - ------------------------------------------------------------------------------------------------------------------------------------ 50.00 27.50 0.614x 30.70 [58.20] 1,988 2,220 4,208 47.3% 44.4 52.7% -- -- - ------------------------------------------------------------------------------------------------------------------------------------ A B C D E F G H I J K L M - ------------------------------------------------------------------------------------------------------------------------------------ =AxC =B+D =$1,988-M =AxJ =F+G =F/H =44.4+L =G/H =LxA - ------------------------------------------------------------------------------------------------------------------------------------
NOTES: o Assumes at least 43% of the consideration will be required to be paid in Valero stock in order to maination the tax free status of the transaction with respect to the stock consideration. Pursuant to the terms of the merger agreement, the minimum percentage required to be paid in stock will not be determinded until closing and may be higher or lower than the assumption made for this example. o $33.73 represents the breakeven price below which additional stock may be issued to preserve tax-free treatment. - ----------------- ======================================================= VALERO/UDS VALERO/UDS DEAL PRICING MECHANISM ------------------------------------------------------- STATEMENTS CONTAINED IN THIS PRESS RELEASE THAT STATE THE COMPANY'S OR MANAGEMENT'S EXPECTATIONS OR PREDICTIONS OF THE FUTURE ARE FORWARD-LOOKING STATEMENTS INTENDED TO BE COVERED BY THE SAFE HARBOR PROVISIONS OF THE SECURITIES ACT OF 1933 AND THE SECURITIES EXCHANGE ACT OF 1934. IT IS IMPORTANT TO NOTE THAT THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE PROJECTED IN SUCH FORWARD-LOOKING STATEMENTS. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS THAT WILL BE SENT TO VALERO AND UDS STOCKHOLDERS REGARDING THE PROPOSED MERGER, WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. THE JOINT PROXY STATEMENT/PROSPECTUS WILL BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BY VALERO AND UDS. INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE JOINT PROXY STATEMENT/PROSPECTUS, WHEN IT IS AVAILABLE, AND OTHER DOCUMENTS FILED BY VALERO AND UDS WITH THE COMMISSION AT THE COMMISSION'S WEB SITE AT WWW.SEC.GOV. THE JOINT PROXY STATEMENT/PROSPECTUS AND THESE OTHER DOCUMENTS MAY ALSO BE OBTAINED, WHEN AVAILABLE, FREE OF CHARGE FROM VALERO AND UDS. STOCKHOLDERS SHOULD READ THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS CAREFULLY BEFORE MAKING A DECISION CONCERNING THE MERGER. VALERO AND UDS, AND THEIR RESPECTIVE DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN OTHER OF THEIR RESPECTIVE EMPLOYEES, MAY BE SOLICITING PROXIES FROM THEIR RESPECTIVE STOCKHOLDERS IN FAVOR OF THE APPROVAL OF THE MERGER. INFORMATION REGARDING THE PERSONS WHO MAY, UNDER SEC RULES, BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF VALERO AND UDS STOCKHOLDERS IN CONNECTION WITH THE MERGER IS SET FORTH, IN THE CASE OF VALERO, IN VALERO'S PROXY STATEMENT FOR ITS 2001 ANNUAL MEETING, FILED WITH THE SEC ON MARCH 28, 2001, AND IN THE CASE OF UDS, IN UDS'S PROXY STATEMENT FOR ITS 2001 ANNUAL MEETING, FILED WITH THE SEC ON MARCH 27, 2001, AND ADDITIONAL INFORMATION WILL BE SET FORTH IN THE DEFINITIVE PROXY STATEMENT/PROSPECTUS REFERRED TO ABOVE WHEN IT IS FILED WITH THE SEC. -----END PRIVACY-ENHANCED MESSAGE-----