-----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, HSn0w5vffpOQx+Azowc2WdCzu/VKKlw5wbK1FwSg5RC2TUU3d+VvX1y6g1cjytsJ Rspu4jtnvEM6pSxM+7ewxg== 0001019056-97-000338.txt : 19971127 0001019056-97-000338.hdr.sgml : 19971127 ACCESSION NUMBER: 0001019056-97-000338 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19971126 ITEM INFORMATION: FILED AS OF DATE: 19971126 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KNIGHT RIDDER INC CENTRAL INDEX KEY: 0000205520 STANDARD INDUSTRIAL CLASSIFICATION: NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING [2711] IRS NUMBER: 380723657 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07553 FILM NUMBER: 97729164 BUSINESS ADDRESS: STREET 1: ONE HERALD PLZ CITY: MIAMI STATE: FL ZIP: 33132 BUSINESS PHONE: 3053763800 MAIL ADDRESS: STREET 1: ONE HERALD PLZ CITY: MIAMI STATE: FL ZIP: 33132 FORMER COMPANY: FORMER CONFORMED NAME: KNIGHT RIDDER NEWSPAPERS INC /FL/ DATE OF NAME CHANGE: 19860707 8-K 1 FORM 8-K 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) November 14, 1997 KNIGHT-RIDDER, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Florida 1-7553 38-0723657 - -------------------------------------------------------------------------------- (State or other jurisdiction of (Commission (I.R.S. Employer incorporation) File Number) Identification No.) One Herald Plaza, Miami, Florida 33132 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (305) 376-3800 ---------------------- Not Applicable - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Page 1 of 7 Pages Item 2. Disposition of Assets. On November 14, 1997, Knight-Ridder Business Information Services, Inc. (KRBIS), a wholly-owned subsidiary of Knight-Ridder, Inc. (KRI), completed the sale of all of the outstanding stock of Knight-Ridder Information, Inc. (KRII) and Knight-Ridder Information AG (KRIAG), both of which are indirect wholly-owned subsidiaries of KRI, to M.A.I.D. plc for $420 million in cash, subject to a working capital purchase price adjustment which, at the closing, was estimated to require an additional $15 million payment to KRI. In addition, KRI has guaranteed the obligations of KRBIS under the Stock Purchase Agreement. Item 7. Financials and Exhibits. b. Pro Forma Financial Information KRII and KRIAG were previously included in the Business Information Services (BIS) segment, which was discontinued in April 1997. Once that decision was made, related results of operations (including all revenue, expense and related taxes) were reclassified and reported "net" under discontinued operations captions in the consolidated statements of income. Because there are a limited number of pro forma adjustments which affect the condensed consolidated statements of income, a narrative description of their effects is furnished in lieu of pro forma condensed consolidated statements of income. The narrative below outlines the effects of the sale as if it had occurred at the beginning of each period. Tabular pro forma condensed consolidated balance sheets, along with accompanying notes, are presented as if the sale had occurred at the end of the periods presented. The pro forma effects and adjustments were determined based on available information and based on certain allocations that KRI believes are reasonable. The pro forma financial information does not purport to represent what KRI's actual results of operations would have been had the sale occurred at the beginning of the periods presented and may not be indicative of KRI's financial position or operating results for any future date or period. PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME Had the sale occurred as of the beginning of fiscal 1996 or fiscal 1997, net income/(loss) from discontinued BIS operations, net of applicable income taxes, would not have materially changed in 1996 and the entire reported net loss for the three quarters ended September 28, 1997 of $0.7 million would have been eliminated. Also, net income for the year ended December 29, 1996 would have increased by $33.6 million from $267.9 million to $301.5 million, while net income for the three quarters ended September 28, 1997 would have increased by $27.1 million from $310.0 million to $337.1 million. The effect on net income represents the pro forma after tax effects of eliminating the losses from the discontinued KRII and KRIAG operations, the estimated gain on the sale of that business ($22.2 million in 1996 and $17.4 million in 1997) and a reduction of interest expense ($11.4 million for 1996 and $9.0 million for 1997) resulting from applying the after tax net cash proceeds of the sale of KRII and KRIAG towards the reduction of debt. Page 2 of 7 Pages
KNIGHT-RIDDER, INC. PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) (IN THOUSANDS OF DOLLARS) KNIGHT-RIDDER INC. SEPTEMBER 28, PRO FORMA ADJUSTED 1997 ADJUSTMENTS PRO FORMA ---------------- -------------- ------------- ASSETS Cash, including short-term cash investments $ 35,849 $ (14,718)A $ 21,131 Accounts receivable 414,323 (59,863)A 354,460 Inventories 59,029 (406)A 58,623 Prepaid expense 29,906 (10,016)A 19,890 Other current assets 46,268 (1,070)A 45,198 ---------------- -------------- ------------- Total Current Assets 585,375 (86,073) 499,302 ---------------- -------------- ------------- Investments and other assets 371,157 371,157 Net assets of discontinued BIS operations 321,155 (321,155)A Property, plant and equipment, net 1,038,942 1,038,942 Goodwill and other intangible assets, net 2,327,394 2,327,394 ---------------- -------------- ------------- Total $ 4,644,023 $ (407,228) $ 4,236,795 ================ ============== ============= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities 605,269 (59,395)A 615,266 30,579 B 38,813 B ---------------- -------------- ------------- Total Current Liabilities 605,269 9,997 615,266 Noncurrent liabilities 2,343,432 (434,626)C 1,908,806 Minority interests in consolidated subsidiaries 2,002 2,002 Shareholders' Equity Preferred stock 1,755 1,755 Common stock 1,789 1,789 Additional capital 927,638 927,638 Retained earnings 762,138 17,401 D 779,539 ---------------- -------------- ------------- Total Shareholders' Equity 1,693,320 17,401 1,710,721 ---------------- -------------- ------------- Total $ 4,644,023 $ (407,228) $ 4,236,795 ================ ============== =============
See accompanying notes. Page 3 of 7
KNIGHT-RIDDER, INC. PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) (IN THOUSANDS OF DOLLARS) KNIGHT-RIDDER INC. DECEMBER 29, PRO FORMA ADJUSTED 1996 ADJUSTMENTS PRO FORMA ---------------- -------------- ---------------- ASSETS Cash, including short-term cash investments $ 22,880 $ (8,800)A $ 14,080 Accounts receivable 356,079 (56,083)A 299,996 Inventories 42,941 (579)A 42,362 Prepaid expense 90,314 (8,122)A 82,192 Other current assets 53,513 (1,020)A 52,493 ----------------- -------------- ---------------- Total Current Assets 565,727 (74,604) 491,123 ----------------- -------------- ---------------- Investments and other assets 465,676 465,676 Net assets of discontinued BIS operations 325,319 (325,319)A Property, plant and equipment, net 870,187 870,187 Goodwill and other intangible assets, net 636,882 636,882 ----------------- -------------- ---------------- Total $ 2,863,791 $ (399,923) $ 2,463,868 ================= ============== ================ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities 544,570 (51,655)A 557,027 30,579 B 33,533 B ----------------- -------------- ---------------- Total Current Liabilities 544,570 12,457 557,027 Noncurrent liabilities 1,185,666 (434,626)C 751,040 Minority interests in consolidated subsidiaries 2,047 2,047 Shareholders' Equity Common stock 1,945 1,945 Additional capital 308,320 308,320 Retained earnings 819,572 22,246 D 841,818 Unrealized gains on investments 1,671 1,671 ----------------- --------------- ---------------- Total Shareholders' Equity 1,131,508 22,246 1,153,754 ----------------- --------------- ---------------- Total $ 2,863,791 $ (399,923) $ 2,463,868 ================= ============== ================
See accompanying notes. Page 4 of 7 KNIGHT-RIDDER, INC. NOTES TO PRO FORMA BALANCE SHEETS (UNAUDITED) (IN THOUSANDS OF DOLLARS) NOTE A - PRO FORMA ADJUSTMENTS CONDENSED CONSOLIDATED BALANCE SHEET AT SEPTEMBER 28, 1997 A. To eliminate the carrying value of KRII and KRIAG. B. To record $30.6 million of liabilities incurred or assumed and income taxes payable of $38.8 million relating to the sale of KRII and KRIAG. C. To record the use of proceeds to reduce long term borrowings by $434.6 million. These proceeds will be temporarily invested until such time that related debt can be reduced. D. To record the after-tax gain on the sale of KRII and KRIAG. CONDENSED CONSOLIDATED BALANCE SHEET AT DECEMBER 29, 1996 A. To eliminate the carrying value of KRII and KRIAG. B. To record $30.6 million of liabilities incurred or assumed and income taxes payable of $33.5 million relating to the sale of KRII and KRIAG. C. To record the use of proceeds to reduce long term borrowings by $434.6 million. These proceeds will be temporarily invested until such time that related debt can be reduced. D. To record the after-tax gain on the sale of KRII and KRIAG. NOTE B - HISTORICAL FINANCIAL STATEMENTS As of September 28, 1997, approximately $8 million of deferred income taxes were reclassified to net assets of discontinued BIS operations since they relate to operations that were discontinued. Page 5 of 7 Pages Item 7. (Continued) c. Exhibits The Stock Purchase Agreement between Knight-Ridder Business Information Services, Inc. and M.A.I.D. plc dated as of October 1, 1997 was filed with the Securities and Exchange Commission as an exhibit to KRI's Form 10-Q dated September 28, 1997. It is incorporated herein by reference. Page 6 of 7 Pages 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, thereto duly authorized. Dated: November 26, 1997 KNIGHT-RIDDER, INC. (Registrant) By: /s/ Gary R. Effren --------------------------------------- Gary R. Effren Vice President/Controller (Chief Accounting Officer and Duly Authorized Officer of Registrant) Page 7 of 7 Pages -----END PRIVACY-ENHANCED MESSAGE-----