-----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, J5VqvCt9rKMSBwL9uVww3UsmkmA3u+WJXOKZrx4idGtR5nsuo4Zhzu9a3txfguv5 vsEJxoI44LJGM7bxwULEsg== 0000950150-99-000158.txt : 19990215 0000950150-99-000158.hdr.sgml : 19990215 ACCESSION NUMBER: 0000950150-99-000158 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990129 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BELL INDUSTRIES INC /NEW/ CENTRAL INDEX KEY: 0000945489 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-ELECTRONIC PARTS & EQUIPMENT, NEC [5065] IRS NUMBER: 952039211 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-11471 FILM NUMBER: 99538205 BUSINESS ADDRESS: STREET 1: 2201 E EL SEGUDON BLVD CITY: EL SEGUNDO STATE: CA ZIP: 90245 BUSINESS PHONE: 3105632355 MAIL ADDRESS: STREET 1: 2201 E EL SEGUDON BLVD CITY: EL SEGUDON STATE: CA ZIP: 90245 FORMER COMPANY: FORMER CONFORMED NAME: CALIFORNIA BELL INDUSTRIES INC DATE OF NAME CHANGE: 19950519 8-K 1 FORM 8-K 1 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): January 29, 1999 BELL INDUSTRIES, INC. (Exact name of registrant as specified in charter) California 1-11471 95-2039211 - -------------------------------------------------------------------------------- (State of incorporation) (Commission File Number) (IRS Identification No.) 2201 E. El Segundo Boulevard El Segundo, CA 90245 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (310) 563-2355 N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) 2 ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS On January 29, 1999, Bell Industries, Inc., a California corporation ("Bell" or the "Registrant") sold its Electronics Distribution Group ("EDG") to Arrow Electronics, Inc., a New York corporation. EDG sells electronic components to approximately 10,000 customers in North America, including: semiconductors, passive components, connectors, and board-level products. EDG also provides various value added services. The purchase price is approximately $185 million, subject to post closing adjustments. A portion of the proceeds from the sale were used to repay Bell's bank debt. The remaining proceeds will be used to pay taxes and expenses related to the sale and to make a distribution to Bell's shareholders. The sale of EDG was structured as a sale of substantially all the assets of EDG's operations. The purchase price was determined based on negotiations between the parties. 3 Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (b) Pro forma financial information. Attached on Exhibit (99.1) is unaudited pro forma financial information for the Registrant. (c) Exhibits (99.1) Unaudited pro forma financial information for the Registrant. SIGNATURES 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 hereunto duly authorized. BELL INDUSTRIES, INC. Date: February 11, 1999 By: /s/ RUSSELL A. DOLL ------------------------------- Russell A. Doll Vice President - Chief Financial Officer EX-99.1 2 UNAUDITED PRO FORMA FINANCIAL INFORMATION 1 Exhibit (99.1) Page 1 of 9 BELL INDUSTRIES, INC. Pro Forma Financial Information (Unaudited) The following unaudited pro forma financial statements give effect to the sale of EDG and distribution in an assumed amount of $55 million to shareholders. Therefore, such statements present pro forma financial information regarding Bell without EDG, and after the assumed distribution to shareholders. The pro forma balance sheet assumes that the sale of EDG and the distribution to shareholders occurred on September 30, 1998, while the pro forma statements of operations assume that the sale of EDG and the distribution to shareholders occurred on January 1, 1995. The pro forma financial statements should be read in conjunction with the historical consolidated financial statements of Bell included in the Bell Industries, Inc., Annual Report on Form 10-K for the year ended December 31, 1997. The Company expects its corporate costs will be substantially lower following the sale of EDG, and it will endeavor to restructure its operations to realize these savings. The pro forma financial statements do not reflect such cost savings, nor those expected to be achieved following the sale of Bell's Graphics Imaging Group ("Graphics") on September 14, 1998. Accordingly, these pro forma operating results are not indicative of operating results which would have been achieved had the sale of EDG been consummated as of the dates presented and should not be construed as representative of future operations. 2 Exhibit (99.1) Page 2 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA BALANCE SHEET SEPTEMBER 30, 1998 (IN THOUSANDS)
ELECTRONICS DISTRIBUTION PRO FORMA HISTORICAL GROUP(a) ADJUSTMENTS PRO FORMA ---------- ------------ ----------- --------- ASSETS Current assets: Cash and cash equivalents...... $ 4,957 $ 50,372 (b) $ 329 (55,000)(c) Accounts receivable, net....... 89,033 $ (60,328) 28,705 Net receivable from sale of Graphics.................... 12,257 12,257 Inventories.................... 131,064 (114,936) 16,128 Prepaid expenses and other..... 11,052 (559) 10,493 -------- --------- ------- Total current assets... 248,363 (175,823) 67,912 -------- --------- ------- Properties, net.................. 35,215 (17,582) 17,633 Goodwill......................... 67,540 (65,780) 1,760 Other assets..................... 9,411 (50) 9,361 -------- --------- ------- $360,529 $(259,235) $96,666 ======== ========= ======= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable............... $ 51,799 $ (26,787) $25,012 Accrued liabilities and payroll..................... 27,315 (4,582) 22,733 Current portion of long-term liabilities................. 9,375 (9,375)(b) Income taxes payable........... 9,000 (b) 9,000 -------- --------- ------- Total current liabilities......... 88,489 (31,369) 56,745 -------- --------- ------- Long-term debt................... 114,710 (6,457) (108,253)(b) Deferred compensation and other.......................... 7,105 7,105 Investment in EDG................ (221,409) 221,409 (b) Shareholders' equity............. 150,225 (62,409)(b) 32,816 (55,000)(c) Commitments and contingencies -------- --------- ------- $360,529 $(259,235) $96,666 ======== ========= =======
See accompanying Notes to Unaudited Pro Forma Financial Statements. 3 Exhibit (99.1) Page 3 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 1998 (IN THOUSANDS, EXCEPT PER SHARE DATA)
ELECTRONICS DISTRIBUTION PRO FORMA HISTORICAL GROUP(a) ADJUSTMENTS PRO FORMA(f) ---------- ------------ ----------- ------------ Net sales..................... $521,172 $(360,337) $160,835 -------- --------- -------- Costs and expenses Cost of products sold....... 414,982 (286,961) 128,021 Selling and administrative........... 83,745 (55,580) 28,165 Depreciation and amortization............. 6,995 (3,477) 3,518 Interest.................... 9,667 $(9,667)(d) Business system and corporate resizing charges.................. 13,800 (3,900) 9,900 -------- --------- -------- 529,189 349,918 169,604 -------- --------- -------- Loss from continuing operations before income taxes....................... (8,017) (10,419) (8,769) Income tax benefit............ (1,732) (4,873) 2,922 (e) (3,683) -------- --------- -------- Loss from continuing operations.................. $ (6,285) $ (5,546) $ (5,086) ======== ========= ======== SHARE AND PER SHARE DATA: Loss from continuing operations Basic.................. $ (0.67) $ (0.54) ======== ======== Diluted................ $ (0.67) $ (0.54) ======== ======== Weighted average shares outstanding Basic.................. 9,385 9,385 ======== ======== Diluted................ 9,385 9,385 ======== ========
See accompanying Notes to Unaudited Pro Forma Financial Statements. 4 Exhibit (99.1) Page 4 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 1997 (IN THOUSANDS, EXCEPT PER SHARE DATA)
ELECTRONICS DISTRIBUTION PRO FORMA HISTORICAL GROUP(a) ADJUSTMENTS PRO FORMA(f) ---------- ------------ ----------- ------------ Net sales........................ $559,523 $(409,324) $150,199 -------- --------- -------- Costs and expenses Cost of products sold.......... 434,502 (317,844) 116,658 Selling and administration..... 93,255 (65,186) 28,069 Depreciation and amortization................ 6,937 (3,265) 3,672 Interest....................... 8,810 $(8,810)(d) Integration charge............. 4,100 (4,100) -------- --------- -------- 547,604 (390,395) 148,399 -------- --------- -------- Income from continuing operations before income taxes............ 11,919 (18,929) 1,800 Income tax provision............. 5,715 (9,076) 4,117(e) 756 -------- --------- -------- Income from continuing operations..................... $ 6,204 $ (9,853) $ 1,044 ======== ========= ======== SHARE AND PER SHARE DATA: Income from continuing operations Basic..................... $ 0.68 $ 0.11 ======== ======== Diluted................... $ 0.66 $ 0.11 ======== ======== Weighted average shares outstanding Basic..................... 9,118 9,118 ======== ======== Diluted................... 9.401 9,401 ======== ========
See accompanying Notes to Unaudited Pro Forma Financial Statements. 5 EXHIBIT (99.1) Page 5 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1997 (IN THOUSANDS, EXCEPT PER SHARE DATA)
ELECTRONICS DISTRIBUTION PRO FORMA HISTORICAL GROUP(a) ADJUSTMENTS PRO FORMA(f) ---------- ------------ ----------- ------------ Net sales $734,449 $(539,808) $194,641 -------- --------- -------- Costs and expenses Cost of products sold....... 571,344 (420,589) 150,755 Selling and administrative........... 123,158 (85,605) 37,553 Depreciation and amortization............. 9,196 (4,370) 4,826 Interest.................... 12,309 $ (12,309)(d) Integration charge.......... 4,100 (4,100) -------- --------- -------- 720,107 (514,664) 193,134 -------- --------- -------- Income from continuing operations before income taxes....................... 14,342 (25,144) 1,507 Income tax provision.......... 6,823 (11,962) 5,772(e) 633 -------- --------- -------- Income from continuing operations.................. $ 7,519 $ (13,182) $ 874 ======== ========= ======== SHARE AND PER SHARE DATA: Income from continuing operations Basic.................. $ .82 $ 0.10 ======== ======== Diluted................ $ .80 $ 0.09 ======== ======== Weighted average shares outstanding Basic.................. 9,157 9,157 ======== ======== Diluted................ 9,430 9,430 ======== ========
See accompanying Notes to Unaudited Pro Forma Financial Statements. 6 Exhibit (99.1) Page 6 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1996 (IN THOUSANDS, EXCEPT PER SHARE DATA)
ELECTRONICS DISTRIBUTION HISTORICAL GROUP(a) PRO FORMA(f) ---------- ------------ ------------ Net sales.................................. $506,062 $(327,354) $178,708 -------- --------- -------- Cost and expenses Costs of products sold................... 387,876 (250,978) 136,898 Selling and administration............... 84,924 (51,256) 33,668 Depreciation and amortization............ 5,736 (1,380) 4,356 Interest................................. 3,673 3,673 -------- --------- -------- 482,209 (303,614) 178,595 -------- --------- -------- Income from continuing operations before income taxes...................... 23,853 (23,740) 113 Income tax provision....................... 9,992 (9,945) 47 -------- --------- -------- Income from continuing operations.......... $ 13,861 $ (13,795) $ 66 ======== ========= ======== SHARE AND PER SHARE DATA: Income from continuing operations Basic............................... $ 1.57 $ 0.01 ======== ======== Diluted............................. $ 1.52 $ 0.01 ======== ======== Weighted average shares outstanding Basic............................... 8,852 8,852 ======== ======== Diluted............................. 9,109 9,109 ======== ========
See accompanying Notes to Unaudited Pro Forma Financial Statements. 7 Exhibit (99.1) Page 7 of 9 BELL INDUSTRIES, INC. UNAUDITED PRO FORMA STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1995 (IN THOUSANDS, EXCEPT PER SHARE DATA)
ELECTRONICS DISTRIBUTION HISTORICAL GROUP(a) PRO FORMA(f) ---------- ------------ ------------ Net sales.................................. $490,966 $(346,087) $144,879 -------- --------- -------- Cost and expenses Costs of products sold................... 375,168 (267,573) 107,595 Selling and administration............... 82,863 (52,048) 30,815 Depreciation and amortization............ 5,755 (1,242) 4,513 Interest................................. 3,612 3,612 Lease commitment provision............... 2,800 2,800 Gain on sale of division................. (3,050) (3,050) -------- --------- -------- 467,148 (320,863) 146,285 -------- --------- -------- Income (loss) from continuing operations before income taxes...................... 23,818 (25,224) (1,406) Income tax provision (benefit)............. 10,008 (10,599) (591) -------- --------- -------- Income (loss) from continuing operations... $ 13,810 $ (14,625) $ (815) ======== ========= ======== SHARE AND PER SHARE DATA: Income (loss) from continuing operations Basic............................... $ 1.56 $ (0.09) ======== ======== Diluted............................. $ 1.52 $ (0.09) ======== ======== Weighted average shares outstanding Basic............................... 8,852 8,852 ======== ======== Diluted............................. 9,109 9,109 ======== ========
See accompanying Notes to Unaudited Pro Forma Financial Statements. 8 Exhibit (99.1) Page 8 of 9 BELL INDUSTRIES, INC. NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS (a) Represents the elimination of the historical accounts of EDG for each of the periods presented. (b) Represents estimated proceeds of $185 million from the sale of EDG, the use of proceeds to extinguish all outstanding borrowings and the payment of approximately $17 million of estimated selling costs including severance payments. Additionally, reflects the elimination of the investment in EDG and records a loss of approximately $62.4 million on the sale of EDG including estimated selling costs and taxes. The final purchase price is subject to post closing adjustments. The loss has not been included in the pro forma statements of income for the periods presented. The following is a summary of the net pro forma cash entry at September 30, 1998: Estimated gross proceeds.................................... $ 185,000 Estimated selling costs..................................... (17,000) --------- Estimated net proceeds...................................... 168,000 Repayment of outstanding borrowings......................... (117,628) --------- Net cash.................................................... $ 50,372 =========
(c) Represents the distribution of $55 million of cash to shareholders. The pro forma presentation does not reflect the planned second cash distribution that is subject to the timing and completion of the disposition of certain real estate assets. The amount of the second distribution is estimated to be $10 million to $15 million and is expected to be paid in late 1999. (d) Represents the elimination of consolidated interest expense for the period assuming the net estimated cash proceeds are utilized to reduce long-term debt as required by Bell's borrowing agreement. (e) Adjusts income tax expense for the effect of the pro forma adjustments based on the effective tax rate for the period presented. 9 Exhibit (99.1) Page (9 of 9) BELL INDUSTRIES, INC. NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS (f) Unaudited pro forma financial data for each of the Remaining Businesses is as follows:
NINE MONTHS ENDED SEPTEMBER 30 YEAR ENDED DECEMBER 31 ------------------- ------------------------------ 1998 1997 1997 1996 1995 -------- -------- -------- -------- -------- Net sales Computer systems integration.............. $110,289 $ 94,558 $124,680 $112,953 $ 73,742 Recreational products....... 37,897 36,389 46,234 43,704 42,576 Electronics manufacturing... 12,649 19,252 23,727 22,051 28,561 -------- -------- -------- -------- -------- $160,835 $150,199 $194,641 $178,708 $144,879 ======== ======== ======== ======== ======== Operating income Computer systems integration.............. $ 5,227 $ 4,516 $ 5,933 $ 5,692 $ 2,897 Recreational products....... 2,717 2,452 2,880 3,380 3,536 Electronics manufacturing... 1,597 3,412 4,230 3,613 7,329 Corporate costs............. (8,410) (8,580) (11,536) (8,899) (8,756) -------- -------- -------- -------- -------- 1,131 1,800 1,507 3,786 5,006 Interest.................... (3,673) (3,612) Business system and corporate resizing charges.................. (9,900) Lease commitment provision................ (2,800) Income tax (provision) benefit..................... 3,683 (756) (633) (47) 591 -------- -------- -------- -------- -------- Income (loss) from continuing operations.................. $ (5,086) $ 1,044 $ 874 $ 66 $ (815) ======== ======== ======== ======== ========
The pro forma selling and administrative expenses include the historical corporate costs for the entire Company, including those costs required to support EDG and Graphics. The Company expects corporate costs will be substantially lower following the sale of EDG, and will restructure its operations to realize these savings. These anticipated savings are not reflected in the pro forma presentation. Management expects these annual savings to be approximately $8 million to $9 million, before tax effects, after a restructuring of the Company's operations following the sale of EDG to bring corporate costs in-line with the Company's smaller size. -----END PRIVACY-ENHANCED MESSAGE-----