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) June 25, 1995
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Travelers Group Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-9924 52-1568099
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
388 Greenwich Street, New York New York 10013
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(Address of principal executive offices) (Zip Code)
(212) 816-8000
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(Registrant's telephone number, including area code)
TRAVELERS GROUP INC.
Current Report on Form 8-K
Item 5. Other Events.
On June 25, 1995, The Travelers Insurance Group Inc.
("TIGI") and The Travelers Insurance Company ("TIC"), both wholly owned
subsidiaries of Travelers Group Inc. ("Travelers"), entered into a definitive
agreement with MetLife HealthCare Holdings, Inc. ("MHH"), a subsidiary of
Metropolitan Life Insurance Company ("MetLife"), The MetraHealth Companies, Inc.
("MetraHealth") and United HealthCare Corporation ("United") and its acquisition
subsidiary for the acquisition by merger of MetraHealth by United. The
Travelers entities and MHH each own 48.25% of MetraHealth.
The terms of the transaction call for United to pay initial
consideration to the stockholders of MetraHealth of $1.65 billion, of which
$1.15 billion is to be paid in cash and $500 million is to be paid in the form
of convertible preferred stock of United. In addition, United will pay up to
$350 million to the MetraHealth stockholders, based on the operating results of
MetraHealth for 1995. In the event that Company Earnings (as that term is
defined in the merger agreement) of MetraHealth for 1995 are at least $190
million, the stockholders of MetraHealth will be entitled to receive the full
contingency payment. If Company Earnings for 1995 are less than $190 million,
the contingency payment will be reduced ratably, and no payment will be due if
such earnings are $155 million or less. The merger agreement provides that
United will also pay two additional payments to the stockholders of MetraHealth
of up to $175 million each based on the earnings of the combined MetraHealth and
United for 1996 and 1997. In a related agreement, the Travelers entities have
agreed to sell their right to the 1996 and 1997 additional payments to the
MetLife entities for $35 million.
According to the terms of the merger agreement, the
Travelers entities have elected to receive all cash for their portion of the
initial consideration, and accordingly will receive a total of $831 million as a
result of the merger and the related sale to the MetLife entities of the
Travelers entities' share of the 1996 and 1997 additional payments. In
addition, the Travelers entities will receive up to $169 million if a
contingency payment for 1995 is made. Of these amounts, TIC will be entitled to
receive approximately $708 million of the initial consideration and $144 million
of the contingent consideration, with the balance to be received by TIGI.
The Boards of Directors of the Travelers entities and of
MetLife and United have approved the merger. The merger is subject to customary
regulatory approvals, including approvals from a number of state insurance
commissions.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit No. Description
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99.01 Unaudited Pro Forma Consolidated Financial
Information.
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 hereunto duly authorized.
Dated: June 29, 1995 TRAVELERS GROUP INC.
By: /s/ Irwin R. Ettinger
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Irwin R. Ettinger
Senior Vice President