1
EXHIBIT (b)(8)
PROJECT ORANGE
BOARD OF DIRECTORS MEETING
JUNE 24, 1997
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PROJECT ORANGE
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TABLE OF CONTENTS
JUNE 24, 1997
SECTION I EXECUTIVE SUMMARY
SECTION II FINANCIAL ANALYSIS
SECTION III VALUATION
SECTION IV TRANSACTION ISSUES
3
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EXECUTIVE SUMMARY
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4
PROJECT ORANGE
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OVERVIEW OF PRESENTATION
- Overview of process to date
- Announcement
- Formation of Independent Committee
- Formulation of Revised Plan
- Due diligence meeting and discussions
- Independent Committee's response to Proposal
- Summary of market reaction to Proposal
- Valuation update
- Changes in stock market
- Revised Management Plan
- Results of due diligence
- Business unit performance
- Process issues
- Next steps
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FINANCIAL ANALYSIS
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6
PROJECT ORANGE
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FRESH CLOSING STOCK PRICE AND VOLUME PRIOR TO ANNOUNCEMENT - 5 YEARS(1)
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FRESH'S SHARE PRICE APPRECIATED SIGNIFICANTLY IN 1995 AFTER 3 YEARS OF FLAT
PERFORMANCE
[GRAPHIC]
Graph depicts daily trading volume and per share price from 2/21/92 to 2/24/97.
Share price is initially approximately $38 per share, ranging from approximately
$30 to approximately $55 per share and ending at approximately $50 per share.
Note: (1) Historical prices adjusted for 2-for-1 stock split as of 05/02/95.
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PROJECT ORANGE
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FRESH STOCK PRICE AND VOLUME PERFORMANCE - LAST ONE YEAR
UPON ANNOUNCEMENT, FRESH TRADED ABOVE THE PROPOSAL PRICE
[GRAPHIC]
Graph depicts daily trading volume and per share price from 6/17/96 to 6/20/97.
Share price is initially approximately $55 per share, ranging from approximately
$47 to approximately $67 per share and ending at approximately $63 per share.
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PROJECT ORANGE
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FRESH RELATIVE STOCK PRICE PERFORMANCE - LAST FIVE YEARS PRIOR TO ANNOUNCEMENT
OVER THE LAST 5 YEARS, FRESH HAS TRADED IN LINE WITH THE COMMODITY CHEMICALS
PEER GROUP
[GRAPHIC]
Graph depicts indexed trading prices for Fina, S&P 500, and three indices
comprised of diversified refining and marketing companies, commodity chemical
companies and exploration and production companies.
Graph depicts share prices for Fina, S&P 500 and three indices from 2/19/92 to
2/14/97.
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PROJECT ORANGE
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PEER GROUP RELATIVE STOCK PRICE PERFORMANCE SINCE ANNOUNCEMENT
SINCE THE TRANSACTION ANNOUNCEMENT, THE COMPARABLES HAVE RISEN 5-10%, IN LINE
WITH THE OVERALL MARKET
[GRAPHIC]
Graph depicts S&P 500 and three indices (diversified refining and marketing,
commodity chemicals and exploration & production) from 2/25/97 through 6/13/97.
Such indices show varying levels of increase ranging from approximately 5% to
approximately 12%.
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PROJECT ORANGE
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CHANGE IN STOCK PRICES - FEBRUARY 25, 1997 TO JUNE 20, 1997
COMPARABLE COMPANIES 2/25/97 6/20/97 % CHANGE
- ----------------------------------------------- --------------- -------------- ---------------
Dow Chemical $80.50 $88.88 10.4%
Union Carbide 47.00 47.75 1.6%
Phillips Petroleum 42.50 43.38 2.1%
Murphy Oil 47.25 49.13 4.0%
Kerr-McGee 63.75 63.38 -0.6%
Ashland 43.50 47.38 8.9%
---------
Average: 4.4%
---------
RELEVANT INDUSTRY GROUPS (1)
- ---------------------------------------------
Large Cap. Energy Companies 9.0%
Commodity Chemicals Companies 5.1%
Large Cap. Exploration & Production Companies 5.1%
Refining & Marketing Companies 10.3%
Note:
(1) Composites of relevant industry participants.
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FRESH HISTORICAL AND PROJECTED FINANCIAL PERFORMANCE(1)
($MM)
- - Fresh's operating performance has improved the last 5 years and is
expected to continue to grow
- - Revised Plan in May reflects lower expectations of profitability for 1998
and 1999
EBITDA = OPERATING INCOME + BOOK CHARGES
- -----------------
CAGR(4)
----
'92 - '96: 14.4%
'96 - '99: 15.9%
'96 - '99: 14.4%
- -----------------
ACTUAL ($ MILLIONS)
- ------ ------------
1992 (2) $255.0
1993 $246.0
1994 $367.0
1995(3) $429.0
1996 $436.4
PROJECTED ($ MILLIONS)
- --------- ------------
1997 $456.2 $476.1
1998 $569.6 $549.7
1999 $679.9 $653.3
EBIT = OPERATING INCOME
- -----------------
CAGR(4)
----
'92 - '96: 40.5%
'96 - '99: 19.1%
'96 - '99: 15.9%
- -----------------
ACTUAL ($ MILLIONS)
- ------ ------------
1992 (2) $ 68.0
1993 $ 48.0
1994 $181.0
1995(3) $274.0
1996 $265.1
PROJECTED ($ MILLIONS)
- --------- ------------
1997 $271.3 $278.1
1998 $363.9 $336.4
1999 $447.5 $412.4
NET INCOME
- -----------------
CAGR(4)
----
'92 - '96: 58.8%
'96 - '99: 18.6%
'96 - '99: 14.7%
- -----------------
ACTUAL ($ MILLIONS)
- ------ ------------
1992 (2) $ 24.1
1993 $ 28.4
1994 $ 86.0
1995(3) $142.6
1996 $153.2
PROJECTED ($ MILLIONS)
- --------- ------------
1997 $155.1 $159.3
1998 $209.9 $191.3
1999 $255.5 $231.3
NOTES: (1) For fiscal years ending December 31, adjusted to exclude
extraordinary items.
(2) Excludes charge for adoption of FASB 106 OF $52.0MM pretax, $34.3MM
after-tax.
(3) Excludes charge for adoption of SFAS 121 of $58.7MM pretax, $38.2MM
after-tax.
(4) Compound Annual Growth Rate.
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FRESH HISTORICAL AND PROJECTED EBITDA BY SEGMENT
($MM)
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- Chemicals business exptected to rebound slowly after a down 1997
- Upstream performance expected to rebound in 1999
- Downstream projections expect sizable turnaround
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CHEMICALS
- -----------------
CAGR(2)
----
[S] [C]
'92 - '96: 21.0%
'96 - '99: 5.5%
'96 - '99: 1.6%
- -----------------
ACTUAL ($MILLIONS)
- ------
1992 $120.7
1993 $ 73.2
1994 $183.3
1995(1) $309.8
1996 $258.6
PROJECTED ($MILLIONS)
- ---------
1997 $225.8 $205.9
1988 $270.3 $243.0
1999 $303.9 $271.6
UPSTREAM
- -----------------
CAGR(2)
----
[S] [C]
'92 - '96: (1.1)%
'96 - '99: 12.7%
'96 - '99: 14.6%
- -----------------
ACTUAL ($MILLIONS)
- ------
1992 $148.2
1993 $227.5
1994 $ 83.1
1995(1) $ 50.0
1996 $141.3
PROJECTED
- ---------
1997 $118.2 $157.5
1988 $147.8 $156.0
1999 $202.4 $212.6
DOWNSTREAM
- -----------------
CAGR(2)
----
[S] [C]
'92 - '96: 34.0%
'96 - '99: 54.8%
'96 - '99: 53.5%
- -----------------
ACTUAL ($MILLIONS)
- ------
1992 $ 15.7
1993 $ 71.1
1994 $127.7
1995(1) $ 70.8
1996 $ 50.6
PROJECTED
- ---------
1997 $125.2 $125.7
1988 $165.1 $164.3
1999 $187.6 $183.0
Notes: (1) Adjusted for SFAS 121 charge allocation of $52.7MM to upstream and
$6.2MM to downstream.
(2) Compound Annual Growth Rate.
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VALUATION
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SUMMARY OF VALUATION APPROACHES
VALUE PER SHARE - JUNE 20, 1997
Pre
Announcement Adjusted February 25
Price(1) Price(2) Range
--------------- --------------- ---------------
TRADING VALUE $57-$62 $52-$60
PRECEDENT INDUSTRY TRANSACTIONS $59-$72 $58-$70
PRECEDENT MINORITY SQUEEZEOUTS (3) $63-$66 $60-$62
DISCOUNTED CASH FLOW
-MANAGEMENT REVISED CASE $67-$75 NA
-SENSITIVITY CASES $60-$63 NA
$63-$66
$66-$69
$69-$73
Notes: (1) Based on closing price of $50.13 as of February 25, 1997.
(2) Adjusted price of $53 reflects increase in overall stock market of
approximately 5%.
(3) Based on a 20-25% premium to Adjusted price.
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FRESH PUBLIC MARKET TRADING VALUATION ANALYSIS
COMPANY PRICE PER
CRITERIA STATISTIC(1) TRADING MULITIPLE RANGE IMPLIED EQUITY VALUE(2)(3) FULLY DULUTED SHARE (2)
- ------------------ ------------ ----------------------- -------------------------- ----------------------------
1997E
EBITDA $476 5.25 x - 5.50 x $1,811 - $1,930 $57.95 - $61.76
Cash Flow (4) 357 5.0 - 5.75 1,785 - 2,053 57.12 - 65.69
Net Income 159 11.0 - 12.0 1,751 - 1,910 56.04 - 61.14
------- ------- ------ ------
IMPLIED MEAN VALUES: $1,782 - $1,964 $57.04 - $62.86
IMPLIED MEDIAN VALUES: 1,785 - 1,930 57.12 - 61.76
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CURRENT MARKET PRICE (5): $50.13
MEDIAN VALUE PREMIUM (DISCOUNT) TO MARKET: 13.9% - 23.2%
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MEDIAN TRADING MULTIPLES
------------------------------------
1997E 1997E 1997E
EBITDA NET INCOME CASH FLOW
------ ------------ -----------
Large Cap. Energy Companies 5.7 x 17.1 x 6.0 x
Commodity chemicals Companies N/A 13.8 7.1
Large Cap. Exploration & Production Companies 6.2 28.6 5.6
Refining & Marketing Companies 6.9 16.7 6.3
Dow Chemical 6.1 12.0 6.8
Union Carbide 6.5 10.4 6.7
Phillips Petroleum 5.3 13.4 5.7
Murphy Oil 4.7 21.5 5.8
Kerr-McGee 4.9 15.8 5.2
Ashland 6.4 17.9 5.2
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Chosen Fresh Multiples 5.25-5.5 11.0-12.0 5.0-5.75
-----------------------------------------------------------------------------------------------
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Notes: (1) Adjusted for extraordinary items.
(2) 31.250MM fully diluted shares outstanding. Assumes 29.217MM Class
A and 2.000MM Class B common shares outstanding as of 4/28/97 from
the 3/31/97 10-Q and 0.032MM options outstanding at an average
exercise price of $35.25 as of 12/31/96 from the 12/1/96 10-K.
(3) Assumes debt of $695.5 MM and cash & equivalents of $8.2MM, as of
3/31/97.
(4) Cash flow defined as net income plus depreciation, depletion and
amortization.
(5) Closing share price as of 2/24/97.
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FRESH PRECEDENT TRANSACTION TRADING VALUATION ANALYSIS
COMPANY PRICE PER
CRITERIA STATISTIC(1) TRADING MULITIPLE RANGE IMPLIED EQUITY VALUE(2)(3) FULLY DULUTED SHARE (2)
- ------------------ ------------ ----------------------- -------------------------- ----------------------------
Last 12 Months
EBITDA $437 5.5 x - 6.5 x $1,713 - $2,149 $54.81 - $68.78
Cash Flow (4) 333 6.0 - 7.0 1,999 - 2,333 63.98 - 74.65
------ ------ ------ ------
IMPLIED MEAN VALUES: $1,856 - $2,241 $59.40 - $71.72
IMPLIED MEDIAN VALUES: 1,856 - 2,241 59.40 - 71.72
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CURRENT MARKET PRICE (5): $50.13
MEDIAN VALUE PREMIUM (DISCOUNT) TO MARKET: 18.5% - 43.1%
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REPRESENTATIVE PRECENDENT
TRANSACTION MULTIPLES
-------------------------
EBITDA CASH FLOW
------ -----------
Energy Companies 6-7 x 7-8 x
Commodity Chemicals Companies 5-6 5-7
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Chosen Fresh Multiples 5.5 - 6.5 x 6.0 - 7.0 x
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Notes: (1) Adjusted for extraordinary items.
(2) 31.250MM fully diluted shares outstanding. Assumes 29.217MM Class
A and 2.000MM Class B common shares outstanding as of 4/28/97 from
the 3/31/97 10-Q and 0.032MM options outstanding at an average
exercise price of $35.25 as of 12/31/96 from the 12/31/96 10-K.
(3) Assumes debt of $695.5 MM and cash & equivalents of $8.2MM, as of
3/31/97.
(4) Cash flow defined as net income plus depreciation, depletion and
amortization.
(5) Closing share price as of 2/24/97.
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PROJECT ORANGE
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DISCOUNTED CASH FLOW APPROACH
METHODOLOGY
- Standard Disounted Cash Flow (DCF) methodology utilized
- Assumes Revised Plan performance for 1997-1999; Sensitivity cases applied
to Revised Plan
- 2000-2001 estimates developed by growing 1999 EBIT by 10% annually versus
Revised Plan growth estimates of 20.1% in 2000 and 21.5% in 2001
- Discounted 5 years of free cash flows and calculated terminal value based
on a range of terminal year EBITDA multiples of 5.25-5.75x
- Weighted Average Cost of Capital (WACC) range of 10-12%, which is
developed from comparable WACCs of Commodity Chemicals, R&M, and E&P
companies
- Analyzed sensitivities to Revised Plan to reflect the risks inherent in
meeting Plan figures
- Highly volatile financial performance due to commodity businesses
- Historical results have varied significantly from Plan
- Uncontrollable elements of the Plan, which are volatile, have a large
part in determining the Company's future performance
- Exploration success in the Upstream business
- Refining margins in the Downstream business
- Margins in the Chemical business
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PROJECT ORANGE
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DISCOUNTED CASH FLOW ANALYSIS - CONSOLIDATED
UPDATED MANAGEMENT CASE
($MM, EXCEPT PER SHARE DATA)
EBITDA MULTIPLE 5.25x 5.50x 5.75x
------------------------ ------------------------ ------------------------
DISCOUNT RATE 10.0% 11.0% 12.0% 10.0% 11.0% 12.0% 10.0% 11.0% 12.0%
------ ------ ------ ------ ------ ------ ------ ------ ------
Present Value of
Cash Flows - Year 1 $ 57 $ 57 $ 57 $ 57 $ 57 $ 57 $ 57 $ 57 $ 57
Cash Flows - Years 2-5 506 490 475 506 490 475 506 490 475
Terminus 2,360 2,255 2,156 2,477 2,368 2,264 2,595 2,481 2,372
------ ------ ------ ------ ------ ------ ------ ------ ------
AGGREGATE VALUE $2,922 $2,802 $2,688 $3,040 $2,915 $2,796 $3,158 $3,028 $2,904
Cash $8 $8 $8 $8 $8 $8 $8 $8 $8
Preferred Stock 0 0 0 0 0 0 0 0 0
Total Debt(1) (696) (696) (696) (696) (696) (696) (696) (696) (696)
------ ------ ------ ------ ------ ------ ------ ------ ------
EQUITY VALUE $2,235 $2,115 $2,001 $2,353 $2,228 $2,109 $2,471 $2,340 $2,216
====== ====== ====== ====== ====== ====== ====== ====== ======
PRICE PER SHARE(2) $71.52 $67.67 $64.02 $75.29 $71.28 $67.47 $79.07 $74.89 $70.92
Premium (Discount) to Market(3) 42.7% 35.0 27.7% 50.2% 42.2% 34.6% 57.7% 49.4% 41.5%
1997E P/E Implied 14.0 x 13.3 x 12.6 x 14.8 x 14.0 x 13.2 x 15.5 x 14.7 x 13.9 x
TERMINAL VALUE ANALYSIS
% Value Terminus 80.7% 80.5% 80.2% 81.5% 81.2% 81.0% 82.2% 81.9% 81.7%
% Value in Cash Flows 19.3% 19.5% 19.8% 18.5% 18.8% 19.0% 17.8% 18.1% 18.1%
Implied Terminal P/E 12.7 x 12.7 x 12.7 x 13.3 x 13.3 x 13.3 x 13.9 x 13.9 x 13.9 x
Notes: (1) Debt as of March 31, 1997.
(2) Based on 31.2MM common shares outstanding on 04/28/97 from the
03/31/97 10-Q and 0.03MM options outstanding at an average exercise
price of $35.25 on 12/31/96 from the 12/31/96 10-K.
(3) Based on the closing share price of $50.13 on 2/24/97.
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PROJECT ORANGE
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DISCOUNTED CASH FLOW APPROACH - SENSITIVITY CASES
- - Sensitivity cases were analyzed to view the impact on profitability of
various perceived areas of risk to the Plan such as:
- Overall EBIT growth of the business
- Profitability of the Downstream business (Return on Capital Employed)
- Growth rate of Upstream EBIT (success of long-term Exploration
activities)
- - Each sensitivity case reflects a discrete change to Revised Plan and is
based on discount rates of 10-12%
SENSITIVITY CASE #1
- ----------------------------------------
- - Overall 1998-2001 EBIT growth
of 9.0% annually versus plan
growth of 21.3%
- Approximates median long-term
projected growth rate for
comparables
REPRESENTATIVE RANGE
- ----------------------------------------
$60-63 / Share
SENSITIVITY CASE #2
- ----------------------------------------
- - Profitability of Downstream business
reduced to 5.0% ROCE annually in
1998-2001 versus plan of 6.1% in 1998
increasing to 9.9% in 2001
- In line with comps median of 5.2%
historical ROCE
- Management admitted that achieving
Plan in Downstream is a "challenge"
REPRESENTATIVE RANGE
- ----------------------------------------
$63-69 / Share
SENSITIVITY CASE #3
- ----------------------------------------
- - EBIT growth of Upstream businesses
reduced to 10.0% annually from 1999-
2001 versus plan growth of 25.5%
- Sensitivity for the success rate
of exploration activities
REPRESENTATIVE RANGE
- ----------------------------------------
$66-73 / Share
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COMPARISON OF EBITDA PROJECTIONS (1)
($MM)
PROJECTED COMPOUNDED
--------------------------------------------------- GROWTH
1997 1998 1999 2000 2001 1996 - 2001
-------- -------- -------- -------- -------- ---------------
FRESH MANAGEMENT CASES
Management Plan (December 1996) $456.2 $569.6 $679.9 NA NA NA
Revised 5-Year Plan (May 1997) 476.1 549.7 653.2 746.3 859.7 14.5%
MORGAN STANLEY ADJUSTED CASES
Updated Management Case $476.1 $549.7 $653.2 $706.2 $760.0 11.7%
Sensitivity Case 1 476.1 517.3 573.5 614.9 655.8 8.5%
Sensitivity Case 2 476.1 533.6 620.2 659.5 697.4 9.8%
Sensitivity Case 3 476.1 549.7 620.8 670.5 720.8 10.6%
NOTE:
(1) EBITDA = Operating income + Book Charges
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TRANSACTION ISSUES
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PROJECT ORANGE
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TRANSACTION FINANCIAL ISSUES
- - Transaction premium in relation to historical price
- Historical minority squeeze out transactions typically range from 20 to 25%
over the unaffected stock price of the target, average transaction premium
is 27% over the unaffected price
- - Value of dividend paid to minority shareholders
- - Impact of transaction on Pure earnings and cash flow
- Financing costs
- Amortization of goodwill
- Fresh dividends
- - Stock vs. cash transaction
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PROJECT ORANGE
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FRESH VALUATION MATRIX (1)
($MM, EXCEPT PER SHARE DATA)
EQUITY VALUE/
PURCHASE ------------------------------------------------------
SHARE EQUITY AGGREGATE VALUE OF 1996 1997E 1996 1997E
PRICE VALUE (2) VALUE (3) MINORITY (4) EARNINGS EARNINGS CASH FLOW CASH FLOW
- ------- ----------- ------------ -------------- ---------- ---------- ----------- -----------
$153 $159 $325 $357
$48.00 $1,499 $2,186 $213 9.8 x 9.4 x 4.6 x 4.2 x
- -----------------------------------------------------------------------------------------------------------------------
50.00 1,561 2,249 221 10.2 9.8 4.8 4.4
- -----------------------------------------------------------------------------------------------------------------------
52.00 1,624 2,311 230 10.6 10.2 5.0 4.5
54.00 1,686 2,374 239 11.0 10.6 5.2 4.7
56.00 1,749 2,436 248 11.4 11.0 5.4 4.9
58.00 1,811 2,499 257 11.8 11.4 5.6 5.1
- -----------------------------------------------------------------------------------------------------------------------
60.00 1,874 2,561 266 12.2 11.8 5.8 5.2
- -----------------------------------------------------------------------------------------------------------------------
62.00 1,936 2,624 275 12.6 12.2 6.0 5.4
64.00 1,999 2,686 284 13.0 12.6 6.2 5.6
66.00 2,061 2,749 293 13.5 13.0 6.4 5.8
68.00 2,124 2,811 302 13.9 13.3 6.5 5.9
70.00 2,186 2,874 311 14.3 13.7 6.7 6.1
72.00 2,249 2,936 319 14.7 14.1 6.9 6.3
74.00 2,311 2,999 328 15.1 14.5 7.1 6.5
76.00 2,374 3,061 337 15.5 14.9 7.3 6.6
78.00 2,436 3,124 346 15.9 15.3 7.5 6.8
80.00 2,499 3,186 355 16.3 15.7 7.7 7.0
AGGREGATE VALUE/ PREMIUM TO
- ----------------------------------------------- -------------------------------
1996 1997E 1996 1997E UNAFFECTED ALL TIME
EBITDA EBITDA EBIT EBIT PRICE (6) HIGH (7)
- -------- -------- ------ ------- ---------- ----------
$436 $476 $265 $278 $50.13 $55.50
5.0 x 4.6 x 8.3 x 7.9 x -4.2% -13.5%
- --------------------------------------------------------------------------------------
5.2 4.7 8.5 8.1 -0.2% -9.9%
- --------------------------------------------------------------------------------------
5.3 4.9 8.7 8.3 3.7% -6.3%
5.4 5.0 9.0 8.5 7.7% -2.7%
5.6 5.1 9.2 8.8 11.7% 0.9%
5.7 5.2 9.4 9.0 15.7% 4.5%
- --------------------------------------------------------------------------------------
5.9 5.4 9.7 9.2 19.7% 8.1%
- --------------------------------------------------------------------------------------
6.0 5.5 9.9 9.4 23.7% 11.7%
6.2 5.6 10.1 9.7 27.7% 15.3%
6.3 5.8 10.4 9.9 31.7% 18.9%
6.4 5.9 10.6 10.1 35.7% 22.5%
6.6 6.0 10.9 10.3 39.7% 26.1%
6.7 6.2 11.1 10.6 43.6% 29.7%
6.9 6.3 11.3 10.8 47.6% 33.3%
7.0 6.4 11.6 11.0 51.6% 36.9%
7.2 6.6 11.8 11.2 55.6% 40.5%
7.3 6.7 12.0 11.5 59.6% 44.1%
Notes: (1) Fresh financial information adjusted to exclude extraordinary items.
(2) Based on 29.2MM Class A and 2.0MM Class B common shares outstanding
on 4/28/97 from the 3/31/97 10-Q and 0.032MM options outstanding
with an average exercise price of $35.25 on 12/31/96 from the
12/31/96 10-K.
(3) Includes total debt of $695.5MM less cash of $8.2MM as of March 31,
1997.
(4) Based on public float of 4.420MM Class A shares, 0.032MM options and
options proceeds of $1.1MM.
(5) Cash flow defined as net income plus depreciation, depletion and
amortization.
(6) Based on share price as of February 24, 1997.
(7) All-time high achieved on July 1, 1996.
24
PROJECT ORANGE
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PRO FORMA IMAPCT ON PURE
A TRANSACTION WOULD LIKELY BE SLIGHTLY ACCRETIVE TO PURE'S E.P.S.
1996 ACTUAL
-----------------------------
EXAMPLE: $60.00 OFFER PRICE
(19% PREMIUM) 100% CASH 100 STOCK
- --------------------------- --------- ---------
(MM) (MM)
Pure Net Income (BEF) 16,000 16,000
Pure Net Income (US$)(1) $470.6 $470.0
Pure EPS(2) $20.24 $20.24
Plus: Fresh Minority Interest(3) 21.7 21.7
Less: Goodwill(4) (6.0) (6.0)
Less: A/T Interest Expense(3) (12.1) (0.0)
----------- -----------
Pro Foma Net Income(US$) $474.2 $486.3
Shares(6) 23,252,863 23,951,815
PRO FORMA EPS $20.39 20.30
- ---------------------------------------------------------------
% ACCRETION/(DILUTION) 0.8% 0.3%
- ---------------------------------------------------------------
[GRAPHIC]
Notes: (1) Assumes an exchange rate of 34.00 BEF/$US.
(2) Based on 23,252,863 Pure shares outstanding as of 12/31/96.
(3) Based on Fresh net income of $153.2 and minority interest of 14.2%.
(4) Purchase accounting assumed for pro rata portion of Fresh. Goodwill
is amortized over 15 years.
(5) Assumes a cost of debt of 7.0% and a tax rate of 35%. Total funding
equals $266MM.
(6) In 100% stock case, assumes shares issued at Pure share price of
12,950 BEF (US $380.88) as of 6/16/97.
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