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EXHIBIT (a)(2)
[MORGAN STANLEY DEAN WITTER LETTERHEAD]
August 27, 1998
Board of Directors
Berg Electronics Corp.
101 South Hanley Road
St. Louis, MO 63105
Members of the Board:
We understand that Berg Electronics Corp. (the "Company"), Framatome
Connectors International (the "Buyer") and Bravo Acquisition Corp., a wholly
owned subsidiary of Buyer ("Acquisition Sub"), have entered into an Agreement
and Plan of Merger, dated as of August 27, 1998 (the "Merger Agreement"), which
provides, among other things, for (i) the commencement by Acquisition Sub of a
tender offer (the "Tender Offer") for all outstanding shares of common stock,
par value $0.01 per share (the "Common Stock") of the Company for $35.00 per
share net to the seller in cash, and (ii) the subsequent merger (the "Merger")
of Acquisition Sub with and into the Company. Pursuant to the Merger, the
Company will become a wholly owned subsidiary of the Buyer and each outstanding
share of Common Stock, other than shares held in treasury or held by the Buyer
or any affiliate of the Buyer or as to which dissenters' rights have been
perfected, will be converted into the right to receive $35.00 per share in cash.
The terms and conditions of the Tender Offer and the Merger are more fully set
forth in the Merger Agreement.
You have asked for our opinion as to whether the consideration to be
received by the holders of shares of Common Stock pursuant to the Merger
Agreement is fair from a financial point of view to such holders.
For purposes of the opinion set forth herein, we have:
(i) reviewed certain publicly available financial statements and other
information of the Company;
(ii) reviewed certain internal financial statements and other
financial and operating data concerning the Company prepared by the
management of the Company;
(iii) analyzed certain financial projections prepared by the
management of the Company;
(iv) discussed the past and current operations and financial condition
and the prospects of the Company with senior executives of the Company;
(v) reviewed the reported prices and trading activity for the Common
Stock;
(vi) compared the financial performance of the Company and the prices
and trading activity of the Common Stock with that of certain other
comparable publicly-traded companies and their securities;
(vii) reviewed the financial terms, to the extent publicly available,
of certain comparable acquisition transactions;
(viii) participated in discussions and negotiations among
representatives of the Company and, the Buyer and their financial and legal
advisors;
(ix) reviewed the Merger Agreement and certain related documents; and
(x) performed such other analyses as we have deemed appropriate.
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[MORGAN STANLEY DEAN WITTER LETTERHEAD]
We have assumed and relied upon without independent verification the
accuracy and completeness of the information reviewed by us for the purposes of
this opinion. With respect to the financial projections, we have assumed that
they have been reasonably prepared on bases reflecting the best currently
available estimates and judgments of the future financial performance of the
Company. We have not made any independent valuation or appraisal of the assets
or liabilities of the Company, nor have we been furnished with any such
appraisals. Our opinion is necessarily based on economic, market and other
conditions as in effect on, and the information made available to us as of, the
date hereof.
We have acted as financial advisor to the Board of Directors of the Company
in connection with this transaction and will receive a fee for our services. In
the past, Morgan Stanley & Co. Incorporated and its affiliates have provided
financial advisory and financing services for the Company, the Buyer and their
affiliates and have received fees for the rendering of these services.
It is understood that this letter is for the information of the Board of
Directors of the Company, except that this opinion may be included in its
entirety in any filing made by the Company in respect of the transaction with
the Securities and Exchange Commission. Morgan Stanley expresses no opinion or
recommendation as to whether the shareholders of the Company should accept the
Tender Offer.
Based on the foregoing, we are of the opinion on the date hereof that the
consideration to be received by the holders of shares of Common Stock pursuant
to the Merger Agreement is fair from a financial point of view to such holders.
Very truly yours,
MORGAN STANLEY & CO.
INCORPORATED
By: /s/ R. BRADFORD EVANS
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R. Bradford Evans
Managing Director