1
Exhibit (b)(3)
[GRAPHIC]
PROJECT POWERHOUSE
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Discussion Materials
September 21, 1999
MORGAN STANLEY DEAN WITTER
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Table of Contents
SECTION I EXECUTIVE SUMMARY
SECTION II STOCK PRICE PERFORMANCE
SECTION III PROJECTIONS AND DISCOUNTED CASH FLOW ANALYSIS
SECTION IV PRECEDENT TRANSACTIONS
SECTION V SHAREHOLDING AND TRADING ANALYSIS
SECTION VI ADDITIONAL PRICING CONSIDERATIONS
APPENDICES A SUMMARY TIMETABLE
B COMPARABLE COMPANY ANALYSIS
C PRECEDENT JAPANESE TRANSACTIONS
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EXECUTIVE SUMMARY
BACKGROUND
----------
- We have been asked to provide our views as to the appropriate price
that the families should be prepared to pay to acquire all of the
publicly held shares of Apple and Juniper
- We have reviewed forecasts for Apple and Juniper
-- based on the review of the forecasts and discussions with the
Apple and Juniper management teams, we believe the projections
have been prepared on a reasonable basis and reflect
management's best estimate of the future financial results of
Apple and Juniper
- Based on these forecasts, we have performed discounted cash flow
("DCF") analyses for both Apple and Juniper
- We have examined the trading performance of other publicly traded
companies that operate businesses similar to Apple and Juniper
- We have reviewed other transactions in which a majority shareholder
acquires all of the outstanding minority shares over the past
decade; most of those transactions have occurred in the United
States
- We have examined the trading prices and volume of Apple and Juniper
shares over the past several years
- We have examined the estimate of additional cash flow synergies
available to the families following the completion of Project
Powerhouse
- Acorn management has also outlined the strategies and financial
benefits of taking Apple and Juniper private as a precursor to a
potential public offering of a more comprehensive set of Acorn
assets
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EXECUTIVE SUMMARY (CONTINUED)
PRELIMINARY CONCLUSIONS
- -----------------------
- - The discounted cash flow analysis leads us to conclude that the Apple and
Juniper shares are trading at values in line with their DCF value
- - To acquire shares in the tender offer, the families will need to pay a
meaningful premium over the current trading prices
- - To justify paying a premium, the families must be willing to share a
portion of any expected financial benefits (i.e., synergies) derived from
taking the entities private
- - Morgan Stanley believes the families should be willing to share a
substantial portion of these benefits because of the overriding strategic
value of a Mothership transaction and the value which can be unlocked from
other Acorn assets
- - Additionally, the families should seek to pay a price that mitigates, to
the extent possible, negative reaction from shareholders and the press.
However, it is highly likely that some degree of negative
reaction/publicity will occur because of the nature of the transaction
-- there is greater likelihood of a negative reaction to the Juniper
transaction because even a price which is at a substantial premium
to the market is well below the IPO price and the prices where
secondary offerings were completed several years ago
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EXECUTIVE SUMMARY (CONTINUED)
RECOMMENDATION
- --------------
- - We recommend that the families make an initial offer that represents
roughly a 30% premium over the current trading prices for Apple and
Juniper. That premium is consistent with the median premia paid in similar
transactions since 1987. Specifically, we recommend per share offer prices
of:
Apple - $15.00, a 27.7% premium to the current price of $11.75
Juniper - 1450 YEN, a 33.0% premium to the current price of 1090 YEN
- - It is important to note that Apple shares have not closed above $15 per
share since July 31, 1998 and Juniper shares have not closed above 1450
YEN since August 26, 1998
EXPECTATION
- -----------
- - We would expect that the Apple and Juniper Boards, along with their
financial advisors, will argue that a higher price should be paid. Our
strategy is to maintain flexibility to increase the offer prices if
circumstances dictate that to be advisable.
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SECTION II
STOCK PERFORMANCE
- - Both Apple and Juniper stocks are well below their all-time highs
- - The stocks have underperformed broad market indices as well as a composite
of comparable companies
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Stock Price Performance for Apple
Since IPO
Graph displaying daily share price and trading volume for Amway Asia Pacific
from December 15, 1993 to September 17, 1999. Exhibit highlights the current
price of $11.75, 52-week high of $14.44 and 52-week low of $7.13.
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Apple Indexed Stock Price Performance
September 17, 1997 to September 17, 1999
Graph displaying indexed share price performance for Amway Asia Pacific from
September 17, 1997 to September 17, 1999. Graph compares Amway Asia Pacific
share price performance to the S&P 500, the Hang Seng Index and a market
capitalization weighted index of comparable companies including: Avon Products,
Blyth, Enesco Group, Fingerhut, Land's End, Nature's Sunshine, Newell
Rubbermaid, Nu Skin and Tupperware. Exhibit highlights the following rates of
return over the time period specified:
Amway Asia Pacific: (61.6%)
S&P 500: 41.6%
Hang Seng Index: (6.4%)
Comparable Companies: 3.4%
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Stock Price Performance for Juniper
Since IPO
Graph displaying daily share price and trading volume for Amway Japan from June
6, 1991 to September 17, 1999. Exhibit highlights the current price of 1,090
yen, 52-week high of 1,420 yen and 52-week low of 915 yen.
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Juniper Indexed Stock Price Performance
September 17, 1997 to September 17, 1999
Graph displaying indexed share price performance for Amway Japan from September
17, 1997 to September 17, 1999. Graph compares Amway Japan share price
performance to the Nikkei Index, S&P 500, and a market capitalization weighted
index of Japanese comparable companies including: Senshukai, Cecile, Nissen,
Mutow, Charle, Shaklee and Avon Products. Exhibit highlights the following rates
of return over the time period specified:
Amway Japan: (67.9%)
Nikkei Index: (1.9%)
S&P 500: 41.6%
Comparable Companies: 80.0%
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Section III
PROJECTIONS AND DISCOUNTED CASH FLOW ANALYSIS
- - Our discounted cash flow analysis is based on the projections provided by
management
- - For the Apple DCF, we used a weighted average cost of capital range of
10-12%
- - For the Juniper DCF, we used a weighted average cost of capital range of
9-11%
- - Using these projections and discount rates produces values for Apple and
Juniper in line with current prices
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Overview of Apple Historical and Projected Financials
OVERVIEW OF APPLE HISTORICAL AND PROJECTED FINANCIALS
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ACTUAL PROJECTED
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1995 1996 1997 1998 1999 2000
-------------- -------------- -------------- -------------- -------------- --------------
Sales ($MM) 718.3 716.8 845.2 587.6 497.6 582.9
% Growth (0.2%) 17.9% (30.5%) (15.3%) 17.2%
EBITDA ($MM) 138.0 137.3 161.6 38.8 33.4 53.3
% Margin 19.2% 19.2% 19.1% 6.6% 6.7% 9.1%
OVERVIEW OF APPLE HISTORICAL AND PROJECTED FINANCIALS
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PROJECTED
-----------------------------------------------
2001 2002 2003
-------------- -------------- ---------------
Sales ($MM) 626.6 661.6 700.7
% Growth 7.5% 5.6% 5.9%
EBITDA ($MM) 63.9 65.3 68.6
% Margin 10.2% 9.9% 9.8%
Note: (1) Based on management projections.
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Overview of Juniper Historical and Projected Financials
OVERVIEW OF JUNIPER HISTORICAL AND PROJECTED FINANCIALS
ACTUAL PROJECTED
---------------------------------------------------------------- -------------------------------
1995 1996 1997 1998 1999 2000
-------------- -------------- -------------- -------------- -------------- --------------
Sales ((Y)Bn) 178.0 212.2 203.4 184.5 153.5 150.0
% Growth 19.2% (4.2%) (5.4%) (16.8%) (2.3%)
EBITDA ((Y)Bn) 51.2 62.5 49.5 32.9 20.9 18.3
% Margin 28.7% 29.5% 24.3% 6.6% 13.6% 12.2%
OVERVIEW OF JUNIPER HISTORICAL AND PROJECTED FINANCIALS
PROJECTED
-------------------------------------------------
2001 2002 2003
--------------- -------------- ---------------
Sales ((Y)Bn) 155.3 160.7 166.3
% Growth 3.5% 3.5% 3.5%
EBITDA ((Y)Bn) 21.4 23.2 25.1
% Margin 13.8% 14.5% 15.1%
Note: (1) Based on management projections that assume an exchange rate of 120
YEN/ $.
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10-Year DCF
($MM, except per share amounts)
APPLE TOTAL COMPANY
- -------------------
Valuation Matrix as of October 1, 1999
- -------------------- -------------------------------- -------------------------------- --------------------------------
EXIT EBITDA MULTIPLE 7.5 8.5 9.5
-------------------------------- -------------------------------- --------------------------------
DISCOUNT RATE 10.0% 11.0% 12.0% 10.0% 11.0% 12.0% 10.0% 11.0% 12.0%
PV of 1st Year Cash Flow $ 21.9 $ 21.8 $ 21.7 $ 21.9 $ 21.8 $ 21.7 $ 21.9 $ 21.8 $ 21.7
PV of Cash Flows 2 Through 10 270.2 257.7 246.0 270.2 257.7 246.0 270.2 257.7 246.0
Terminal Value 805.3 805.3 805.3 912.7 912.7 912.7 1,020.1 1,020.1 1,020.1
Implied EBIT Multiple 10.4 10.4 10.4 11.8 11.8 11.8 13.2 13.2 13.2
Implied Perpetual Growth Rate 1.3% 2.2% 3.1% 2.3% 3.2% 4.1% 3.1% 4.0% 4.9%
PV of Terminal Value 313.0 286.1 261.7 354.7 324.2 296.6 396.4 362.4 331.5
AGGREGATE VALUE 605.0 565.6 529.4 646.7 603.7 564.3 688.5 641.8 599.2
Less Total Debt & Preferred Stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Less Minority Interest 114.5 114.5 114.5 114.5 114.5 114.5 114.5 114.5 114.5
Plus Cash 137.3 137.3 137.3 137.3 137.3 137.3 137.3 137.3 137.3
Plus Option Proceeds 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
EQUITY VALUE $ 627.8 $ 588.4 $ 552.3 $ 669.6 $ 626.5 $ 587.2 $ 711.3 $ 664.7 $ 622.1
EQUITY VALUE PER SHARE $ 11.12 $ 10.42 $ 9.78 $ 11.86 $ 11.10 $ 10.40 $ 12.60 $ 11.78 $ 11.02
% Value in Terminus 51.7% 50.6% 49.4% 54.8% 53.7% 52.6% 57.6% 56.5% 55.3%
% Value in Cash Flows 48.3% 49.4% 50.6% 45.2% 46.3% 47.4% 42.4% 43.5% 44.7%
-------------------------------------------
Equity Value $588.4 -- $664.7
Equity Value Per Share $10.42 -- $11.78
-------------------------------------------
---------
Current Price $11.75
---------
<FN>
(1) Minority interest calculated as 49% of Malaysian current market
capitalization of $234MM.
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10-Year DCF
($MM, except per share amounts)
JUNIPER TOTAL COMPANY
- ---------------------
VALUATION MATRIX AS OF OCTOBER 1, 1999
- --------------------- -------------------------------- --------------------------------- --------------------------------
PERPETUAL GROWTH RATE 1.0% 2.0% 3.0%
-------------------------------- --------------------------------- --------------------------------
DISCOUNT RATE 9.0% 10.0% 11.0% 9.0% 10.0% 11.0% 9.0% 10.0% 11.0%
PV of 1st Year Cash Flow $ 44.7 $ 44.6 $ 44.4 $ 44.7 $ 44.6 $ 44.4 $ 44.7 $ 44.6 $ 44.4
PV of Cash Flows 2 Through 10 644.4 615.4 588.3 644.4 615.4 588.3 644.4 615.4 588.3
Terminal Value 1,673.3 1,494.2 1,350.8 1,931.3 1,697.6 1,515.8 2,275.2 1,959.1 1,722.0
Implied EBITDA Multiple 6.4 5.8 5.2 7.4 6.5 5.8 8.8 7.5 6.6
Implied EBIT Multiple 7.1 6.3 5.7 8.2 7.2 6.4 9.6 8.3 7.3
PV of Terminal Value 711.9 580.7 479.9 821.7 659.7 538.5 968.0 761.3 611.8
AGGREGATE VALUE 1,401.0 1,240.6 1,112.6 1,510.8 1,319.7 1,171.2 1,657.1 1,421.3 1,244.5
Less Total Debt & Preferred Stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Plus Cash 169.7 169.7 169.7 169.7 169.7 169.7 169.7 169.7 169.7
Plus Option Proceeds 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
EQUITY VALUE $ 1,570.7 $ 1,410.4 $ 1,282.3 $ 1,680.5 $ 1,489.4 $ 1,340.9 $ 1,826.8 $ 1,591.0 $ 1,414.2
EQUITY VALUE PER SHARE $ 10.89 $ 9.78 $ 8.89 $ 11.65 $ 10.32 $ 9.29 $ 12.66 $ 11.03 $ 9.80
% Value in Terminus 50.8% 46.8% 43.1% 54.4% 50.0% 46.0% 58.4% 53.6% 49.2%
% Value in Cash Flows 49.2% 53.2% 56.9% 45.6% 50.0% 54.0% 41.6% 46.4% 50.8%
--------------------------------------
Equity Value $1,410.4 -- $1,591.0
$ Per Share $9.78 -- $11.03
Yen Per Share (1) 1,045 -- 1,179
--------------------------------------
------
Current Price (Yen Per Share) (1) 1,090
------
<FN>
(1) Based on an exchange rate of 107 Yen per USD.
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Section IV
PRECEDENT TRANSACTIONS
- - Precedent transactions, where a principal shareholder acquires all of the
outstanding minority shares, consist primarily of U.S. based transactions
and have been done at an average 28% premium to the unaffected stock
price
- - Only a few public precedent transactions have occurred in Japan
- - In a recent and relevant transaction, the founder of Herbalife has
offered to repurchase the outstanding minority interest private at a 42%
premium to the Class A (voting) share price
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Summary of Precedent Transactions
Premium to Unaffected Price (1)
[GRAPH]
[Median
1987 to Date
28%]
1987-1990 1991-1993 1994-1996 1997-1999 YTD
- --------- --------- --------- -------------
33% 20% 26% 28%
Note: (1) Represents median tender offer price for transactions during the
specified period as a premium to the market price one month prior to
announcement.
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Section IV (continued)
JAPANESE CASE STUDIES
- - There are a limited number of precedent transactions in Japan
- - The sample size makes it difficult to draw any meaningful conclusions
- - Three deals (NCR Japan, Japan Marine Technologies and SDS Biotech) were
all cash tender offers
- - The most recent transactions, involving three Sony subsidiaries, involved
a stock for stock offer
- - The premiums paid over unaffected market prices have ranged from 12% to
62%
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Herbalife International Case Study
TRANSACTION BACKGROUND
- - On September 14, 1999, CEO Mark Hughes announced the intention to repurchase
the remaining 46% of Class A shares and 42% of Class B shares which he did
not already own.
- - Herbalife stock had been under significant pressure due to Russian exposure,
Asian uncertainty, currency risks and negative publicity associated with
specific herbal products. Hughes was disappointed in the stock's performance
and taking the company private seemed like a logical next step.
- - In February of 1997, the stock had foundered after Hughes had indicated the
desire to sell 1/4 of his shareholdings in a DECS security. This sale of the
stock was not completed and the stock rebounded soon thereafter.
- - The Company recapitalized with a new Class B non-voting stock in December of
1997, the same year the stock reached its all-time high at $37 3/8, a 120%
premium to the $17 repurchase price.
PRICE VOLUME GRAPHS
Graphs depicting daily share prices and trading volumes for Herbalife
Class A and Class B stock.
KEY VALUATION STATISTICS
Equity Value (MM) (1): $561.0
Aggregate Value(2): $428.3
LTM 1999E
--- -----
Agg. Val/Sales 0.52 0.51x
Agg. Val/EBITDA 5.2x 4.2x
Agg. Val/EBIT 6.4x 4.9x
P/E NR 9.2x
<FN>
(1) Includes options (net of exercise proceeds).
(2) Aggregate value defined as equity market value plus debt and minority
interest less cash.
KEY TRADING STATISTICS
Class A Class B
------- -------
Total Shares Outstanding (MM) 9.982 18.605
Average Daily Trading Volume (1) 47,152 91,419
Unaffected Premium (2) 38.1% 76.6%
Premium to Prior Day 41.7% 85.7%
Discount to All Time High (54.5%) (36.4%)
<FN>
(1) Average over last 4 weeks.
(2) Unaffected premium defined as stock price
one month prior.
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Section V
Shareholding and Trading Analysis
- - Institutional shareholders comprise approximately 18% of the Apple public
float and 19% of the Juniper public float
- - Institutional investors appear to be largely value investors
- - The balance of shares are held by retail investors
- - Historical price/volume analysis is often used to try to assess the
shareholders' basis in the stock
- - Since July 1, 1998, shares representing greater than 100% of the
outstanding float have traded in both Apple and Juniper shares
- - Since July 1, 1998, 100% of the trading in Apple shares occurred below
$16 and 100% of the trading in Juniper shares occurred below the 1650 YEN
level
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Apple Analysis of Institutional Shareholdings
TOTAL ASSETS UNDER CURRENT CUMULATIVE % REPORT
INSTITUTION EQUITY ORIENTATION MANAGEMENT CHANGE HOLDINGS % FLOAT OF FLOAT DATE
- ---------------------------------- -------------------- ----------- --------- ----------- ------- ------------ -------
PPM America Inc. Value 29.8 1,117,000 1,117,000 13.2% 13.2% 6/30/99
Cazenove Unit Trust Management Ltd. n/a n/a (30,000) 81,100 1.0% 14.2% 11/30/98
Fidelity Management & Research Co. Growth, Value, Income 433.8 52,000 52,000 0.6% 14.8% 6/30/99
World Asset Management Index 9.9 0 42,400 0.5% 15.3% 6/30/99
Comerica Bank - Detroit Growth n/a (400) 41,800 0.5% 15.8% 6/30/99
Prudential Securities Inc. n/a n/a (26,000) 26,600 0.3% 16.1% 6/30/99
Smith Barney Asset Management Growth, Value 13.0 (2,632) 26,567 0.3% 16.4% 6/30/99
GAMCO Investors, Inc. Value 5.4 24,000 24,000 0.3% 16.7% 6/30/99
Van Kampen n/a n/a 0 22,742 0.3% 16.9% 6/30/99
C. Blair Asset Management, L.P. n/a n/a 20,500 20,500 0.2% 17.2% 6/30/99
Caxton Associates, L.L.C n/a n/a (11,300) 14,800 0.2% 17.4% 6/30/99
Old Kent Bank (MI) Value, Growth 10.4 12,020 12,020 0.1% 17.5% 6/30/99
Banco Fonder n/a n/a 0 12,000 0.1% 17.6% 3/31/99
Global Assets Advisors, Inc. n/a 0.0 10,000 10,000 0.1% 17.8% 6/30/98
Morgan Stanley Dean Witter Growth, Value n/a (7,100) 8,200 0.1% 17.9% 6/30/99
INVESCO Capital Management Inc. Value, Income 43.8 (12,000) 3,000 0.0% 17.9% 6/30/99
Westport Resources Management, Inc. Growth,Value 0.1 (500) 2,600 0.0% 17.9% 12/31/98
Mercantile Bank, N.A Value 0.3 0 2,000 0.0% 17.9% 6/30/99
Legg Mason Wood Walker, Inc. Value n/a 600 1,000 0.0% 18.0% 6/30/99
Fleet Investment Advisors (Mass) Growth, Income, Index 42.2 0 570 0.0% 18.0% 6/30/99
Bear, Stearns Asset Management Inc. Value n/a 0 300 0.0% 18.0% 6/30/99
Total Institutional Holdings 1,032,760 1,521,199 18.0%
========= ---------
Other Holdings 6,944,801 82.0%
--------- ----
Total Public Float 8,466,000 100.0%
========= =====
<FN>
Summary of Latest 13F Reports
7 Institutions increased holdings, of which 6 were new investors or first time
filers
17 Institutions decreased holdings, of which 8 eliminated their positions
6 Institutions held their positions.
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Juniper (OTC) Analysis of Institutional Shareholdings
Total Assets
Under Current Cumulative % Report
Institution Equity Orientation Management Change Holdings % Float of Float Date
- ---------------------------------- -------------------- ---------- ------ --------- ------- ----------- -------
Harris Associates L.P. Value 9.6 (236,400) 1,630,300 4.8% 4.8% 9/30/98
INVESCO Asset Management (Japan) Growth n/a (201,060) 755,810 2.2% 7.0% 2/28/99
New Jersey Division of Investment n/a n/a 0 683,300 2.0% 9.0% 9/30/98
Foreign & Colonial Management Ltd. Growth 34.0 250,000 350,000 1.0% 10.0% 12/31/98
INVESCO Asset Management Ltd. Growth n/a 26,400 323,900 0.9% 11.0% 9/30/98
Schroder Investment Mgmt. (Jpn) Ltd. n/a n/a (86,000) 251,000 0.7% 11.7% 2/28/99
ING Investment Management (Neth.) n/a n/a 56,000 192,500 0.6% 12.3% 12/31/98
Global Asset Management (UK) Ltd. n/a n/a (266,000) 171,700 0.5% 12.8% 6/30/99
Merrill Lynch Asset Management (US) Value 212.9 (155,700) 89,600 0.3% 13.0% 1/31/99
Kokusai Asset Management Co., Ltd. n/a n/a (1,000) 54,000 0.2% 13.2% 3/31/99
Nikko Asset Management Co., Ltd. n/a n/a (15,000) 51,000 0.1% 13.3% 2/28/99
Fidelity Management & Research Co. Growth, Value, Income 433.8 (193,300) 36,600 0.1% 13.4% 4/30/99
Nomura Asset Management Co., Ltd. n/a n/a (20,000) 33,000 0.1% 13.5% 7/31/98
Templeton Investment Mgmt. Co. (HK) n/a n/a 26,400 33,000 0.1% 13.6% 12/31/98
Fidelity Investments Japan Ltd. Growth n/a (197,400) 31,700 0.1% 13.7% 10/31/98
Dresdner RCM Global Asia Ltd. n/a n/a 22,000 29,000 0.1% 13.8% 9/15/98
Clay Finlay Inc. Growth n/a (26,700) 23,000 0.1% 13.9% 6/30/98
Victoire Asset Management n/a n/a (20,000) 22,000 0.1% 14.0% 6/30/99
Lazard Asset Management (US) Value 35.4 12,000 21,000 0.1% 14.0% 3/31/98
Aberdeen Asset Management (Asia) Ltd n/a n/a (26,700) 9,300 0.0% 14.0% 6/19/98
SPARX Asset Management Co., Ltd. n/a n/a (30,700) 6,500 0.0% 14.1% 12/31/98
Schroder Investment Management (UK) n/a n/a (74,300) 6,000 0.0% 14.1% 2/15/99
Citibank Global Asset Management Growth 71.0 (17,829) 2,968 0.0% 14.1% 12/31/98
Rothschild Asset Management (UK) Value 4.1 0 2,000 0.0% 14.1% 3/31/99
NPI n/a n/a (4,600) 2,000 0.0% 14.1% 1/21/99
Universal Investment Trust Mgmt. Co. n/a n/a (8,000) 2,000 0.0% 14.1% 3/15/98
Fidelity Investment Services Ltd. Growth n/a (500) 1,600 0.0% 14.1% 10/31/97
Donaldson Lufkin & Jenrette, Inc. n/a n/a 200 200 0.0% 14.1% 6/30/99
Top Institutions (1,188,189) 4,814,978 14.1%
Remaining Institutions (621,460) 0 0.0%
---------- ---------- ------
Total Institutional Holdings (1,809,649) 4,814,978 14.1%
==========
Other Holdings 29,315,022 85.9%
---------- ------
Total Public Float 34,130,000 100.0%
========== ======
<FN>
Summary of Latest 13F Reports
7 Institutions increased holdings, of which 1 were new investors or first time
filers
31 Institutions decreased holdings, of which 12 eliminated their
positions
2 Institutions held their positions.
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Juniper (ADS) Analysis of Institutional Shareholdings
Total Assets
Under Current Cumulative % Report
Institution Equity Orientation Management Change Holdings % Float of Float Date
- ------------------------------------ ---------------------- ---------- ------ -------- ------- ----------- ------
Orbis Investment Management Ltd. Value 0.6 46,300 1,479,100 2.2%
Capital Research & Management Co. Growth, Value 177.5 (50) 581,250 0.9% 2.2% 6/30/99
Fidelity Management & Research Co. Growth, Value, Income 433.8 105,000 355,000 0.5% 3.0% 6/30/99
Royce & Associates, Inc. Value 2.0 0 234,500 0.3% 3.5% 6/30/99
MacKay-Shields Financial Corporation Growth, Value 22.2 0 227,148 0.3% 3.9% 6/30/99
World Asset Management Index 9.9 0 212,104 0.3% 4.2% 6/30/99
JMG Capital Partners, L.P. n/a n/a 108,749 108,749 0.2% 4.5% 6/30/99
Financial & Investment Management n/a n/a (3,855) 78,245 0.1% 4.7% 3/31/99
Merrill Lynch Capital Markets Growth n/a 603 73,787 0.1% 4.8% 6/30/99
Global Assets Advisors, Inc. n/a 0.0 64,300 64,300 0.1% 4.9% 6/30/99
Boston Partners Asset Management Value 6.3 18,400 46,100 0.1% 5.0% 6/30/98
GAMCO Investors, Inc. Value 5.4 5,000 35,641 0.1% 5.1% 6/30/99
Shufro, Rose & Co., LLC Income n/a (900) 26,574 0.0% 5.1% 6/30/99
Goldman Sachs Asset Management (US) Growth, Value 77.8 0 12,500 0.0% 5.2% 6/30/99
Connor Clark & Company Ltd. n/a n/a 12,000 12,000 0.0% 5.2% 6/30/99
Old Kent Bank (MI) Value, Growth 10.4 11,250 11,250 0.0% 5.2% 6/30/99
The Northern Trust Company Value, Growth 124.3 10,000 10,000 0.0% 5.2% 6/30/99
5.2% 6/30/99
Top Institutions 376,797 3,568,248 5.2%
Remaining Institutions (878,945) 0 0.0%
-------- ---------- ------
Total Institutional Holdings (502,148) 3,568,248 5.2%
========
Other Holdings 64,691,752 94.8%
---------- ------
Public Float 68,260,000 100.0%
========== ======
<FN>
Summary of Latest 13F Reports
10 Institutions increased holdings, of which 5 were new investors or first time
filers
12 Institutions decreased holdings, of which 9 eliminated their positions
4 Institutions held their positions.
Index funds representing 5.9% of Total Institutional Shares Outstanding.
24
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Historical Price / Volume Analysis - Apple (1)
Percentage of Share Traded Below a Specified Price
Price 1994 1995 1996 1997-1H 1997-2H 1998-1H 1998-2H 1999YTD 1994 to Date
----- ---- ---- ---- ------- ------- ------- ------- ------- ------------
($)
50 100.0% -- -- 100.0% 100.0% -- -- -- 100.0%
45 98.2% 100.0% 100.0% 72.1% 97.0% -- -- -- 96.5%
40 83.3% 87.7% 85.2% 17.9% 82.8% -- -- -- 82.0%
35 44.3% 44.8% 70.9% 0.0% 68.5% -- -- -- 56.8%
30 18.9% 1.6% 27.1% -- 52.5% -- -- -- 33.5%
25 0.0% 0.0% 0.0% -- 28.1% 100.0% -- -- 14.7%
20 -- -- -- -- 12.3% 80.6% -- -- 11.8%
19 -- -- -- -- 9.1% 71.5% -- -- 11.0%
18 -- -- -- -- 3.6% 67.1% -- -- 9.8%
17 -- -- -- -- 0.0% 57.2% -- -- 9.1%
16 -- -- -- -- -- 44.9% 100.0% -- 8.1%
15 -- -- -- -- -- 39.0% 85.6% 100.0% 7.4%
14 -- -- -- -- -- 17.2% 57.3% 90.2% 5.5%
13 -- -- -- -- -- 6.0% 55.2% 66.5% 4.2%
12 -- -- -- -- -- 2.5% 42.9% 43.3% 3.1%
11 -- -- -- -- -- 0.0% 39.1% 39.9% 2.5%
10 -- -- -- -- -- -- 24.2% 28.2% 1.6%
9 -- -- -- -- -- -- 6.7% 24.7% 1.1%
8 -- -- -- -- -- -- 0.0% 3.0% 0.6%
7 -- -- -- -- -- -- -- 0.0% 0.0%
- --------------------------------------------------------------------------------------------------------------------------------
% of Total Shares
Publicly Traded (2) 216.4% 107.5% 83.7% 56.5% 114.4% 80.5% 86.2% 65.1% 810.4%
- --------------------------------------------------------------------------------------------------------------------------------
Last Date Traded
Price at or Above Price
----- -----------------
($)
50 1/21/1997
45 7/11/1997
40 7/24/1997
35 8/27/1997
30 10/14/1997
25 10/24/1997
20 3/11/1998
19 3/20/1998
18 3/25/1998
17 4/21/1998
16 7/23/1998
15 7/31/1998
14 7/29/1999
13 9/7/1999
12 9/13/1999
11 9/17/1999
10 9/17/1999
9 9/17/1999
8 9/17/1999
7 9/17/1999
Note : (1) Using volume weighted closing prices as of 9/17/99.
(2) Based on public float of 8.5MM shares outstanding.
25
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Historical Price / Volume Analysis - Juniper (OTC)(1)
Percentage of Share Traded Below a Specified Price
Price 1994 1995 1996 1997-1H 1997-2H 1998-1H 1998-2H 1999YTD
----- ---- ---- ---- ------- ------- ------- ------- -------
(YEN)
5500 -- -- 100.0% -- -- -- -- --
5000 100.0% 100.0% 62.2% 100.0% -- -- -- --
4500 83.0% 93.9% 14.1% 94.1% -- -- -- --
4000 67.9% 58.4% 4.6% 74.4% 100.0% -- -- --
3500 36.6% 31.9% 0.0% 31.4% 65.8% -- -- --
3000 4.0% 8.2% -- 0.0% 26.9% 100.0% -- --
2500 0.0% 0.0% -- -- 17.7% 88.3% -- --
2400 -- -- -- -- 10.8% 76.6% -- --
2300 -- -- -- -- 5.6% 65.9% -- --
2200 -- -- -- -- 0.0% 64.5% -- --
2100 -- -- -- -- -- 59.1% -- --
2000 -- -- -- -- -- 46.9% -- --
1900 -- -- -- -- -- 32.4% -- --
1800 -- -- -- -- -- 25.1% -- --
1700 -- -- -- -- -- 17.4% 100.0% --
1600 -- -- -- -- -- 9.0% 91.5% --
1500 -- -- -- -- -- 4.0% 69.1% --
1400 -- -- -- -- -- 0.0% 49.3% 100.0%
1300 -- -- -- -- -- -- 40.6% 95.2%
1200 -- -- -- -- -- -- 22.1% 52.4%
1100 -- -- -- -- -- -- 11.9% 28.3%
1000 -- -- -- -- -- -- 5.6% 0.0%
900 -- -- -- -- -- -- 0.0% --
- ------------------------------------------------------------------------------------------------------------------------------------
% of Total Shares
Publicly Traded (2) 36.6% 108.5% 72.7% 37.5% 18.8% 22.0% 29.7% 63.0%
- ------------------------------------------------------------------------------------------------------------------------------------
Last Date Trade
Price 1994 to Date at or Above Price
----- ------------ -----------------
(YEN)
5500 100.0% 7/31/1996
5000 90.1% 8/21/1996
4500 74.3% 6/13/1997
4000 56.4% 6/20/1997
3500 35.9% 10/27/1997
3000 20.8% 11/16/1997
2500 15.7% 3/5/1998
2400 14.3% 3/9/1998
2300 13.8% 3/16/1998
2200 13.4% 3/17/1998
2100 13.0% 3/23/1998
2000 12.3% 4/9/1998
1900 11.7% 4/22/1998
1800 11.4% 5/20/1998
1700 11.0% 6/5/1998
1600 10.5% 8/12/1998
1500 9.5% 8/25/1998
1400 9.0% 11/5/1998
1300 8.2% 8/24/1999
1200 4.2% 9/3/1999
1100 2.4% 9/16/1999
1000 0.1% 9/17/1999
900 0.0% 9/17/1999
- ------------------------------------
% of Total Shares
Publicly Traded (2) 299.1%
- ------------------------------------
<FN>
Note : (1) Using volume weighted closing prices as of 9/17/99.
(2) 1999YTD based on public float of 34.1MM shares outstanding. Prior
years based on 24.7MM shares outstanding.
26
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Historical Price / Volume Analysis -- Juniper (ADS) (1)
Percentage of Share Traded Below a Specified Price
Price 1994 1995 1996 1997-1H 1997-2H 1998-1H 1998-2H 1999YTD 1994 to Date
----- ---- ---- ---- ------- ------- ------- ------- ------- ------------
($)
26 -- -- 100.0% -- -- -- -- -- 100.0%
25 -- -- 96.9% 100.0% -- -- -- -- 98.4%
24 -- -- 74.4% 94.1% -- -- -- -- 94.7%
23 -- 100.0% 63.9% 74.4% -- -- -- -- 93.0%
22 -- 95.1% 44.5% 31.4% -- -- -- -- 88.3%
21 -- 89.8% 27.6% 0.0% 100.0% -- -- -- 84.4%
20 -- 75.1% 15.5% -- 96.9% -- -- -- 78.9%
19 100.0% 57.8% 9.6% -- 93.8% -- -- -- 72.3%
18 75.4% 35.1% 6.8% -- 73.4% -- -- -- 54.2%
17 56.8% 27.0% 3.0% -- 56.9% -- -- -- 48.8%
16 16.6% 16.9% 0.0% -- 50.4% -- -- -- 37.0%
15 2.9% 6.2% -- -- 48.7% -- -- -- 30.1%
14 0.0% 0.0% -- -- 43.8% -- -- -- 26.4%
13 -- -- -- -- 31.7% -- -- -- 25.0%
12 -- -- -- -- 3.6% 100.0% -- -- 24.9%
11 -- -- -- -- 0.0% 96.8% -- -- 24.4%
10 -- -- -- -- -- 88.1% -- -- 22.7%
9 -- -- -- -- -- 73.8% -- -- 19.8%
8 -- -- -- -- -- 61.9% -- -- 18.7%
7 -- -- -- -- -- 37.5% 100.0% -- 16.8%
6 -- -- -- -- -- 14.5% 82.6% 100.0% 14.4%
5 -- -- -- -- -- 0.0% 27.9% 26.9% 4.6%
4 -- -- -- -- 1.9% 0.0% 4.0%
3 -- -- -- -- -- -- 0.0% -- 0.0%
- ------------------------------------------------------------------------------------------------------------------------------------
% of Total Shares
Publicly Traded (2) 16.8% 11.2% 11.3% 10.2% 7.9% 11.4% 16.8% 14.9% 77.0%
- ------------------------------------------------------------------------------------------------------------------------------------
Last Date Trade
Price at or Above Price
----- -----------------
($)
26 5/1/1996
25 7/2/1996
24 8/1/1996
23 8/26/1996
22 9/19/1996
21 11/12/1996
20 6/13/1997
19 6/16/1997
18 6/16/1997
17 7/3/1997
16 7/31/1997
15 10/20/1997
14 10/27/1997
13 11/5/1997
12 11/7/1997
11 2/12/1998
10 3/3/1998
9 3/16/1998
8 4/13/1998
7 5/12/1998
6 1/15/1999
5 9/17/1999
4 9/17/1999
3 9/17/1999
Note : (1) Using volume weighted closing prices as of 9/17/99.
(2) 1999YTD based on public float of 68.2MM ADS equivalents. Prior
years based on 24.7MM shares outstanding.
27
PROJECT POWERHOUSE
- --------------------------------------------------------------------------------
Section VI
PRICING CONSIDERATIONS
- - Determining the appropriate value to pay to Apple and Juniper
shareholders will be a function of the intrinsic value of the entities
and the value of expected synergies that may be realized
28
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Relative Premium Analysis
Juniper
- ------------------------------------------------------------------------------------------------------------------------------------
Last Date Total Volume % of
Purchase 1 Month 2 Month 3 Month 6 Month 1 Year 2 Year Stock Closed Public Float Since
Price Current Price Average Average Average Average Average Average At or Above Last Day Traded
----- ------------- ------- ------- ------- ------- ------- ------- ----------- ------------------
(Yen) 1090 1197 1209 1213 1183 1191 1700
----- ----- ----- ----- ----- ----- ----- ------
1400 28.4% 16.9% 15.8% 15.4% 18.3% 17.5% (17.6%) 11/25/98 87.2%
1450 33.0% 21.1% 19.9% 19.5% 22.6% 21.7% (14.7%) 8/26/98 102.0%
1500 37.6% 25.3% 24.1% 23.7% 26.8% 25.9% (11.8%) 8/25/98 102.1%
1600 46.8% 33.6% 32.3% 31.9% 35.3% 34.3% (5.9%) 8/12/98 104.9%
1700 56.0% 42.0% 40.6% 40.1% 43.7% 42.7% 0.0% 6/5/98 119.1%
1800 65.1% 50.3% 48.9% 48.4% 52.2% 51.1% 5.9% 5/20/98 121.2%
1900 74.3% 58.7% 57.1% 56.6% 60.6% 59.5% 11.8% 4/22/98 124.5%
2000 83.5% 67.0% 65.4% 64.9% 69.1% 67.9% 17.7% 4/9/98 126.2%
Apple
- ------------------------------------------------------------------------------------------------------------------------------------
Last Date Total Volume % of
Purchase 1 Month 2 Month 3 Month 6 Month 1 Year 2 Year Stock Closed Public Float Since
Price Current Price Average Average Average Average Average Average At or Above Last Day Traded
----- ------------- ------- ------- ------- ------- ------- ------- ----------- ------------------
($) $11.75 $12.58 $13.03 $12.83 $11.17 $10.45 $14.18
----- ------ ------ ------ ------ ------ ------ ------
$15.00 27.7% 19.2% 15.1% 16.9% 34.3% 43.6% 5.8% 7/31/98 117.2%
16.00 36.2% 27.2% 22.7% 24.7% 43.3% 53.1% 12.9% 7/23/98 123.9%
17.00 44.7% 35.1% 30.4% 32.5% 52.2% 62.7% 19.9% 4/21/98 192.6%
18.00 53.2% 43.1% 38.1% 40.3% 61.2% 72.3% 27.0% 3/25/98 201.9%
19.00 61.7% 51.0% 45.8% 48.1% 70.2% 81.8% 34.0% 3/20/98 202.6%
20.00 70.2% 59.0% 53.4% 55.9% 79.1% 91.4% 41.1% 3/11/98 205.4%
29
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Cost to Effect Powerhouse (1)
09/17 Closing Price Public Float (Thousands)
------------------- ------------------------
Apple $11.75 8,466
Juniper 1090 YEN 34,130
APPLE
TENDER PRICE JUNIPER TENDER PRICE
- --------------------------------------------------------------------------------------------------------------
1400 YEN 1500 YEN 1600 YEN 1700 YEN 1800 YEN 1900 YEN 2000 YEN
-------- -------- -------- -------- -------- -------- --------
$14.00 $565.6 $597.5 $629.4 $661.4 $693.3 $725.2 $757.2
15.00 574.0 606.0 637.9 669.8 701.8 733.7 765.6
16.00 582.5 614.4 646.4 678.3 710.2 742.2 774.1
17.00 591.0 622.9 654.8 686.8 718.7 750.6 782.6
18.00 599.4 631.4 663.3 695.2 727.2 759.1 791.0
19.00 607.9 639.8 671.8 703.7 735.6 767.6 799.5
20.00 616.4 648.3 680.2 712.2 744.1 776.0 808.0
<FN>
(1) Based on an exchange rate of 106.9 Yen per USD.
30
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Apple Valuation Matrix
($MM)
VALUATION
-------------------------------------------------------------------------------------------------------------------------
Eq. Val. / Agg. Val./
Price Premium Equity Aggregate ---------------------- -----------------
Per Share to Current Value Value 99E NI 00E NI '99E Sales
--------- ---------- ----- ----- ------ ------- ----------
Statistics: $11.3 $27.9 $497.6
====================================================================================================================================
$11.75 0.00% $663 $608 58.6 x 23.8 x 1.22 x
$12.00 2.13% $677 $508 59.8 24.3 1.02
$12.50 6.38% $706 $536 62.3 25.3 1.08
$13.00 10.64% $734 $564 64.8 26.3 1.13
$13.50 14.89% $762 $592 67.3 27.3 1.19
$14.00 19.15% $790 $620 69.8 28.3 1.25
$14.50 23.40% $818 $649 72.3 29.3 1.30
$15.00 27.66% $847 $677 74.8 30.4 1.36
$15.50 31.91% $875 $705 77.3 31.4 1.42
$16.00 36.17% $903 $733 79.8 32.4 1.47
$16.50 40.43% $931 $762 82.3 33.4 1.53
$17.00 44.68% $960 $790 84.7 34.4 1.59
$17.50 48.94% $988 $818 87.2 35.4 1.64
$18.00 53.19% $1,016 $846 89.7 36.4 1.70
$18.50 57.45% $1,044 $874 92.2 37.4 1.76
$19.00 61.70% $1,072 $903 94.7 38.4 1.81
$19.50 65.96% $1,101 $931 97.2 39.5 1.87
$20.00 70.21% $1,129 $959 99.7 40.5 1.93
VALUATION
-------------------------------------------------------------------------------------------------------------------------
Agg. Val. /
--------------------------------------------------------------------------------------------------
'00E Sales '99E EBITDA '00E EBITDA '99E EBIT '00E EBIT
---------- ----------- ----------- --------- ---------
Statistics: $582.9 $33.4 $53.3 $21.3 $40.0
===================================================================================================================================
1.04 x 18.2 x 11.4 x 28.5x 15.2x
0.87 15.2 9.5 23.8 12.7
0.92 16.0 10.1 25.1 13.4
0.97 16.9 10.6 26.5 14.1
1.02 17.7 11.1 27.8 14.8
1.06 18.6 11.6 29.1 15.5
1.11 19.4 12.2 30.4 16.2
1.16 20.2 12.7 31.8 16.9
1.21 21.1 13.2 33.1 17.6
1.26 21.9 13.8 34.4 18.3
1.31 22.8 14.3 35.7 19.1
1.35 23.6 14.8 37.1 19.8
1.40 24.5 15.4 38.4 20.5
1.45 25.3 15.9 39.7 21.2
1.50 26.2 16.4 41.0 21.9
1.55 27.0 16.9 42.4 22.6
1.60 27.8 17.5 43.7 23.3
1.65 28.7 18.0 45.0 24.0
31
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Juniper Valuation Matrix
(Bn YEN)
VALUATION
----------------------------------------------------------------------------------------------
Eq. Val. /
-------------------------
Price Premium Equity Aggregate
Per Share to Current Value Value 99E NI 00E NI
--------- ---------- ----- ----- ------ ------
- ------------------------------------------------------------------------------------------------------------------------------------
Statistics: 9,596 8,531
====================================================================================================================================
1,090 0.00% 157,250 136,883 16.4 x 18.4 x
1,150 5.50% 165,906 145,539 17.3 19.4
1,200 10.09% 173,119 152,752 18.0 20.3
1,250 14.68% 180,333 159,966 18.8 21.1
1,300 19.27% 187,546 167,179 19.5 22.0
1,350 23.85% 194,759 174,392 20.3 22.8
1,400 28.44% 201,972 181,606 21.0 23.7
1,450 33.03% 209,186 188,819 21.8 24.5
1,500 37.61% 216,399 196,032 22.6 25.4
1,550 42.20% 223,612 203,245 23.3 26.2
1,600 46.79% 230,826 210,459 24.1 27.1
1,650 51.38% 238,039 217,672 24.8 27.9
1,700 55.96% 245,252 224,885 25.6 28.8
1,750 60.55% 252,466 232,099 26.3 29.6
1,800 65.14% 259,679 239,312 27.1 30.4
1,850 69.72% 266,892 246,525 27.8 31.3
1,900 74.31% 274,105 253,739 28.6 32.1
1,950 78.90% 281,319 260,952 29.3 33.0
VALUATION
------------------------------------------------------------------------------------------------------------------
Agg. Val. /
---------------------------------------------------------------------------------------------
'99E Sales '00E Sales '99E EBITDA '00E EBITDA '99E EBIT '00E EBIT
---------- ---------- ----------- ----------- --------- ---------
- -----------------------------------------------------------------------------------------------------------------------------------
Statistics: 153,500 150,000 20,890 18,260 18,790 15,410
===================================================================================================================================
0.89 x 0.91 x 6.6 x 7.5 x 7.3 x 8.9 x
0.95 0.97 7.0 8.0 7.7 9.4
1.00 1.02 7.3 8.4 8.1 9.9
1.04 1.07 7.7 8.8 8.5 10.4
1.09 1.11 8.0 9.2 8.9 10.8
1.14 1.16 8.3 9.6 9.3 11.3
1.18 1.21 8.7 9.9 9.7 11.8
1.23 1.26 9.0 10.3 10.0 12.3
1.28 1.31 9.4 10.7 10.4 12.7
1.32 1.35 9.7 11.1 10.8 13.2
1.37 1.40 10.1 11.5 11.2 13.7
1.42 1.45 10.4 11.9 11.6 14.1
1.47 1.50 10.8 12.3 12.0 14.6
1.51 1.55 11.1 12.7 12.4 15.1
1.56 1.60 11.5 13.1 12.7 15.5
1.61 1.64 11.8 13.5 13.1 16.0
1.65 1.69 12.1 13.9 13.5 16.5
1.70 1.74 12.5 14.3 13.9 16.9
32
PROJECT POWERHOUSE
- --------------------------------------------------------------------------------
Summary Timeline - Juniper Transaction
Date Activity
- ---- --------
September 21 Decision by families to proceed
September 28 Juniper Board Meeting, retain financial and legal advisors
for Juniper
October 15 Fourth quarter earnings release, negotiations with Juniper
Representatives
October 22, 23 Juniper Board Meeting, approval of proposed transaction
October 25 Public announcement, commencement of tender offer
November 5 Distribute proxy materials for Annual Shareholder Meeting
November 30 Annual Shareholder Meeting
December 8 Accept shares for payment
February 14 Juniper and Japanese Newco Shareholder Meetings to approve
merger of Juniper into Japanese Newco
March 27 Initiate process to deregister and delist in Japan
33
PROJECT POWERHOUSE
- --------------------------------------------------------------------------------
Summary Timeline - Apple Transaction
Date Activity
September 21 Decision by families to proceed
September 28 Apple Board Meeting, retain financial and legal advisor for
Apple
October 12 Fourth quarter earnings release, negotiations with Apple
Committee ongoing
October 22 Apple Committee and Board Meetings to consider transaction
October 25 Public announcement, commencement of tender offer
December 8 Accept shares for payment
January 10 Apple Shareholder Meeting to approve merger of Apple with
and into Bermuda Newco, initiate process to delist shares on
NYSE and ASE
34
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Trading Statistics of Selected Comparable Companies (1)
Share Price /
----------------
Market Value Equity / Projected 99E P/E /
Share ---------------------- EPS (3) Book 5-Year 5-Year
Company Price Equity Aggregate (2) 1999E 2000E Value Growth (3) Growth (3)
- ------- ----- ------ ------------- ----- ----- ----- ---------- ----------
(9/17/99) ($MM) ($MM)
DIRECT MARKETERS
- ----------------
Avon Products $39.938 $10,415 $10,859 23.4 x 20.3 x NM x 15.0% 1.4 x
Blyth Industries 31.125 1,509 1,631 16.8 14.0 4.6 20.0% 0.7
Nature's Sunshine Products 9.438 165 141 8.7 7.6 2.2 NA NA
Nu Skin Enterprises 12.938 1,134 1,122 11.9 10.2 3.9 20.0% 0.5
Tupperware 20.750 1,196 1,529 13.8 12.2 9.3 11.0% 1.1
-------------------------------------------------------------------------------------------------------
MEAN 14.9 x 12.8 x 5.0 x 16.5% 0.9 x
MEDIAN 13.8 12.2 4.3 17.5% 0.9
-------------------------------------------------------------------------------------------------------
CONSUMER PRODUCTS
- -----------------
Land's End 59.438 1,792 1,810 30.2 25.6 7.0 15.0% 1.7
Newell Rubbermaid 31.313 8,828 10,889 18.6 14.9 3.3 15.0% 1.0
Enesco Group (5) 16.875 233 264 11.6 9.1 2.1 10.0% 0.9
-------------------------------------------------------------------------------------------------------
MEAN 20.2 x 16.5 x 4.1 x 13.3% 1.2 x
MEDIAN 18.6 14.9 3.3 15.0% 1.0
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
MEAN 16.9 x 14.2 x 4.6 x 15.1% 1.0 x
MEDIAN 15.3 13.1 3.9 15.0% 1.0
-------------------------------------------------------------------------------------------------------
Apple (6) 11.750 663 562 NM 24.1 3.6 17.5% 1.4
Juniper (6) 10.198 1,472 1,302 16.8 16.4 3.2 2.0% 8.2
AGGREGATE VALUE (2) /
-----------------------------------------------------------------------------
REVENUES (4) EBITDA (4) EBIT (4)
----------------- ------------------- ---------------- DIVIDEND
COMPANY LTM 1999E LTM 1999E LTM 1999E YIELD
- ------- ----- ------- ------- -------- ----- ----- --------
DIRECT MARKETERS
- ----------------
Avon Products 2.1 x 2.0 x 15.4 x 13.3 x 17.3 x 14.8 x 1.8%
Blyth Industries 1.8 1.5 10.4 9.1 12.1 10.5 0.0%
Nature's Sunshine Products 0.5 NA 3.6 NA 4.1 NA 1.4%
Nu Skin Enterprises 1.2 1.3 6.3 6.9 7.2 8.1 0.0%
Tupperware 1.5 1.4 8.3 7.9 12.7 12.0 4.2%
----------------------------------------------------------------------------------------
MEAN 1.4 x 1.5 x 8.8 x 9.3 x 10.7 x 11.3 x 1.5%
MEDIAN 1.5 1.5 8.3 8.5 12.1 11.2 1.4%
----------------------------------------------------------------------------------------
CONSUMER PRODUCTS
- -----------------
Land's End 1.3 1.2 18.0 15.3 22.3 18.8 0.0%
Newell Rubbermaid 1.7 1.7 12.7 8.8 15.4 11.5 2.6%
Enesco Group (5) 0.7 0.7 5.9 5.7 7.0 6.5 6.6%
----------------------------------------------------------------------------------------
MEAN 1.2 x 1.2 x 12.2 x 9.9 x 14.9 x 12.3 x 3.1%
MEDIAN 1.3 1.2 12.7 8.8 15.4 11.5 2.6%
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
MEAN 1.3 x 1.4 x 10.1 x 9.6 x 12.3 x 11.7 x 2.1%
MEDIAN 1.4 1.4 9.4 8.8 12.4 11.5 1.6%
----------------------------------------------------------------------------------------
Apple (6) 1.1 1.1 16.8 14.0 26.4 20.4 0.0%
Juniper (6) 1.0 1.0 7.5 7.8 8.3 8.8 9.2%
<FN>
- ---------------------------------
Notes: (1) All financial data is for continuing operations before extraordinary
and non-recurring items and cumulative effect of accounting changes.
(2) Aggregate value defined as equity market value plus total debt, minority
interest and preferred stock at book value less cash & cash equivalents
(3) Median I/B/E/S estimates as of 9/17/99
(4) Estimates based on most recent Value Line and analyst research
(5) Earnings projections based on Value Line.
(6) Projections based on management Juniper EPS based on
Merrill Lynch report dated 7/2/99.
35
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Trading Statistics for Selected Comparable Companies(1)
Market Equity/
% Change from Market Net Income(3)
Ticker Share Price 52 Week Equity Aggregate ---------------------------
Number Company 36411 High Value Value (2) FY98 FY99E FY00E
------ ------- ----- ---- ----- --------- ---- ----- -----
(YEN) (%) (YEN MM) (YEN MM)
Catalogue Sales
- -----------------
8165 Senshukai 1,984 YEN -1.0% 94,499 76,496 67.4 x 53.5 x 48.5 x
9937 Cecile 3540 -0.3% 142,839 131,511 NM 51.9 24.8
8248 Nissen 475 -26.9% 11,653 54,764 18.8 20.9 9.0
8005 Mutow 710 -2.7% 19,093 22,227 13.4 23.4 NA
----------------------------------------------
Mean: 33.2 x 37.4 x 27.5 x
Median: 18.8 37.6 24.8
----------------------------------------------
Direct (Door-to-Door) Sales
- ---------------------------
9885 Charle 1,381 -13.7% 29,049 11,537 13.4 x 15.4 x 14.5 x
8205 Shaklee 985 -17.9% 25,531 18,224 30.9 30.0 29.7
4915 Avon Products 280 -12.5% 16,996 16,587 NM 127.3 42.4
----------------------------------------------
Mean: 22.2 x 57.6 x 28.9 x
Median: 22.2 30.0 29.7
----------------------------------------------
----------------------------------------------
Total Mean: 28.8 x 46.1 x 28.2 x
Total Median: 18.8 30.0 27.3
----------------------------------------------
PROJECT POWERHOUSE
- ------------------------------------------------------------------------------------------------------------------------------------
Trading Statistics for Selected Comparable Companies(1)
Market Equity/
-------------------- Aggregate Value/ LTM 2 Yrs. Est.
Ticker CE(4) Book ---------------------------------- Earnings
Number Company FY98 Equity EBIT(5) EBITDA(6) Sales Growth (7)
------ ------- ---- ------ ------- --------- ----- ----------
Catalogue Sales
---------------
8165 Senshukai 20.2 x 1.4 x 22.3 x 11.4 x 0.5 x 17.9%
9937 Cecile NM 3.5 43.7 32.1 0.8 NM
8248 Nissen 4.4 0.7 29.7 14.2 0.4 44.1%
8005 Mutow 8.6 1.0 14.7 9.7 0.3 NA
----------------------------------------------------------------------------------------------
MEAN: 11.1 x 1.7 x 27.6 x 16.9 x 0.5 x 31.0%
MEDIAN: 8.6 1.2 26.0 12.8 0.4 31.0%
----------------------------------------------------------------------------------------------
Direct (Door-to-Door) Sales
- ---------------------------
9885 Charle 11.8 x 1.1 x 2.5 x 2.4 x 0.2 x -3.8%
8205 Shaklee 20 1.9 10.1 8.0 1.5 NA
4915 Avon Products 29 3.0 28.5 12.6 0.5 NM
----------------------------------------------------------------------------------------------
MEAN: 20.2 x 2.0 x 13.7 x 7.6 x 0.7 x -3.8%
MEDIAN: 19.5 1.9 10.1 8.0 0.5 -3.8%
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
MEAN: 15.6 x 1.8 x 21.7 x 12.9 x 0.6 x 19.4%
MEDIAN: 15.7 1.4 22.3 11.4 0.5 17.9%
----------------------------------------------------------------------------------------------
====================================================================================================================================
<FN>
- -------------------------------------------------
Notes: (1) Source: FY1998 Yuka Shoken Hokokusyo (consolidated except for Cecile, Shaklee, Avon Products)
Fiscal Year ends in 3/99 except for Nissen and Avon Products
(2) Aggregate Value = Market Equity Value + Total Debt - Cash
(3) EPS Estimates from IBES except for Kao which is based on Morgan Stanley Dean Witter Research Estimate
(4) CE = Net Income + Depreciation & Amortization.
(5) EBIT = Recurring Profit + Interest Expense
(6) EBITDA = EBIT + Depreciation & Amortization
36
PROJECT JUMPSTART
- --------------------------------------------------------------------------------
TENDER OFFER CASE STUDIES
- --------------------------------------------------------------------------------
NCR JAPAN, INC.
- --------------------------------------------------------------------------------
Business Description
- --------------------
NCR Corporation's largest subsidiary and its only publicly traded regional unit.
NCR Japan is engaged in imports and sales of large computers produced at NCR.
NCR Corporation is a manufacturer of automated teller machines and point-of-sale
terminals. The Company also provides financial transaction services.
NCR Corporation acquired 97.7% of NCR Japan, Ltd.
Transaction Detail Premium Offered Over Market
- -------------------------------------- ---------------------------------------------
Date of Announcement 4/16/98 Unaffected Day Prior to LTM LTM
Shares Outstanding as of 12/97:220.0MM Price(1) Announcement High Low
Tender Offer Price: 607 YEN ---------- ------------ ------ -----
35.2% 26.5% (37.7)% 69.6%
Initial Ownership Position: 70.0%
Ownership Sought in Tender: 30.0%
- --------------------------------------------------------------------------------
JAPAN MARINE TECHNOLOGIES
- --------------------------------------------------------------------------------
Business Description
- --------------------
Japanese Marine Technologies is the Japanese base for TI Group of the United
Kingdom. The Company produces stern tube sealing for ships, waste disposal
handling equipment for nuclear power stations and tilted pad bearing systems for
high speed handling of heavy loads. JMT also imports products from other TI
Group companies.
TI Group acquired 91.3% of Japan Marine Technologies.
Transaction Detail Premium Offered Over Market
- -------------------------------------- ---------------------------------------------
Date of Announcement 4/20/98 Unaffected Day Prior to LTM LTM
Shares Outstanding as of 12/97 9.8MM Price(1) Announcement High Low
Tender Offer Price: 580 YEN ---------- ------------ ------- -----
62.5% 56.8% (31.3)% 87.1%
Initial Ownership Position: 50.1%
Ownership Sought in Tender: 49.9%
- --------------------------------------------------------------------------------
NCR JAPAN, INC.
- --------------------------------------------------------------------------------
[SHARE PRICE PERFORMANCE SUMMARY CHART]
- --------------------------------------------------------------------------------
JAPAN MARINE TECHNOLOGIES
- --------------------------------------------------------------------------------
[SHARE PRICE PERFORMANCE SUMMARY CHART]
Notes: (1) Unaffected price represents market price one month prior to
announcement date.
(2) Central Bank in Thailand stopped defending baht's fixed value
against the dollar.
37
PROJECT JUMPSTART
- --------------------------------------------------------------------------------
TENDER OFFER CASE STUDY - SDS BIOTECH
[SHARE PRICE PERFORMANCE SUMMARY CHART]
- --------------------------------------------------------------------------------
TRANSACTION DETAIL
- --------------------------------------------------------------------------------
Summary Tender Offer Terms
- --------------------------
Date of Announcement: 2/2/98
Date of Completion: 4/23/98
Shares Outstanding as of 12/97: 9.0MM
Tender Offer Price: 1550 YEN
Initial Ownership Position: 33.8%
Ownership Sought in Tender: 66.2%
Ownership Following Tender 97.8%
Comments
- --------
- -- Novartis' 4.9MM shares accounted for 54.8% of the total shares outstanding
- -- The remaining 11.4% of the shares outstanding were held mainly by Japanese
banks
- --------------------------------------------------------------------------------
PREMIUM PAID
- --------------------------------------------------------------------------------
Premium Offered Over Market
- ---------------------------------------------------------------
Unaffected Day Prior to LTM LTM
Price(1) Announcement High Low
- ------------- ------------ ---- -----
62.5% 74.2% 5.4% 80.9%
Notes: (1) Unaffected price represents market price one month prior to
announcement date.
(2) Central Bank in Thailand stopped defending baht's fixed value
against the dollar.
38
PROJECT JUMPSTART
- --------------------------------------------------------------------------------
SONY CASE STUDY - TRANSACTION OVERVIEW
Description: - Privatization of three listed subsidiaries, Sony Music Entertainment (SMEJ), Sony Chemicals
Corporation (SC), and Sony Precision Technology (SPT) by Sony
Structure: - 100% stock transaction
- Fixed exchange ratio
-- 0.835 SMEJ share, 0.565 SC share, and 0.203 SPT share for each Sony share
Total Transaction Size: - JPY 330BN ($2.8BN)
Premium: Premium to Marker SMEJ SC SPT
----------------- ---- -- ---
3 Months Before Announcement 29% 2% 14%
1 Month Before Announcement 21% 12% 14%
1 Day Before Announcement 16% 19% 18%
Conditions to Close: - Approval of Sony and subsidiary boards (expected in Oct. 1999)
- Approval of Sony and subsidiary shareholders (expected in Nov. 1999)
- Implementation of the stock-for-stock provision in the revised Commercial Code for 100% stock
transaction.
Expected Closing: - January 2000