Filed by Swift Transportation Co., Inc.
Commission File No. 0-18605
Pursuant to Rule 425 under the Securities Act of 1933 and
deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934
Subject Company: M.S. Carriers, Inc.
Commission File No. 0-14781
Date: February 14, 2001
Except for historical information, all other information in this filing
consists of forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements include, but are not
limited to, statements concerning the proposed transaction, the combination's
expected accretiveness to Swift's earnings, Swift's post-merger market
capitalization, expectations regarding public offerings of shares, expected
synergies, and pro forma financial and other information. Such statements are
based upon the current beliefs and expectations of Swift's and M.S. Carriers'
management and are subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking statements. These
uncertainties include: the inability to obtain governmental approvals of the
merger on the proposed terms and schedule; the failure of Swift and M.S.
Carriers stockholders to approve the merger; the risk that the businesses will
not be integrated successfully; the risk that the revenue synergies and costs
savings anticipated from the merger may not be fully realized or may take longer
to realize than expected; the risk that the merger will not be accretive to
earnings within the time period estimated by management or at all; the risk that
additional insurance and claims reserves and expenses may be incurred;
disruptions from the merger making it more difficult to maintain relationships
with customers, employees or suppliers; and increased competition and its
effects on pricing, spending, third-party relationships and revenues. With
respect to Swift's financial results, these uncertainties include economic
cycles, inventory levels, fuel prices, demand for Swift's services, and other
factors outside of Swift's control. Additional factors that could cause Swift's
and M.S. Carriers' results to differ materially from those described in the
forward-looking statements can be found in the 1999 Annual Reports on Forms 10-K
of Swift and M.S. Carriers, filed with the Securities and Exchange Commission
and available at the Securities and Exchange Commission's internet site
(http://www.sec.gov).
The proposed transaction will be submitted to Swift's and M.S. Carriers'
stockholders for their consideration. Swift will file a registration statement
on Form S-4 that will include a joint proxy statement/prospectus. Stockholders
should read the joint proxy statement/prospectus regarding the proposed
transaction that will be filed with the SEC and mailed to stockholders. The
joint proxy statement/prospectus will contain important information that
stockholders should consider. Stockholders will be able to obtain a free copy of
the joint proxy statement/prospectus, as well as other filings containing
information about Swift and M.S. Carriers, without charge, at the SEC's internet
site (http://www.sec.gov). Copies of the joint proxy statement/prospectus and
the SEC filings that will be incorporated by reference in the joint proxy
statement/prospectus can also be obtained, without charge, by directing a
request to: Swift Transportation Co., Inc., 2200 South 75th Avenue, Phoenix, AZ
85043, Attention: Chief Financial Officer (602-269-9700).
Swift and M.S. Carriers and certain other persons named below may be
deemed to be participants in the solicitation of proxies of Swift's and M.S.
Carriers' stockholders to approve the transaction. The participants in this
solicitation may include the directors and executive officers of Swift and M.S.
Carriers. A detailed list of the names and interests of Swift's directors and
officers is contained in Swift's proxy statement for its 2000 annual meeting,
and a detailed list of the names and interests of M.S. Carriers' directors and
officers is contained in M.S. Carriers' proxy statement for its 2000 annual
meeting.
1
As of the date of this communication, none of the foregoing
participants individually beneficially owns in excess of 5% of Swift's common
stock, or 5% of M.S. Carriers' common stock, except that Jerry Moyes, CEO of
Swift beneficially owns more than 5% of the common stock of Swift and Michael S.
Starnes, CEO of M.S. Carriers, beneficially owns more than 5% of the common
stock of M.S. Carriers. Certain employees of M.S. Carriers, including
participants, may receive accelerated vesting of their stock options in
connection with the merger in accordance with their existing stock option
agreements. In addition, certain officers of M.S. Carriers, as a condition to
the closing of the merger, will enter into employment agreements that will
become effective upon completion of the merger. A description of the employment
agreements will be contained in the joint proxy statement/prospectus.
The following communications are filed herewith:
1. Press release of Swift issued February 13, 2001.
2. Press release of M.S. Carriers issued February 13, 2001.
2
1. Press release of Swift issued February 13, 2001.
For Immediate Release
SWIFT TRANSPORTATION MAKES ANNOUNCEMENT CONCERNING
M.S. CARRIERS TRANSACTION, FIRST QUARTER OUTLOOK,
AND INVESTOR PRESENTATION
Phoenix, Arizona--February 13, 2001--Swift Transportation Co., Inc.
(Nasdaq: SWFT) made the following announcement concerning its previously
announced merger agreement with M.S. Carriers, Swift's first quarter financial
outlook, and an upcoming investor presentation by management.
On December 11, 2000, Swift announced a merger agreement with M.S.
Carriers, Inc. under which 1.7 shares of Swift common stock would be exchanged
for each share of M.S. Carriers stock. M.S. Carriers recently announced a $1.6
million pretax charge to insurance and claims expense for the fourth quarter of
2000 and a $6.9 million restatement of retained earnings to reflect an increase
in claims reserves as of December 31, 1997. Chairman, President, and Chief
Executive Officer of Swift, Jerry Moyes, stated: "The adjustments do not
diminish Swift's commitment to the merger, which would make the combined company
the largest publicly-traded truckload motor carrier in North America. We
continue to believe that the combined companies will benefit from increased,
combined revenues; the talent of two experienced management teams; efficiencies
in tractor and trailer utilization; economies of scale in purchasing power;
increased operations in Mexico; cross-marketing opportunities among major
customers; unified, nationwide recruitment of drivers and owner/operators; and
our combined ownership in Transplace.com, an internet-based global
transportation logistics company. We intend to work with M.S. Carriers regarding
its methods of estimating claims reserves. In this connection, we expect that
further adjustments may be made to the combined companies' reserves in
connection with the merger."
Mr. Moyes also commented on the Company's outlook. Mr. Moyes stated: "Swift
is experiencing a very favorable driver situation. We believe many drivers seek
stronger, better capitalized companies such as Swift during a difficult trucking
environment. However, we believe freight demand continues to be soft and that
recent interest rate cuts by the Federal Reserve have not yet stimulated greater
economic activity among shippers. Based upon our fleet utilization over the
first six weeks of 2001, we expect Swift's financial results for the first
quarter to fall short of published analysts' expectations. Although it is too
early to determine the effect a slow economy for the first quarter may have on
Swift's results for the entire year, we expect that it could extend the time for
M.S. Carriers' operations to become accretive to our overall earnings."
Investors who are interested in additional information concerning Swift may
listen to a presentation to the investment community on February 15, 2001, at
the Deutsche Bank Alex. Brown 2001 Global Transportation Conference in Naples,
Florida. Swift will be represented by Jerry Moyes and William F. Riley, III,
Senior Executive Vice President and Chief Financial Officer. The presentation
will begin at 2:00 p.m. EST and will be available by simultaneous webcast at:
http://www.db.com/transport 2001.
3
Swift can be reached on the Web at www.swifttrans.com.
This press release contains statements that are forward-looking within the
meaning of the Private Securities Litigation Reform Act of 1995. Such statements
include, but are not limited to, statements concerning the proposed transaction
with M.S. Carriers, claims reserves, economic factors, and other information.
Such statements are based upon the current beliefs and expectations of Swift's
management and are subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking statements. With
respect to the merger transaction, these uncertainties include: the inability to
obtain governmental approvals of the merger on the proposed terms and schedule;
the failure of Swift and M.S. Carriers stockholders to approve the merger; the
risk that the businesses will not be integrated successfully; the risk that the
revenue synergies and costs savings anticipated from the merger may not be fully
realized or may take longer to realize than expected; the risk that the merger
will not be accretive to earnings within the time period estimated by management
or at all; the risk that additional insurance and claims reserves and expenses
may be incurred; disruptions from the merger making it more difficult to
maintain relationships with customers, employees or suppliers; and increased
competition and its effects on pricing, spending, third-party relationships and
revenues. With respect to Swift's financial results, these uncertainties include
economic cycles, inventory levels, fuel prices, demand for Swift's services, and
other factors outside of Swift's control. Additional factors that could cause
results to differ materially from those described in the forward-looking
statements can be found in the 1999 Annual Report on Form 10-K and all
subsequent periodic reports of Swift filed with the Securities and Exchange
Commission.
The proposed transaction with M.S. Carriers will be submitted to Swift's
and M.S. Carriers' stockholders for their consideration. Swift will file a
registration statement on Form S-4 that will include a joint proxy
statement/prospectus. STOCKHOLDERS SHOULD READ THE JOINT PROXY
STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION THAT WILL BE FILED WITH
THE SEC AND MAILED TO STOCKHOLDERS. THE JOINT PROXY STATEMENT/PROSPECTUS WILL
CONTAIN IMPORTANT INFORMATION THAT STOCKHOLDERS SHOULD CONSIDER. Stockholders
will be able to obtain a free copy of the joint proxy statement/prospectus, as
well as other filings containing information about Swift and M.S. Carriers,
without charge, at the SEC's internet site (http://www.sec.gov). Copies of the
joint proxy statement/prospectus and the SEC filings that will be incorporated
by reference in the joint proxy statement/prospectus can also be obtained,
without charge, by directing a request to: Swift Transportation Co., Inc., 2200
South 75th Avenue, Phoenix, AZ 85043, Attention: Chief Financial Officer
(602-269-9700).
Swift and M.S. Carriers and certain other persons named below may be deemed
to be participants in the solicitation of proxies of Swift's and M.S. Carriers'
stockholders to approve the transaction. The participants in this solicitation
may include the directors and executive officers of Swift and M.S. Carriers. A
detailed list of the names and interests of Swift's directors and officers is
contained in Swift's proxy statement for its 2000 annual meeting, and a detailed
list of the names and interests of M.S. Carriers' directors and officers is
contained in M.S. Carriers' proxy statement for its 2000 annual meeting.
4
As of the date of this communication, none of the foregoing participants
individually beneficially owns in excess of 5% of Swift's common stock, or 5% of
M.S. Carriers' common stock, except that Jerry Moyes, CEO of Swift beneficially
owns more than 5% of the common stock of Swift and Michael S. Starnes, CEO of
M.S. Carriers, beneficially owns more than 5% of the common stock of M.S.
Carriers. Certain employees of M.S. Carriers, including participants, may
receive accelerated vesting of their stock options in connection with the merger
in accordance with their existing stock option agreements. In addition, certain
officers of M.S. Carriers, as a condition to the closing of the merger, will
enter into employment agreements that will become effective upon completion of
the merger. A description of the employment agreements will be contained in the
joint proxy statement/prospectus.
This press release is being filed with the SEC pursuant to Rule 425 under
the Securities Act of 1933.
Contact:
William F. Riley, III
Senior Executive Vice President and CFO
602/269-9700
5
2. Press release of M.S. Carriers issued February 13, 2001.
FINAL FOR RELEASE
M.S. Carriers, Inc. Reports Fourth Quarter 2000 Financial Results
Contact: Joe Barrow (901) 344-4401
Phil Lutey (901) 344-4440
Memphis, Tenn. (February 13, 2001) -- M.S. Carriers, Inc. (NASDAQ: MSCA), an
irregular route truckload carrier, reports the following results for the quarter
and twelve months ending December 31, 2000:
Three Months Ended December 31 Twelve Months Ended December 31
2000 1999 % Change 2000 1999 % Change
Revenues $ 177.2 $ 163.6 8% $ 697.5 $ 620.4 12%
Operating Income $ 7.2 $ 15.3 -53% $ 42.0 $ 56.8 -26%
Net Income $ 1.5 $ 7.9 -81% $ 16.3 $ 30.6 -47%
Diluted Earnings Per $ 0.13 $ 0.62 -79% $ 1.42 $ 2.39 -41%
Share
(in millions except per share data)
Operating revenues for the fourth quarter of 2000 increased 8 percent to $177
million from $164 million in the same period 1999. Operating income for the
fourth quarter of 2000 was $7.2 million, a 53 percent decrease from $15 million
in the same period 1999. Net income for the quarter ending December 31, 2000 was
$1.5 million, an 81 percent decrease from $7.9 million in the fourth quarter
1999. Diluted earnings per share for the fourth quarter of 2000 was 13 cents per
share, a decrease of 79 percent from 62 cents per share for the same quarter
last year.
The quarter was negatively impacted by lower demand for truckload services,
which led to lower equipment utilization and higher non-revenue miles. Continued
high fuel costs adversely impacted results of operations as compared to the same
quarter of 1999.
In addition, during the fourth quarter of 2000, the Company modified its method
of estimating and accounting for accident, workers' compensation, cargo and
physical damage claims. The modification included applying actuarial loss
development factors to estimate claims. Using these modified procedures resulted
in a $1.6 million increase to insurance and claims expense during the fourth
quarter of 2000, and a $6.9 million restatement of retained earnings to reflect
an increase in claims reserves at December 31, 1997.
6
Mike Starnes, chairman and chief executive officer, said, "Our fourth quarter
results were negatively impacted by several factors. First, freight market
conditions that have been affecting the whole truckload industry had a large
impact to the quarter. Weak economic conditions hurt the general truckload
freight market and led to lower equipment utilization and higher percentage of
non-revenue miles. When compared to the fourth quarter of 1999, earnings were
reduced by approximately $0.25 per share by a combination of lower utilization
and increased deadhead. Rising fuel costs reduced quarterly earnings by $0.12
per share when compared to the fourth quarter of 1999. The charge to insurance
and claims expense during the fourth quarter of 2000 reduced earnings by $0.09
per share."
As previously announced, the Company entered a merger agreement with Swift
Transportation Co., Inc. on December 11, 2000. Management has reviewed the
charges related to insurance and claims as well as the results of the fourth
quarter 2000 with Swift, and has received confirmation from Swift that the
proposed merger is not affected and remains scheduled to close in the Spring of
2001.
The Company will hold a conference call regarding fourth quarter and year to
date 2000 earnings February 14, 2001 at 10:00 a.m. Eastern Standard Time. The
call may be accessed at (888) 400-7918 in the United States or (952) 556-2844
Internationally. The conference call will be available for replay from 3:30 p.m.
EST, February 14, 2001 until 12:00 a.m. EST, February 21, 2001 at (800) 475-6701
in the United States and (320) 365-3844 Internationally using access code
571648.
This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.This information
is in accordance with the company's current expectations and is subject to
certain risks and uncertainties that could cause actual results to differ
materially from those set forth in the forward-looking statements. With respect
to M.S. Carriers' financial results these uncertainties include, without
limitation, the following: M.S. Carriers will have reasonable success recruiting
and retaining experienced drivers and owner operators at the company's current
compensation level; demand and pricing for the markets served by M.S. Carriers
will remain at current levels; fuel will remain available and without rapid
price fluctuations; and the company's accident experience will remain at
historical levels. With respect to the proposed merger transaction with Swift
these uncertainties include, without limitation, the following: the inability to
obtain governmental approvals of the merger on the proposed terms and schedule;
the failure of M.S. Carriers and Swift stockholders to approve the merger; the
risk that the businesses will not be integrated successfully; the risk that the
revenue synergies and costs savings anticipated from the merger may not be fully
realized or may take longer to realize than expected; the risk that additional
insurance and claims reserves and expenses may be incurred; disruptions from the
merger making it more difficult to maintain relationships with customers,
employees or suppliers; and increased competition and its effects on pricing ,
spending, third-party relationships and revenues. Additional factors that could
cause results to differ materially from those described in the forward-looking
statements can be found in the 1999 Annual Report on Form 10-K of M.S. Carriers
with the Securities Exchange Commission.
This press release is being filed with the SEC pursuant to Rule 425 under the
Securities Act of 1933.
7
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M.S. CARRIERS, INC. AND SUBSIDIARIES
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STATEMENTS OF INCOME
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Three Months Ended Twelve Months Ended
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31-Dec 31-Dec
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2000 1999 2000 1999
- ------------------------------------------------------------------------------- -------------------------------------------------
Percent of Percent of Percent of Percent of
Revenue Revenue Revenue Revenue
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Operating Revenues $177,237,125 $163,568,172 $697,521,957 $620,414,137
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Operating Expenses:
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Salaries, wages and benefits 65,673,447 37.05% 47,636,246 29.12% 236,726,123 33.94% 184,676,598 29.77%
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Operations and maintenance 33,691,483 19.01% 26,551,414 16.23% 128,975,476 18.49% 97,946,624 15.79%
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Taxes and licenses 3,680,170 2.08% 2,586,416 1.58% 14,690,488 2.11% 12,663,778 2.04%
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Insurance and claims 7,114,446 4.01% 5,893,305 3.60% 23,212,634 3.33% 21,986,637 3.54%
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Communications and utilities 2,679,178 1.51% 2,064,206 1.26% 9,306,977 1.33% 7,907,923 1.27%
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Depreciation and amortization 16,980,576 9.58% 17,066,043 10.43% 70,665,611 10.13% 62,400,797 10.06%
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Gain on disposal of revenue equipment -228,362 -0.13% 166,482 0.10% -1,108,415 -0.16% -940,944 -0.15%
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Rent and purchased transportation 38,574,728 21.76% 45,175,538 27.62% 166,982,436 23.94% 171,572,280 27.65%
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Other 1,843,618 1.04% 1,176,304 0.72% 6,115,739 0.88% 5,407,423 0.87%
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Total Operating Expenses 170,009,284 95.92% 148,315,954 90.68% 655,567,069 93.99% 563,621,116 90.85%
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Operating Income 7,227,841 4.08% 15,252,218 9.32% 41,954,888 6.01% 56,793,021 9.15%
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Other Expense (income):
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Interest Expense 4,976,010 2.81% 3,695,795 2.26% 18,244,136 2.62% 12,591,491 2.03%
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Other 4,965 0.00% -652,993 -0.40% -1,447,566 -0.21% -3,220,837 -0.52%
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4,980,975 2.81% 3,042,802 1.86% 16,796,570 2.41% 9,370,654 1.51%
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Income before income taxes 2,246,866 1.27% 12,209,416 7.46% 25,158,318 3.61% 47,422,367 7.64%
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Income taxes 782,644 0.44% 4,348,615 2.66% 8,816,069 1.26% 16,834,942 2.71%
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Net income $1,464,222 0.83% $7,860,801 4.81% $16,342,249 2.34% $30,587,425 4.93%
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Diluted Earnings per share $0.13 $0.62 $1.42 $2.39
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Weighted Average Common Shares &
Common Share Equivalents 11,203,581 12,700,206 11,538,657 12,815,615
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8
M.S. CARRIERS, INC. AND SUBSIDIARIES
OPERATING STATISTICS
-------------------------------------- --------------------------------------
Three Months Ended Twelve Months Ended
31-Dec 31-Dec
2000 1999 2000 1999
Total Miles 139,810,349 123,527,595 539,712,330 472,955,460
Empty Miles 19,302,727 15,084,881 73,729,463 57,083,284
Empty Mile % 13.81% 12.21% 13.66% 12.07%
Trucking Revenue $174,221,286 $149,524,229 $662,462,483 $568,765,042
Revenue per Mile 1.246 1.210 1.227 1.202
Revenue per Loaded Mile 1.446 1.379 1.422 1.367
Ending Company Tractors 3,733 3,283 3,733 3,283
Ending Leased Owner Operators 718 562 718 562
Ending Owner Operators 678 743 678 743
Ending Tractors 5,129 4,588 5,129 4,588
Beginning Company Tractors 3,744 2,992 3,283 2,750
Beginning Leased Owner Operators 699 508 562 264
Beginning Owner Operators 688 786 743 739
Beginning Tractors 5,131 4,286 4,588 3,753
Utilization 2,092 2,169 2,110 2,263
Revenue per Tractor per Week $ 2,607 $ 2,625 $ 2,590 $ 2,721
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9
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M.S. CARRIERS, INC. AND SUBSIDIARIES
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Product Revenue Statistics
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Three Months Ended Twelve Months Ended
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31-Dec 31-Dec
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2000 1999 Change 2000 1999 Change
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Domestic Irregular Route Trucking 106,841 $ 90,637 18% $ 410,264 $ 355,083 16%
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International Irregular Route Trucking 36,607 33,343 10% 144,589 129,704 11%
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Dedicated Route Trucking 30,773 25,545 20% 107,609 83,978 28%
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Trucking Revenue 174,221 149,524 17% 662,462 568,765 16%
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Logistics Revenue - 19,289 -100% 36,952 68,214 -46%
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Inter Divisional Elimination and Other 3,016 (5,245) N/A (1,892) (16,565) N/A
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Total Revenue $ 177,237 $ 163,568 8% $ 697,522 $ 620,414 12%
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Trucking Operating Ratio 95.9% 90.2% -5.7 points 93.9% 90.4% -3.5 points
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Logistics Operating Ratio N/A 97.4% N/A 97.2% 97.0% -0.2 points
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Total Company Operating Ratio 95.9% 90.7% -5.2 points 94.0% 90.9% -3.1 points
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10