SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
----------------------
Date of Report (Date of earliest event reported): February 22, 1998
CHATTEM, INC.
(Exact name of registrant as specified in its charter)
Tennessee 0-5905 62-0156300
(State of (Commission File No.) (IRS Employer
incorporation) Identification No.)
1715 West 38th Street, Chattanooga, Tennessee 37409
(Address of principal executive offices, including zip code)
(423) 821-4571
(Registrant's telephone number, including area code)
Item 5. Other Events.
On February 22, 1998, Chattem, Inc. (the "Company"), a manufacturer of
health and beauty care products and the Sunsource line of dietary supplements,
announced that it had signed a definitive agreement to acquire the BAN
anti-perspirant and deodorant brand from Bristol-Myers Squibb Company. BAN has
been a leading brand in the anti-perspirant and deodorant market since its
launch in 1955 and is the leading roll-on anti-perspirant in the U.S. market
today. Net sales of BAN in the U.S. reached an estimated $97 million in 1997.
Pursuant to the terms of the acquisition agreement, the Company will
purchase all the assets, including patents and trademarks of BAN (excluding
Japan), for $165 million in cash, plus assumed liabilities. The transaction is
expected to close not later than March 31, 1998, pending expiration or
termination of the Hart-Scott-Rodino Antitrust Improvements Act waiting period,
and is not subject to further due diligence or financing. NationsBanc
Montgomery Securities LLC is acting as the Company's financial advisor.
The Company expects BAN to be immediately accretive to earnings. In
keeping with Chattem's history of brand acquisitions, it will make significant
expenditures to advertise and promote BAN following its acquisition. Fiscal
1997 pro forma revenues for the Company including BAN would be approximately
$250 million. Long term, the acquisition of BAN should provide a platform for
further growth through the acquisition and introduction of mass marketed, high
quality products.
All forward looking statements are subject to the risks and
uncertainties detailed in the Company's filings with the Securities and Exchange
Commission.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
February 24, 1998 CHATTEM, INC.
By: /s/ A. Alexander Taylor II
--------------------------------------
A. Alexander Taylor II
President and Chief Operating Officer