TETERBORO, N.J., and TARZANA, Calif., Dec. 2 /PRNewswire-FirstCall/ --
Quest Diagnostics Incorporated (NYSE: DGX) and Unilab Corporation
(Nasdaq: ULAB) announced that they are in discussions to amend the terms of
their previously announced transaction in conjunction with discussions with a
third party to sell certain assets in Northern California to address concerns
of the Federal Trade Commission regarding the transaction.
The proposed changes would include reducing the value of the overall
transaction by approximately $60 million, based on the closing price of Quest
Diagnostics common stock on November 29, 2002. This would result in Unilab
shareholders having the right to elect either 0.3424 shares of Quest
Diagnostics common stock or $19.10 in cash. Quest Diagnostics would not issue
more than the 8.5 million shares or pay more than the $297 million in cash
currently contemplated by the existing Merger Agreement. Based on these
amounts, up to but not more than approximately 42% of the outstanding Unilab
shares may be exchanged for cash and up to but not more than approximately 66%
of the outstanding Unilab shares can be converted into Quest Diagnostics
shares. Under terms of the existing Merger Agreement, Unilab shareholders
would have received a blended value of $20.67 per share based on the closing
price of Quest Diagnostics common stock on November 29.
Currently, the Merger Agreement between Quest Diagnostics and Unilab can
be terminated by either party at any time after November 30, if the Cash
Election Exchange Offer has not been completed on or before that date. The
proposed changes would also include extending the termination date of the
Merger Agreement until January 31, 2003. The Cash Election Exchange Offer is
currently scheduled to expire at midnight on Thursday, December 5, 2002,
unless extended.
The companies now expect the transaction to be completed within 30 to 60
days.
Quest Diagnostics and Unilab are strongly committed to completing the
transaction. They continue to be involved in active discussions, which include
settlement discussions, with the Federal Trade Commission. Quest Diagnostics
and Unilab continue to believe that the transaction is not anti-competitive.
Any agreements reached regarding the potential divestiture are subject to FTC
approval.
In addition, the proposed changes are subject to the approval of the
Boards of Directors of the respective companies at meetings anticipated to be
held later this week. If approved by the Boards, additional details, including
the terms of the proposed divestiture, are expected to be announced promptly
thereafter; the changes will be described in the parties' respective SEC
filings and distributed to Unilab stockholders.
Merrill Lynch is the Dealer Manager for the exchange offer and may be
contacted toll free at 866-276-1462.
About Unilab
Unilab Corporation is the largest provider of clinical laboratory testing
services in California through its primary testing facilities in Los Angeles,
San Jose and Sacramento and over 400 patient service centers and rapid
response laboratories located throughout the state. Additional information is
available on the Company's website at: http://www.unilab.com .
FORWARD-LOOKING STATEMENTS:
This communication contains certain forward-looking statements under the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements, which may include, but are not limited to, statements concerning
the financial condition, results of operations and business of Unilab, are
based on management's current expectations and estimates and involve risks and
uncertainties that could cause actual results or outcomes to differ materially
from those contemplated by the forward-looking statements. Certain of these
risks and uncertainties are described in Unilab's most recent reports on Form
10-Q, most recent reports on Form 10-K and other periodic reports filed by
Unilab with the Securities and Exchange Commission.
About Quest Diagnostics
Quest Diagnostics Incorporated is the nation's leading provider of
diagnostic testing, information and services, providing insights that enable
physicians, hospitals, managed care organizations and other healthcare
professionals to make decisions to improve health. The company offers the
broadest access to diagnostic laboratory services through its national network
of laboratories and patient service centers. Quest Diagnostics is the leading
provider of esoteric testing, including gene-based medical testing, and
empowers healthcare organizations and clinicians with state-of-the-art
connectivity solutions that improve practice management. Additional company
information can be found on the Internet at: http://www.questdiagnostics.com .
FORWARD-LOOKING STATEMENTS:
This communication contains certain forward-looking statements. These
forward-looking statements, which may include, but are not limited to,
statements concerning the financial condition, results of operations and
businesses of Quest Diagnostics and Unilab and the benefits expected to result
from the contemplated transaction, are based on management's current
expectations and estimates and involve risks and uncertainties that could
cause actual results or outcomes to differ materially from those contemplated
by the forward-looking statements.
Factors that could cause or contribute to such differences may include,
but are not limited to, the risk that the conditions relating to the required
minimum tender of Unilab shares or regulatory clearance might not be satisfied
in a timely manner or at all, risks relating to the integration of the
technologies and businesses of Quest Diagnostics and Unilab, unanticipated
expenditures, changing relationships with customers, suppliers and strategic
partners, conditions of the economy and other factors described in the most
recent reports on Form 10-Q, most recent reports on Form 10-K, and other
periodic reports filed by Quest Diagnostics and Unilab with the Securities and
Exchange Commission.
ADDITIONAL INFORMATION:
On May 15, 2002, Quest Diagnostics filed a Registration Statement on Form
S-4, as amended, and a Schedule TO, as amended, and Unilab filed a
Solicitation/Recommendation Statement on Schedule 14D-9, as amended, with the
Securities and Exchange Commission in connection with the transaction. A
Prospectus, which is part of the Registration Statement on Form S-4, the
Solicitation/Recommendation Statement on Schedule 14D-9, and related exchange
offer materials, including a letter of election and transmittal, has been
mailed to stockholders of Unilab. In addition, Quest Diagnostics has
previously filed a Statement on Schedule 13D, as amended, relating to its
agreement with Kelso Investment Associates VI, L.P. and KEP VI, LLC.
Investors and stockholders of Unilab are urged to read all of these documents
carefully. These documents contain important information about the
transaction and should be read before any decision is made with respect to the
exchange offer. Investors and stockholders are able to obtain free copies of
these documents through the website maintained by the Securities and Exchange
Commission at http://www.sec.gov. Free copies of these documents may also be
obtained from Quest Diagnostics by directing a request to Quest Diagnostics
Incorporated at One Malcolm Avenue, Teterboro, New Jersey, 07608, or from
Unilab by directing a request to Unilab Corporation at 18448 Oxnard Street,
Tarzana, California, 91356.
In addition to the Registration Statement on Form S-4, Schedule TO,
Prospectus, Solicitation/Recommendation Statement on Schedule 14D-9 and
related exchange offer materials, both Quest Diagnostics and Unilab file
annual, quarterly and special reports, proxy statements and other information
with the Securities and Exchange Commission.
You may read and copy any reports, Statements or other information filed
by Quest Diagnostics or Unilab at the SEC public reference room at 450 Fifth
Street, N.W., Washington, D.C., 20549, or at any of the Securities and
Exchange Commission's other public reference rooms in New York, New York and
Chicago, Illinois. Please call the Securities and Exchange Commission at
800-SEC-0330 for further information on the public reference rooms. Quest
Diagnostics' and Unilab's filings with the Securities and Exchange Commission
are also available to the public from commercial document-retrieval services
and at the website maintained by the Securities and Exchange Commission at
http://www.sec.gov.
SOURCE Quest Diagnostics Incorporated; Unilab Corporation
/CONTACT: Investors, Laure Park, +1-201-393-5030, or Media, Gary Samuels,
+1-201-393-5700, for Quest Diagnostics Incorporated; or Brian Urban,
+1-818-758-6611, for Unilab Corporation/
/Web site: http://www.questdiagnostics.com