SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Amendment No. 3
to
Schedule TO
Tender
Offer Statement under Section
14(d)(1)
or 13(e)(1) of the Securities Exchange Act of 1934
| LIMITED BRANDS, INC. |
| (Name of Issuer) |
| LIMITED BRANDS, INC. (Issuer) |
| (Name of Filing Person (Identifying Status as Offeror, Issuer or Other Person)) |
| Common Stock, $0.50 Par Value |
| (Title of Class of Securities) |
| 532716107 |
| (CUSIP Number of Class of Securities) |
| Samuel P. Fried |
| Senior Vice President, General Counsel and Secretary |
| Limited Brands, Inc. |
| Three Limited Parkway |
| P.O. Box 16000 |
| Columbus, Ohio 43216 |
| Telephone (614) 415-7000 |
| (Name, Address and Telephone Number of Person Authorized to |
| Receive Notices and Communications on Behalf of Filing Persons) |
| Copy to: |
| Dennis S. Hersch |
| David L. Caplan |
| Davis Polk & Wardwell |
| 450 Lexington Avenue |
| New York, New York 10017 |
| Telephone: (212) 450-4000 |
CALCULATION OF FILING FEE |
| Transaction Valuation* | Amount of Filing Fee** | |
| $2 billion | $253,400 |
| * | Calculated solely for the purpose of determining the amount of the filing fee. This amount is based upon the purchase of 80,000,000 outstanding shares of Common Stock at the maximum tender offer price of $25.00 per share. |
| ** | The amount of the filing fee, calculated in accordance with Rule 0-11 of the Securities Exchange Act of 1934, as amended, and Fee Advisory #7 for Fiscal Year 2004 issued by the Securities and Exchange Commission, equals $126.70 per million of the value of the transaction. |
[x] Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
| Amount Previously Paid: | $253,400 | Filing Party: | Limited Brands, Inc. | |||
| Form of Registration No.: | Schedule TO | Date Filed: | October 7, 2004 | |||
[ ] Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the statement relates:
[ ] third-party
tender offer subject to Rule 14d-1
[x] issuer tender offer subject to Rule 13e-4
[ ]
going-private transaction subject to Rule 13e-3
[ ]
amendment to Schedule 13D under Rule 13d-2
Check the following box if the filing is a final amendment reporting the results of the tender offer: [ ]
This Amendment No. 3 amends and supplements the Tender Offer Statement on Schedule TO originally filed with the Securities and Exchange Commission on October 7, 2004, as amended and supplemented by Amendment No. 1 to the Tender Offer Statement filed with the Securities and Exchange Commission on October 12, 2004 and Amendment No. 2 to the Tender Offer Statement filed with the Securities and Exchange Commission on October 21, 2004 (the “Schedule TO”) by Limited Brands, Inc., a Delaware corporation (the “Company”), relating to the offer by the Company to purchase up to 80,000,000 shares of its common stock, $0.50 par value per share (the “Shares”), or such lesser number of Shares as is properly tendered and not properly withdrawn, at a price determined by the Company between $21.75 and $25.00 per Share, without interest, on the terms and subject to the conditions set forth in an Offer to Purchase, dated October 7, 2004 and in the related Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the “Offer”). This Amendment No. 3 is intended to satisfy the reporting requirements of Rule 13e-4(c)(3) of the Securities Exchange Act of 1934, as amended. Copies of the Offer to Purchase and the related Letter of Transmittal were previously filed with the Schedule TO as Exhibits (a)(1)(i) and (a)(1)(ii), respectively.
The information in the Offer is incorporated in this Amendment No. 3 to the Schedule TO by reference in response to all of the applicable items in the Schedule TO, except that such information is hereby amended and supplemented to the extent specifically provided herein.
Item 11. Additional Information
Item 11 of the Schedule TO is hereby amended and supplemented by inserting “(i)” immediately following “(b)” and adding the following paragraph:
(b)(ii) On October 20, 2004, the Company held an investor update meeting. Copies of presentation materials from such meeting are filed as Exhibits (a)(5)(iii), (a)(5)(iv) and (a)(5)(v) to this Schedule TO and are incorporated herein by reference.
Item 12. Exhibits
Item 12 of the Schedule TO is hereby amended and supplemented by adding the following:
| (a)(5)(iii) | October 20, 2004 investor update meeting presentation materials, part one. |
| (a)(5)(iv) | October 20, 2004 investor update meeting presentation materials, part two. |
| (a)(5)(v) | October 20, 2004 investor update meeting presentation materials, part three. |
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EXHIBIT INDEX
Item 12. Exhibits.
| (a)(1)(i) | Offer to Purchase dated October 7, 2004.* |
| (a)(1)(ii) | Letter of Transmittal (including Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9).* |
| (a)(1)(iii) | Notice of Guaranteed Delivery.* |
| (a)(1)(iv) | Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees dated October 7, 2004.* |
| (a)(1)(v) | Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees dated October 7, 2004.* |
| (a)(1)(vi) | Letter dated October 6, 2004 from Leslie H. Wexner, Chairman and Chief Executive Officer of Limited Brands, Inc.* |
| (a)(1)(vii) | Letter from Savings and Retirement Plan Administrative Committee, including Letter and Notice of Instructions, to all Participants in the Savings and Retirement Plan of Limited Brands, Inc. dated October 7, 2004.* |
| (a)(1)(viii) | Letter from Savings and Retirement Plan Administrative Committee to Participants in the Savings and Retirement Plan who are subject to Section 16 of the Securities and Exchange Act of 1934, as amended, dated October 7, 2004.* |
| (a)(1)(ix) | Letter from Computershare Trust Co., Inc. to all Participants in the Stock Purchase Plan of Limited Brands, Inc. dated October 7, 2004.* |
| (a)(1)(x) | Notice to Holders of Vested Stock Options dated October 7, 2004.* |
| (a)(5)(i) | Form of summary advertisement dated October 7, 2004.* |
| (a)(5)(ii) | Limited Brands Stock Tender Offer—Questions and Answers.* |
| (a)(5)(iii) | October 20, 2004 investor update meeting presentation materials, part one.** |
| (a)(5)(iv) | October 20, 2004 investor update meeting presentation materials, part two.** |
| (a)(5)(v) | October 20, 2004 investor update meeting presentation materials, part three.** |
| (b)(i) | Five-Year Revolving Credit Agreement, dated as of October 6, 2004, among Limited Brands, Inc., the Lenders party thereto, JPMorgan Chase Bank, as Administrative Agent, and Bank of America, N.A. and Citicorp North America, Inc., as Co-Syndication Agents.* |
| (b)(ii) | Term Loan Credit Agreement, dated as of October 6, 2004, among Limited Brands, Inc., the Lenders party thereto, JPMorgan Chase Bank, as Administrative Agent, and Bank of America, N.A. and Citicorp North America, Inc., as Co-Syndication Agents.* |
| (b)(iii) | Bridge Credit Agreement, dated as of October 6, 2004, among Limited Brands, Inc., the Lenders party thereto, JPMorgan Chase Bank, as Administrative Agent, and Bank of America, N.A. and |
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| Citicorp North America, Inc., as Co-Syndication Agents.* | |
| (d)(1) | Employment Agreement of Mark A. Giresi dated as of August 15, 2002, incorporated by reference to Exhibit 10.22 to the Company’s Annual Report on Form 10K for fiscal year ended February 1, 2003. |
| (d)(2) | Amendment to Employment Agreement of Mark A. Giresi dated as of May 19, 2003, incorporated by reference to Exhibit (d)(4) to the Company’s Tender Offer statement on Schedule TO (file no. 00533912) dated February 27, 2004. |
| (d)(3) | Employment Agreement of Leonard A. Schlesinger dated as of July 31, 2003, incorporated by reference to Exhibit 10 to the Company Quarterly Report on Form 10-Q for quarterly period ended August 2, 2003. |
| (d)(4) | Employment Agreement of V. Ann Hailey dated as of January 2, 2004, incorporated by reference to Exhibit (d)(6) to the Company’s Tender Offer statement on Schedule TO (file no. 005-33912) dated February 27, 2004. |
| (d)(5) | Limited Brands Stock Award and Deferred Compensation Plan for Non-Associate Directors, incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-8 filed November 13, 2003. |
| (d)(6) | Limited Brands 1993 Stock Option and Performance Incentive Plan (2004 Restatement), incorporated by reference to Appendix A to the Company’s Proxy Statement on Form 14A dated May 17, 2004. |
| (d)(7) | Intimate Brands 1995 Stock Option and Performance Incentive Plan (1997 Restatement), incorporated by reference to Exhibit B to the Company’s Proxy Statement on Form 14A dated April 14, 1997. |
| * | Previously filed on Schedule TO on October 7, 2004. |
| ** | Filed herewith. |
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| LIMITED BRANDS, INC. | ||
| By: | /s/ Timothy J. Faber | |
| Name: Timothy J. Faber | ||
| Title: Vice President, Treasury | ||
| / Mergers & Acquisitions | ||
Dated: October 21, 2004
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Leslie H. Wexner Chairman Chief Executive Officer Limited Brands, Inc.
Achieve our Mission
|
Limited brands - ------------------------------------------------------------------------------ V. Ann Hailey - ---------------------------- EXECUTIVE VICE PRESIDENT & CHIEF FINANCIAL OFFICER LIMITED BRANDS, INC. |
|
Limited brands - ------------------------------------------------------------------------------ Agenda: [X] Business Overview [X] Financial Performance Review [X] Recapitalization Rationale |
|
Limited brands - ------------------------------------------------------------------------------ We continue to pursue our vision of a Family of the World's Best Fashion Brands Our core strategies have not changed: [X] Building stronger Brands [X] Recruiting, developing and retaining world class Talent [X] Creating industry leading Capabilities |
|
Limited brands - ------------------------------------------------------------------------------ 1995 - 2004 YTD Restructured Portfolio - ---------------------- o Exited Abercrombie & Fitch, Limited Too, Brylane, Penhaligon's, Cacique, Galyan's, Alliance Data Systems, Lane Bryant, Mast joint ventures, Lerner New York, aura science o Recombined Limited, Inc. and Intimate Brands Built Stronger Brands - --------------------- o Closed almost 1,800 underperforming stores o Opened 1,913 stores in growth brands o Rebranded Structure to Express Men Returned Value to Shareholders - ------------------------------ o $4.2 billion in share repurchases (including ANF split-off) o $1.4 billion in dividends o Spun off Limited Too |
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Limited brands - ------------------------------------------------------------------------------ Sales from apparel brands are less than a third of our business today |
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Limited brands - ------------------------------------------------------------------------------ We are focused on developing key product categories that provide a stable revenue stream - - Victoria's Secret: 75% of bra sales are in core styles and basic colors - - Bath & Body Works: 80% of sales are generated from businesses that have continuity - - Express: We will sell 3.4 million units of the Editor Pant, and have launched Express Design Studio as a platform for more consistency |
|
Limited brands - ------------------------------------------------------------------------------ Victoria's Secret Lingerie / Beauty / Direct |X| Continued focus on developing successful sub-brands, led by the new Pink lingerie line, Body By Victoria, Angels and Very Sexy |X| Building Beauty sub-brands, including Very Sexy for Her 2, aura science, hair care and our new fragrance, "Basic Instinct" |X| Further growth at Victoria's Secret Direct - Continued focus on best-at bras and "Body at Work" - Internet demand is projected to increase significantly versus 2003, representing almost 50% of total demand in 2004 |
|
Limited brands - ------------------------------------------------------------------------------ Bath & Body Works |X| Redefined the brand to Modern Apothecary of Beauty and Wellbeing |X| Continued focus on new product identification and commercialization - - Henri Bendel, Le Couvent de Minimes, Tutti Dulci, Bigelow, Aromatherapy Remedies, Pure Simplicity |X| Repositioned our promotional strategy |
|
Limited brands - ------------------------------------------------------------------------------ Express |X| Express is redefining the brand to be more sophisticated through higher quality fabrics, less promotional activity, and an expanded wear-to-work offering. Express Design Studio, launched in Fall 2004, is the catalyst for this assortment change |X| Conversion to dual gender |
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Limited brands - ------------------------------------------------------------------------------ Limited Stores |X| Improvement in profit results are being driven by the new promotional strategy and by a core focus on improving efficiency |
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Limited brands - ------------------------------------------------------------------------------ As a portfolio, our brands deliver strong operating income and free cash flow: 2003 ------------------------------------------ Victoria's Secret BBW Apparel ----------------- --- ------- Sales $3,817 $1,934 $2,697 LL% 4% 8% 0% Operating Income 711 355 91 % of Sales 18.6% 18.4% 3.4% Free Cash Flow $ 399 $ 251 $ 22 |
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Limited brands - ---------------------------------------------------------------------------------------------------------------- Our businesses are strong cash generators. 2000-2004 2000-2004 2000 2001 2002 2003 2004E* Average Cumulative ------ ------ ------- ------ ------ ------- ---------- Cash From Operations $ 822 $1,004 $795 $1,062 $1,036 944 4,719 Capital Expenditures (487) (377) (306) (293) (525) (398) (1,988) ------ ------- ------- ------- ------- ------- ------- Free Cash Flow 335 627 489 769 511 546 2,731 Dividends (128) (129) (150) (208) (233) (169) (848) ------ ------- ------- ------- ------- ------- ------- Retained Cash Flow 207 498 339 561 278 377 1,883 Other Investing and Financing Activities (469) 346 428 306 (864) (51) (253) ------ ------- ------- ------- ------- ------- ------- Net Change in Cash (262) 844 767 867 (586) 326 1,630 ------ ------- ------- ------- ------- ------- ------- Cash and Equivalents - Ending $ 651 $ 1,495 $ 2,262 $ 3,129 $ 2,543 $ 2,016 $ 2,543 ------ ------- ------- ------- ------- ------- ------- *Excludes impact of recapitalization transaction |
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Limited brands - -------------------------------------------------------------------------------- Alternatives Considered: [x] Share repurchase [x] Dividends >> Regular >> Special [x] Acquisitions [x] Increased investment in our business |
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Limited brands - ---------------------------------------------------------------------------------------------------------------- Transaction Summary - ------------------- |X| $2 billion share repurchase through modified "Dutch Auction"; $500 million post tender special dividend |X| Commenced October 7, 2004; will close November 4th, unless extended |X| Use $1.5 billion of cash on hand |X| Raise $1.0 billion of new debt |X| Replace existing $750 million revolving credit facility with a new $1.0 billion 5-year revolving credit facility |X| Structure the transaction to protect our investment grade rating |
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Limited brands - -------------------------------------------------------------------------------- Objectives of the Transaction: |X| Provide value for shareholders who wish to sell stock |X| Demonstrate confidence in our business and provide an opportunity for shareholders who wish to increase their stake in the Company |X| Establish a more appropriate capital structure |X| Maintain financial flexibility and a strong balance sheet |X| Provide value to continuing shareholders |
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Limited brands - -------------------------------------------------------------------------------- This transaction will have a significant impact on our capital structure: [X] Our weighted average cost of capital (WACC) will decrease [X] Our return on invested capital (ROIC) will increase. |
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Limited brands - -------------------------------------------------------------------------------- The $2.5 billion transaction would increase our Pro Forma return on invested capital by almost 4 percentage points in 2004: 2004 2004 Forecast Pro Forma(2) Beginning Invested Capital 6,538 5,038 Ending Invested Capital 5,860 4,359 Average Invested Capital(1) 6,199 4,699 Net Operating Profit After Taxes 750 750 ----- ----- Return On Invested Capital 12.1% 16.0% ----- ----- (1) Invested capital excluding goodwill (2) Proforma amounts reflect the impact of the $2 Billion Tender Offer, the $500 Million Special Dividend and $1 Billion of additional long-term debt as if the transactions occurred at the beginning of the year |
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Limited brands - -------------------------------------------------------------------------------- The transaction would be about 14% accretive to pro forma 2004 earnings: Adjusted Pro Forma Pro Forma 2004E Adjustments 2004E % Change -------- ----------- --------- -------- Net Income 646 (40) 606 (6%) Diluted EPS $1.33 $1.52 14% Weighted Average Shares Outstanding 486 (87) 399 (18%) |
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Limited brands - ---------------------------------------------------------------------------------------------------------------- In Summary: [X} We have repositioned the business; a majority of our revenues are lingerie and personal care/beauty [X} Our brands are well positioned for growth [X} Our new capital structure is appropriate for our current mix of businesses [X} We are a returns based company with over $3.8 billion returned to shareholders in 2004 and an increasing ROIC |
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Pathways to Market Recent Projects Pink Express Design Studio Center Creative Team Ideation for Pink and EDS BBW Holiday Limited Design Services Henri Bendel Candle and Personal Care Tutti Dolci Outside partners Intimissimi Buy off existing lines BBW, VS, Bendel flagship strategies (beauty and lingerie) Ongoing retail testing for concept validation Co-development partnerships Bigelow L'Occitane (Le Couvent Des Minimes) Chantal Thomass (VS) Multiple other beauty discussions in progress with/for BBW, VS, Bendel Acquisition TBD |