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FILED BY INTERNATIONAL GAME TECHNOLOGY (COMMISSION FILE NO. 001-10684) PURSUANT
TO RULE 425 UNDER THE SECURITIES ACT OF 1933. IN ADDITION, INTERNATIONAL GAME
TECHNOLOGY DEEMS THIS COMMUNICATION TO BE FILED UNDER RULE 14a-12 OF THE
SECURITIES EXCHANGE ACT OF 1934.
On July 9, 2001, International Game Technology and Anchor Gaming (COMMISSION
FILE NO. 000-23124) jointly issued the following press release:
Contacts:
IGT Media: Ed Rogich
(702) 896-8690
Investors: Bob McIver
(775) 448-0110
Anchor Gaming: T.J. Matthews, CEO
Geoffrey A. Sage, CFO
(702) 896-7568
FOR IMMEDIATE RELEASE
JULY 9, 2001
INTERNATIONAL GAME TECHNOLOGY ANNOUNCES AGREEMENT TO ACQUIRE ANCHOR GAMING
RENO & LAS VEGAS, Nev. - International Game Technology (NYSE: IGT) and Anchor
Gaming (NASDAQ NMS: SLOT) announced today that the Boards of Directors of both
companies have unanimously approved a definitive agreement pursuant to which
Anchor Gaming will merge with a subsidiary of International Game Technology
("IGT"). This tax free, stock for stock transaction is valued at $1.365 billion,
based on IGT's July 6, 2001 closing price of $59.20 and the assumption of
indebtedness of $430 million at March 31, 2001. Based on that price, Anchor
Gaming shareholders would receive one share of IGT Common Stock for each share
of Anchor Gaming. The exchange ratio is subject to a collar as described below.
The transaction will be accounted for on a purchase basis and is expected to be
accretive to IGT's earnings. The combination creates a company with total
combined annual revenues in excess of $2 billion.
As part of the transaction, Thomas J. (T.J.) Matthews will, at closing, join IGT
as its Chief Operating Officer and will continue as President and Chief
Executive Officer of Anchor Gaming. Upon closing of the transaction, two new
directors will be added to the IGT Board of Directors, one of whom will be T.J.
Matthews.
"We are very enthusiastic about this business combination," said G. Thomas
Baker, President and Chief Executive Officer of IGT. "IGT and Anchor Gaming have
been joint venture partners
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since 1996 on the very successful Wheel of Fortune(R) product. Upon closing, IGT
will be able to recognize 100% of the joint revenue and profits previously
shared by the companies. This is a significant strategic benefit. We are also
very excited about the addition of Anchor Gaming's significant executive talent
which will contribute to the further growth of IGT."
"No other company offers the depth of talent that IGT and Anchor Gaming will
have together, from the executive level to design and manufacturing," said T.J.
Matthews, Chairman, President and Chief Executive Officer of Anchor Gaming. "We
are looking forward to the many possibilities that the combination presents."
Under the terms of the collar contained in the definitive agreement, each share
of Anchor Gaming will be converted into one share of IGT subject to a collar
from $50.00 to $75.00 per share. Under the collar mechanism, if IGT's average
stock price exceeds $75.00 per share during the 20-day trading period ending the
third business day prior to Anchor Gaming's shareholder vote on the merger, IGT
will have the right to terminate the merger agreement, subject to Anchor
Gaming's right to elect to accept a lower exchange ratio such that the value of
the stock received by Anchor Gaming shareholders equals $75.00 per share. In
addition, if IGT's share price during the 20-day trading period ending three
business days prior to Anchor Gaming's shareholder vote on the merger is less
than $50.00 per share, Anchor Gaming will have the right to terminate the merger
agreement subject to IGT's right to provide a higher exchange ratio such that
the value of the IGT stock received by Anchor Gaming shareholders equals $50.00
per share.
The merger is subject to the approval of both companies' shareholders and
regulatory approvals, including gaming regulatory approvals. The companies
anticipate that the transaction will be completed in the first calendar quarter
of 2002.
Houlihan Lokey Howard & Zukin provided a fairness opinion to IGT and Dresdner
Kleinwort Wasserstein acted as financial advisor to Anchor Gaming.
International Game Technology is hosting a conference call regarding its
acquisition of Anchor Gaming at 8:00 a.m. Pacific Daylight Time on Monday, July
9, 2001. The access numbers are as follows:
Domestic callers dial 888-282-0413, passcode IGT
International callers dial 630-395-0446, passcode IGT
This conference call will be broadcast live over the Internet, simply log on to
the Internet at the following address to access the call:
What: Conference Call - International Game Technology Announces
Agreement to Acquire Anchor Gaming
When: Monday, July 9, 2001 at 8:00 a.m. (Pacific Daylight Time)
Where: http://www.videonewswire.com/IGT/070901
How: Live over the Internet -- Simply log on to the web address above
Contact: Robert McIver 775-448-0110
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Minimum Requirements to listen to broadcast: The RealPlayer software,
downloadable free from www.real.com/products/player/index.html, and at least a
14.4Kbps connection to the Internet. If you experience problems listening to the
broadcast, send an email to webmaster@vdat.com.
If you are unable to participate during the live webcast, the call will be
archived on the Web site www.igt.com. To access the replay, click on IGT
Investors, FAQ page. The call will also be archived at
http://www.prnewswire.com.
Interested parties not having access to the Internet may listen to a taped
replay of the entire conference call commencing at approximately 10:30 a.m.
(Pacific Daylight Time) on Monday, July 9, 2001. This replay will run through
Tuesday, July 17, 2001. The access numbers are as follows:
Domestic callers dial 800-477-4783 (no reservation number required)
International callers dial 402-998-0883 (no reservation number required)
Statements in this release regarding IGT, which are not historical facts, are
"forward-looking" statements under the Private Securities Litigation Reform Act
of 1995. These matters involve risks and uncertainties, including changes in
demand for the companies products because of a reduction in the growth of
markets or changes in the popularity of its products, a decrease in the
popularity of its wide area progressive systems, the risks of conducting
international operations, the adoption of new unfavorable gaming laws or laws
applicable to gaming machine manufacturers and uncertainties generally
associated with the development and manufacturing of gaming machines and
systems. Historical results achieved are not necessarily indicative of future
prospects of IGT. More information on factors that could affect IGT's business
and its financial results are included in its Annual Report on Form 10-K and
other public filings made with the Securities and Exchange Commission. For more
information on International Game Technology, visit the IGT company web site at
http://www.igt.com.
This press release contains certain forward-looking statements regarding Anchor
Gaming within the meaning of section 21e of the Securities Exchange Act of 1934,
as amended and other applicable securities laws. All statements other than
statements of historical fact are "forward-looking statements" for purposes of
these provisions. Included in these provisions are any projections or estimates
of earnings, revenues, or other financial items. Also, any statements of plans,
strategies, and objectives of management for future operation; any statements
concerning proposed new products, services, or developments; any statements
regarding future economic conditions or performance; statements of belief; and
any statement of assumptions underlying any of the foregoing. Such
forward-looking statements are subject to inherent risks and uncertainties, and
actual results could differ materially from those anticipated by the
forward-looking statements. Although Anchor Gaming believes that the
expectations reflected in any of its forward-looking statements will prove to be
correct, actual results could differ materially from those projected or assumed
in Anchor Gaming's forward-looking statements. These risks and uncertainties
include, but are not limited to: risks regarding the final amount of the
one-time charges; the risk that we may not meet our projected financial results
for the fourth quarter of
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fiscal 2001 or fiscal 2002; risks of proprietary games such as pressures from
competitors, changes in economic conditions, obsolescence, declining popularity
of existing games, failure of new game ideas or concepts to become popular,
duplication by third parties and changes in interest rates as they relating to
the wide area progressive machine operations within our joint venture with IGT;
general changes in economic conditions; our ability to improve results of
operations in our gaming systems segment; our ability to achieve the cost
reductions associated with the restructuring; reduced lottery sales in lottery
jurisdictions where AWI has lottery contracts; our ability to keep or renew
existing lottery contracts; competition in Colorado that could adversely affect
our Colorado casinos; our ability to generate sales of new video lottery central
control systems and video lottery terminals; we are subject to adverse
determination in pending litigation with Acres Gaming relative to our
proprietary games' intellectual property; we are subject to adverse
determination in pending litigation between GTECH Holdings and the Florida
Lottery relative to our Florida lottery contract; we have obligations under
agreements with the Pala Band of Mission Indians that subject us to joint
venture risk, construction risk and sovereign immunity risk; risk that initial
results from the Pala Casino cannot be sustained over the long-term and other
factors described from time to time in Anchor Gaming's reports filed with the
Securities and Exchange Commission, including Anchor's Form 10-K for the year
ended June 30, 2000 and Form 10-Qs for the quarters ended September 30, 2000 and
December 31, 2000. These reports may be obtained free of charge at the website
of the Securities and Exchange Commission at http://www.sec.gov.
THIS MATERIAL IS NOT A SUBSTITUTE FOR THE JOINT PROXY STATEMENT/PROSPECTUS THAT
IGT AND ANCHOR GAMING WILL FILE WITH THE SECURITIES AND EXCHANGE COMMISSION.
INVESTORS ARE URGED TO READ THAT DOCUMENT WHEN IT IS AVAILABLE BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION, INCLUDING DETAILED RISK FACTORS. THE PROXY
STATEMENT/PROSPECTUS AND OTHER IMPORTANT DOCUMENTS FILED BY IGT WILL BE
AVAILABLE FREE OF CHARGE AT THE SEC'S WEBSITE (WWW.SEC.GOV) AND FROM IGT OR
ANCHOR GAMING, AS THE CASE MAY BE. IGT AND ANCHOR GAMING, THEIR DIRECTORS, AND
CERTAIN OF THEIR EXECUTIVE OFFICERS MAY BE CONSIDERED PARTICIPANTS IN THE
SOLICITATION OF PROXIES IN CONNECTION WITH THE MERGER. INFORMATION CONCERNING
IGT'S AND ANCHOR GAMING'S DIRECTORS AND EXECUTIVE OFFICERS CAN BE FOUND IN THE
DOCUMENTS FILED BY IGT AND ANCHOR GAMING WITH THE SEC. CERTAIN DIRECTORS AND
EXECUTIVE OFFICERS OF IGT AND ANCHOR GAMING MAY HAVE DIRECT OR INDIRECT
INTERESTS IN THE MERGER. ADDITIONAL INFORMATION REGARDING THE PARTICIPANTS WILL
BE CONTAINED IN THE JOINT PROXY STATEMENT/PROSPECTUS.