SUPPLEMENT TO PROXY STATEMENT
As previously disclosed, one purported class action complaint challenging the merger has been filed in the District of Delaware, captioned
Scott v. DST Systems, Inc., et al.
, Case No. 1:18-cv-00286-GMS (D. Del.) (the “Scott Action”), one complaint, filed by the plaintiff stockholder on an individual basis, challenging the merger has been filed in the District of Delaware, captioned
Williams v. DST Sys., Inc., et al
., Case No. 1:18-cv-00322-GMS (D. Del.) (the “Williams Action”) and one purported class action complaint challenging the merger has been filed in the District of Missouri, captioned
Pratt v. DST Sys., Inc., et al
., Case No. 4:2018-cv-00133-DGK (W.D. Mo.) (the “Pratt Action” and collectively with the Scott Action and Williams Action, the “Actions”). The Actions allege certain violations of the Securities Exchange Act of 1934, as amended, and seek, among other things, damages, attorneys’ fees and injunctive relief to prevent the merger from closing.
While the Company believes that the Actions lack merit and that the disclosures set forth in the Definitive Proxy Statement comply fully with applicable law, in order to moot plaintiffs’ unmeritorious disclosure claims, avoid nuisance and possible expenses and provide additional information to our stockholders, the Company has determined to voluntarily supplement the Definitive Proxy Statement as described in these Definitive Additional Materials.
Nothing in these Definitive Additional Materials shall be deemed to be an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth herein. To the contrary, the Company specifically denies all allegations that any disclosure was or is required.
The following Supplement to the Definitive Proxy Statement should be read in conjunction with the Definitive Proxy Statement filed by the Company with the SEC on February 27, 2018, which should be read in its entirety. To the extent that information in this supplement differs from or updates information in the Definitive Proxy Statement, the information in this supplement shall supersede the information in the Definitive Proxy Statement. All page references to the pages of the Definitive Proxy Statement, and all terms used below, unless otherwise defined shall have the meanings set forth in the Definitive Proxy Statement. Supplemental disclosure is indicated by underline or strikethroughs as appropriate.
Opinion of DST’s Financial Advisor
The disclosure in the section captioned “Proposal 1: Adoption of the Merger Agreement—The Merger—Opinion of DST’s Financial Advisor—Summary of Material DST Financial Analyses” of the Definitive Proxy Statement is amended and supplemented as follows:
The sub-section captioned “Selected Publicly Traded Companies Analysis” which overlaps pages 45-46, is amended and restated as follows:
BofA Merrill Lynch reviewed publicly available financial and stock market information for DST and the following publicly traded companies: (i) three companies engaged in the financial services industry with calendar year 2018 estimated revenue growth of 3.5% or lower, which we refer to as the Primary Financial Services Companies, (ii) four companies engaged in the financial services industry with calendar year 2018 estimated revenue growth of greater than 3.5%, which we refer to as the Other Financial Services Companies, and (iii) six companies engaged in the healthcare industry, which we refer to as the Healthcare Services Companies, each of which BofA Merrill Lynch considered
to have operations or to participate in
,
based on, among other things, their respective
end markets
so as
, operations, growth profiles and profit margins,
to be relevant to BofA Merrill Lynch’s analysis.
For each of the selected publicly traded companies, BofA Merrill Lynch calculated per share equity values, based on closing stock prices on January 9, 2018, as a multiple of calendar year 2018 estimated earnings per share, commonly referred to as EPS, adjusted to exclude amortization of intangibles and one-time non-recurring items, which we refer to as adjusted EPS.