Filed by UnitedHealth Group Incorporated
Pursuant to Rule 425 under the Securities Act of 1933 and
Deemed Filed Pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Companies: UnitedHealth Group Incorporated
Mid Atlantic Medical Services, Inc.
Commission File No. 1-10864
Commission File No. 1-13340
The Agreement and Plan of Merger relating to UnitedHealth Group's
acquisition of MAMSI is on file with the Securities and Exchange Commission as
an exhibit to UnitedHealth Group's Current Report on Form 8-K dated October 27,
2003, and is incorporated by reference in this filing.
UnitedHealth Group and its directors and executive officers may be
deemed to be participants in the solicitation of proxies or consents from the
holders of MAMSI common stock in connection with the proposed transactions.
Information about the directors and executive officers of UnitedHealth Group is
set forth in the proxy statement for UnitedHealth Group's 2003 Annual Meeting of
Stockholders, which was filed with the SEC on April 9, 2003. Investors may
obtain additional information regarding the interests of such participants by
reading the prospectus and proxy/consent solicitation statement if and when it
becomes available.
N E W S R E L E A S E
UnitedHealth Group
Contact: John Penshorn
Director of Capital Markets
Communications & Strategy
952-936-7214
Mark Lindsay
Director of Public
Communications & Strategy
952-992-4297
(For Immediate Release)
UNITEDHEALTH GROUP SIGNS DEFINITIVE AGREEMENT TO ACQUIRE
MID ATLANTIC MEDICAL SERVICES, INC.
o STRENGTHENS MARKET POSITION IN IMPORTANT AND GROWING REGION
o FURTHER EXPANDS AND ENHANCES CUSTOMER PRODUCTS AND SERVICES
o TRANSACTION ADDITIVE TO 2004 EARNINGS PER SHARE
MINNEAPOLIS, MINNESOTA (October 27, 2003) - UnitedHealth Group (NYSE: UNH) and
Mid Atlantic Medical Services (NYSE: MME) announced today that they have signed
a definitive agreement under which UnitedHealthcare, a division of UnitedHealth
Group, will merge with Mid Atlantic Medical Services, Inc. (MAMSI). MAMSI owns
and operates health maintenance organizations and provides related health and
administrative services for approximately 2 million people in Maryland,
Washington D.C., Virginia, Delaware, West Virginia, northern North Carolina and
southeastern Pennsylvania.
Completion of the acquisition, subject to regulatory approvals and approval by
MAMSI shareholders, is expected in the first quarter of 2004. Under the terms of
the agreement, MAMSI shareholders will receive UnitedHealth Group stock at a
fixed exchange ratio of 0.82 shares for each MAMSI share, plus $18.00 per share
in cash. The total consideration for the transaction is a combination of
approximately 38.6 million net shares and $860 million in cash, which will
ultimately net to just over a $600 million cash outlay after considering option
and residual share proceeds. This mix of equity and cash will maintain the
current balanced capital structure of UnitedHealth Group.
UNITEDHEALTH GROUP AND MID ATLANTIC MEDICAL SERVICES - CONTINUED
UnitedHealth Group Chairman and CEO William W. McGuire, MD, commented that the
merger strengthens the offerings and capabilities available to customers of both
enterprises. "This combination will broadly improve access to affordable health
services for employers and consumers in the mid Atlantic region of the U.S. The
relationships MAMSI has with institutions and providers of care will benefit the
current and future customers of Uniprise and UnitedHealthcare, while the
offerings and capabilities of our Specialized Care Services, Ovations, and
Ingenix businesses will become available to the people currently served by
MAMSI."
McGuire also noted that the combined enterprise will have a leading position in
the mid-Atlantic region, which is among the fastest growing population areas in
the U.S. and is home to approximately 30 Fortune 500 employers. Together,
UnitedHealth Group and MAMSI provide health benefits or related network services
to more than 3.5 million people in the region.
MAMSI Chairman and CEO Mark D. Groban, MD, said "This combination will bring
together two organizations with similar belief systems - both have invested in
strong service models, support the use of evidence-based medicine and work to
build collaborative relationships with physicians, and are committed to tight
operational discipline. The fit is excellent and I am pleased to bring the
combination of both MAMSI and UnitedHealth Group assets and resources to our
stakeholders as we work to improve the health care system, its access, and its
affordability."
Robert Sheehy, UnitedHealthcare CEO, stated "MAMSI's assets, brand, and
reputation will significantly expand the capacities of our mid-Atlantic
franchise. We will retain the MAMSI identity and the combined business will
continue under the leadership of Dr. Groban and his management team. We have
immense respect for the MAMSI management team and employees, the company they
have built, and the quality of services they provide. This will be a very
positive advance for the many customers that we have separately served."
UnitedHealth Group anticipates the acquisition will be immediately accretive to
earnings per share upon closing.
UNITEDHEALTH GROUP AND MID ATLANTIC MEDICAL SERVICES - CONTINUED
CONFERENCE CALL
---------------
Dr. McGuire, Robert Sheehy, Dr. Groban, and members of senior management from
both companies will further discuss the strategic and financial aspects of this
combination in a public conference call this morning. Details are as follows:
Time: 8:45 a.m. Eastern Standard Time
Domestic Dial-in: 800-515-2563
International Dial-in: 706-679-5262
Pass Code: None
The conference call meeting will be broadcast live on UnitedHealth Group's
website at www.unitedhealthgroup.com. A replay will be available beginning at
12:00 pm on October 27 for 48 hours. The replay can be accessed by dialing
800-642-1687 (domestic) or 706-645-9291 (international) and using pass code
3675746.
ABOUT THE COMPANIES
-------------------
UnitedHealth Group (www.unitedhealthgroup.com) is a diversified enterprise that
provides a full spectrum of resources and services to help people achieve
improved health and well-being through all stages of life. UnitedHealth Group is
organized into six major businesses: UnitedHealthcare, Uniprise, AmeriChoice,
Ovations, Specialized Care Services and Ingenix.
Mid Atlantic Medical Services (MAMSI) is a regional holding company whose
subsidiaries include: three health maintenance organizations, MD-Individual
Practice Association, Inc. (M.D. IPA), Optimum Choice, Inc. (OCI) and Optimum
Choice of the Carolinas, Inc. (OCCI); a preferred provider organization,
Alliance PPO, LLC; a life and health insurance company, MAMSI Life and Health
Insurance Company (MLH); a coordination of benefits company, Alliance Recovery
Services, LLC (ARS); and home care companies such as HomeCall, Inc., FirstCall,
Inc., and HomeCall Pharmaceutical Services, Inc. For more information about the
Company, visit its website, www.mamsi.com.
UNITEDHEALTH GROUP AND MID ATLANTIC MEDICAL SERVICES - CONTINUED
IMPORTANT MERGER INFORMATION
----------------------------
In connection with the proposed transactions, UnitedHealth Group and MAMSI
intend to file relevant materials with the Securities and Exchange Commission
("SEC"), including one or more registration statement(s) that contain a
prospectus and proxy/consent solicitation statement. Because those documents
will contain important information, holders of MAMSI common stock are urged to
read them, if and when they become available. When filed with the SEC, they will
be available for free (along with any other documents and reports filed by
UnitedHealth Group and MAMSI with the SEC) at the SEC's website, www.sec.gov,
and MAMSI stockholders will receive information at an appropriate time on how to
obtain transaction-related documents for free from MAMSI. Such documents are not
currently available.
MAMSI and its directors and executive officers may be deemed to be participants
in the solicitation of proxies or consents from the holders of MAMSI common
stock in connection with the proposed transactions. Information about the
directors and executive officers of MAMSI and their ownership of MAMSI common
stock is set forth in the proxy statement for MAMSI's 2003 Annual Meeting of
Stockholders, which was filed with the SEC on March 24, 2003. Investors may
obtain additional information regarding the interests of such participants by
reading the prospectus and proxy/consent solicitation statement if and when it
becomes available.
This communication shall not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act of 1933,
as amended.
FORWARD-LOOKING STATEMENTS
--------------------------
This news release may contain statements, estimates or projections that
constitute "forward-looking" statements as defined under U.S. federal securities
laws. Generally the words "believe," "expect," "intend," "estimate,"
"anticipate," "project," "will" and similar expressions identify forward-looking
statements, which generally are not historical in nature. By their nature,
forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ materially from our historical experience and our
present expectations or projections. A list and description of some of the risks
and uncertainties can be found in our reports filed with the Securities and
Exchange Commission from time to time, including our annual reports on Form
10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. You should
not place undue reliance on forward-looking statements, which speak only as
UNITEDHEALTH GROUP AND MID ATLANTIC MEDICAL SERVICES - CONTINUED
of the date they are made. Except to the extent otherwise required by federal
securities laws, we do not undertake to publicly update or revise any
forward-looking statements.
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