announced today that United States Surgical Corporation (USSC) Value Support Rights (VSRs) have, by their terms, been cancelled. Prior to its acquisition by Tyco, in 1996 USSC settled a class action lawsuit and issued to its shareholders VSRs that would guarantee, among other things, a minimum $70 value for USSC for forty-five consecutive trading days within two years from the date of issue. Following the merger of USSC and Tyco, this share value guarantee transferred to Tyco at $92.03, derived by dividing the $70 value by 0.7606, the exchange ratio of USSC shares for Tyco shares. As a
result of Tyco's stock performance, Tyco common shares had closed above the guaranteed minimum value of $92.03 for forty-five consecutive trading days, thereby satisfying the requirements of the VSRs without any payment by USSC
or Tyco. Accordingly, the VSRs are cancelled and Tyco has no further liability thereunder.
"Given Tyco's consistently strong performance in all sectors of its business, it is not surprising that our share value exceeded the threshold,"
said L. Dennis Kozlowski, Tyco's Chairman and Chief Executive Officer. "The hallmark of Tyco's strategy is creating shareholder value through higher earnings per share and strong cash flow. Over the past several years, we have done this, in part, through a meaningful shift in our revenue and earnings to recurring and more stable sources; through healthy organic business growth; through acquisitions that are immediately accretive to earnings, fit within our existing segments and have attractive long-term
financial return; through strong cash flow generation; and, through a relentless focus on productivity improvements throughout our businesses. These actions have resulted in strong gains in Tyco's earnings per share
accompanied by a rising share price," he added.
Tyco International Ltd., a diversified manufacturing and service company, is the world's largest manufacturer, installer, and provider of fire protection systems and electronic security services, the largest manufacturer and
servicer of electrical and electronic components and underwater telecommunications systems, the largest manufacturer of flow control valves,
and has strong leadership positions in disposable medical products, plastics, and adhesives. The Company operates in more than 80 countries
around the world and has expected fiscal 1999 revenues in excess of $22
billion.
FORWARD LOOKING INFORMATION
Comments in this earnings release concerning fiscal 1999 revenues
and the stability of earnings and revenue sources are forward-looking
statements, which are based on management's good faith expectations and
belief concerning future developments. Actual results may materially differ
from these expectations as a result of many factors, relevant examples of
which are set forth in the "Management Discussion and Analysis" section of
the Company's 1998 Annual Report to Shareholders and the Company's 1998
Annual Report on Form 10-K.