Filed by Cardinal Health, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: Syncor International Inc.
Commission File No. 000-08640
[CARDINAL HEALTH LOGO]
CENTRAL PHARMACY SERVICES QUESTIONS AND ANSWERS
ABOUT SYNCOR
Syncor International Corporation (www.syncor.com), based near Los Angeles,
California, is a leading provider of high technology health care services
concentrating on nuclear pharmacy services. In the nuclear pharmacy services
business, Syncor compounds and dispenses radiopharmaceuticals for diagnostic and
therapeutic use by nuclear medicine departments in more than 7,000 hospitals and
outpatient clinics in major U.S. metropolitan areas and select international
locations. Syncor distributes these time-critical pharmaceuticals through an
integrated network of 149 domestic and international nuclear pharmacies. Syncor
has about 4,300 employees.
THE MECHANICS OF THE DEAL
Under the plan announced today, Syncor has agreed to be acquired by Cardinal
Health pursuant to a stock-for-stock merger. A "stock-for-stock merger" means
that, if the merger is approved by Syncor shareholders, Cardinal Health is going
to pay for the acquisition by exchanging shares of its common stock with the
shares of common stock currently held by Syncor shareholders, and Syncor will
become a wholly owned subsidiary of Cardinal. According to the terms of our
agreement, each Syncor shareholder will receive 0.52 Cardinal Health shares for
every share of Syncor stock they own. The transaction must be approved by U.S.
regulatory agencies and Syncor shareholders. We anticipate completing the deal
by the end of the calendar year.
WHAT HAPPENS IN THE MEANTIME?
In the meantime, it's business as usual. There's no reason for us to do anything
differently when it comes to sales, operations or any other company functions.
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And it's important that we don't coordinate our behavior or share proprietary
information about customers, prices or marketing with Syncor until the
acquisition is formally completed. However, we're likely to start considering
transition-related issues immediately, with implementation after the transaction
closes.
DOES THIS MEAN THAT CARDINAL HEALTH WILL MERGE OPERATIONS?
Our intent is to take the best elements of both companies to create the best
nuclear pharmacy services business in the industry. It's important to note that
Fred Burke, president of Central Pharmacy Services, and Rod Boone, president of
Syncor Pharmacy Services, will be equal partners in a collaborative effort to
identify those "best practice" elements.
HOW FAST IS THE INTEGRATION TEAM LIKELY TO MAKE DECISIONS?
While we can start to do some research and prepare for further conversations, we
really can't do much before the transaction has received regulatory approval and
is concluded. After that, we anticipate taking a thoughtful, but expeditious,
approach - and making any changes only as it makes sense to do for the business.
It's difficult to know what changes will be required or how fast they would
happen. What we do know is that this will surely be a growing business with all
the challenges and opportunities you would expect for a growing business. The
faster we can capitalize on our opportunities, the better.
HOW WILL THE DIFFERENCES IN BUSINESS PRACTICES BE ADDRESSED?
Both organizations bring cultural strengths to the table. The integration team
will look to preserve the best elements of our respective cultures moving
forward.
WHAT ADVANTAGES DOES THE ACQUISITION BRING TO CARDINAL HEALTH?
In many ways, partnering with Syncor is a natural extension for Cardinal Health.
Many of their customers are already Cardinal Health customers for a range of
other services like pharmaceutical distribution, med-surg distribution, pharmacy
automation and outsourcing. Syncor's broad network of pharmacies represents a
specialty distribution channel Cardinal Health can use to bring complex
pharmaceuticals to market. At the same time, the work Cardinal Health does with
the pharmaceutical and biotech companies who make nuclear medicines will
increase Syncor's access and visibility to critical product introductions.
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WILL ANY CPSI EMPLOYEES BE AFFECTED?
Again, nothing changes for the short-term. Once the acquisition is final, the
integration team will determine a plan that makes sense for customers and
employees. We will keep you posted on developments in this regard as the process
proceeds.
WHEN CAN WE START WORKING WITH SYNCOR LABS?
It's important that we don't discuss specific customer information, pricing, or
marketing efforts with Syncor or otherwise coordinate our strategies until the
acquisition receives regulatory clearance and is concluded. Please do not
approach Syncor until we let you know that the transaction is final. Similarly,
if you are approached for any information, please check with Fred Burke before
you respond to any inquiries.
WILL WE USE SYNCOR SALESPEOPLE FOR CUSTOMER RELATIONSHIPS?
Again, it is premature to speculate about any changes in the way we do business.
This will be among the many, many things the integration team will discuss.
WILL WE CONSOLIDATE COMPENSATION OR INCENTIVE PLANS? WILL ELIGIBLE CPSI
EMPLOYEES CONTINUE TO RECEIVE CARDINAL HEALTH STOCK OPTIONS?
There will be no changes to current compensation, incentive or option structures
for either company immediately. CPSI is already on the Cardinal Health platform,
and over time, Cardinal Health will likely merge the Syncor employees onto the
same platform, including health and welfare benefits and options.
WHAT KIND OF CAREER OPPORTUNITIES MIGHT THE ACQUISITION LEAD TO FOR CPSI
EMPLOYEES?
We believe that the acquisition will provide many opportunities. We are a
performance-oriented growth company--opportunity always exists for talented
individuals.
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OUR COMMITMENT TO COMMUNICATE
We're sure you have many more questions about what this acquisition will mean
for you, and we are eager to share as much information as we can. But, there are
a lot of things that will take time to figure out - and still other things that
we won't be able to think about until the transaction is final. However, you
have our commitment to keep you as informed as possible.
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Cardinal Health, Inc. ("Cardinal") intends to file a registration statement on
Form S-4 in connection with the transaction, and Syncor International
Corporation ("Syncor") intends to mail a proxy statement/prospectus to its
stockholders in connection with the transaction. INVESTORS AND SECURITY HOLDERS
OF SYNCOR ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES
AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT CARDINAL, SYNCOR
AND THE TRANSACTION. Investors and security holders may obtain a free copy of
the proxy statement/prospectus (when it is available) at the SEC's web sit at
www.sec.gov. A free copy of the proxy statement/prospectus may also be obtained
from Cardinal or Syncor. Syncor and its executive officers and directors may be
deemed to be participants in the solicitation of proxies from the stockholders
of Syncor in favor of the transaction. Information regarding the interests of
Syncor's officers and directors in the transaction will be included in the joint
proxy statement/prospectus. In addition to the registration statement on Form
S-4 to be filed by Cardinal in connection with the transaction, and the proxy
statement/prospectus to be mailed to the stockholders of Syncor in connection
with the transaction, each of Cardinal and Syncor file annual, quarterly and
special reports, proxy and information statements, and other information with
the SEC. Investors may read and copy any of these reports, statements and other
information at the SEC's public reference room located at 450 5th Street, N.W.,
Washington, D.C., 20549. Investors should call the SEC at 1-800-SEC-0330 for
further information. The reports, statements and other information filed by
Cardinal and Syncor with the SEC are also available for free at the SEC's web
site at www.sec.gov. A free copy of these reports, statements and other
information may also be obtained from Cardinal or Syncor. INVESTORS SHOULD READ
THE PROXY STATEMENT/PROSPECTUS CAREFULLY WHEN IT BECOMES AVAILABLE BEFORE MAKING
ANY VOTING OR INVESTMENT DECISION.
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