Filed by: Cognizant Technology Solutions Corporation
Filing under Rule 425 under the Securities Act of 1933
Subject Company: Cognizant Technology Solutions Corporation
Subject Company's Commission File No: 000-24429
Cognizant Technology Solutions Corporation and IMS Health Corporation
jointly issued the following press release on January 8, 2003
[IMS LOGO] [COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION LOGO]
NEWS
FOR IMMEDIATE RELEASE
Contacts:
Michael Gury Brian Maddox/Scot Hoffman
IMS Communications Cognizant Comms. (c/o FD Morgen-Walke)
(203) 319-4730 (212) 850-5600
Darcie Peck Gordon Coburn
IMS Investor Relations Cognizant Chief Financial Officer
(203) 319-4766 (201) 678-2712
IMS HEALTH COMMENCING OFFER TO EXCHANGE
COGNIZANT TECHNOLOGY SOLUTIONS COMMON STOCK
FOR OUTSTANDING IMS SHARES
IMS WILL EXCHANGE 0.309 SHARES OF COGNIZANT STOCK
FOR EACH IMS SHARE TENDERED
FAIRFIELD, CT and TEANECK, NJ, January 8, 2003 - IMS Health (NYSE: RX) and
Cognizant Technology Solutions (Nasdaq: CTSH) today jointly announced that IMS
is commencing its previously announced exchange offer to distribute IMS's
majority interest in Cognizant. Through the transaction, IMS will offer to
exchange 0.309 shares of its Cognizant common stock for each share of IMS common
stock tendered. The exchange ratio represents a premium of approximately 20
percent on the IMS share price, based on today's closing price of $16.64 per IMS
share on the NYSE and $64.55 per Cognizant share on the Nasdaq National Market.
IMS will accept up to 36,540,129 tendered IMS shares in exchange for up
to all of the 11,290,900 Cognizant shares that it now owns. If more than
36,540,129 IMS shares are tendered, IMS will accept those shares on a pro-rata
basis under the terms described in the exchange offer.
In order for the exchange offer to be completed, at least 27,400,000
IMS shares must be tendered. This is equivalent to the exchange of 75 percent of
the Cognizant stock owned by IMS.
IMS believes that the exchange of shares under the offer will generally
be tax-free to exchanging stockholders and to IMS under Federal income tax laws.
The exchange offer is scheduled to expire at 12 midnight EST, on
February 6, 2003. IMS shareholders will be receiving an Offering
Circular-Prospectus that provides complete details of the transaction.
IMS has retained Georgeson Shareholder Communications Inc. as the
information agent for the transaction. To obtain copies of Offering
Circular-Prospectus and related documentation, or if you have questions about
the terms of the exchange offer or how to participate, you may contact the
information agent at (866) 203-1913 (toll-free) in the United States, or (212)
440-9800 from elsewhere.
Goldman, Sachs & Co. and Bear, Stearns & Co. Inc. have been retained by
IMS to serve as financial advisors and joint dealer managers on the transaction.
You may contact the joint dealer managers at one of the telephone numbers listed
on the last page of the Offering Circular-Prospectus with any questions you may
have about the exchange offer.
IMPORTANT INFORMATION ABOUT THE EXCHANGE OFFER
Investors are urged to read the documents that IMS and Cognizant have
filed and will file with the SEC in connection with the exchange offer. These
documents contain important terms and conditions about the exchange offer and
the potential effect of the exchange offer on the companies and their
stockholders. They can be accessed online at the SEC's website
(HTTP://WWW.SEC.GOV), as well as in the "Investors" areas on the IMS and
Cognizant websites.
ABOUT COGNIZANT TECHNOLOGY SOLUTIONS
Cognizant Technology Solutions Corp. is a leading provider of custom
information technology design, development, integration and maintenance
services. Focused on delivering strategic information technology solutions that
address the complex business needs of its clients, Cognizant provides
applications management, development, systems integration and business process
outsourcing services through its onsite/offshore outsourcing model. Cognizant's
more than 6,000 employees are committed to partnerships that sustain long-term,
proven value for customers by delivering high-quality, cost-effective solutions
through its development centers in India and Ireland, and onsite client teams.
Cognizant maintains P-CMM and SEI-CMM Level 5 assessments from an independent
third-party assessor and was recently ranked as the top information technology
company in Forbes' 200 Best Small Companies in America and in BusinessWeek's Hot
Growth Companies.
ABOUT IMS
Operating in more than 100 countries, IMS Health is the world's leading
provider of information solutions to the pharmaceutical and healthcare
industries. With $1.3 billion in 2001 revenue and nearly 50 years of industry
experience, IMS offers leading-edge business intelligence products and services
that are integral to clients' day-to-day operations, including marketing
effectiveness solutions for prescription and over-the-counter pharmaceutical
products; sales optimization solutions to increase pharmaceutical sales force
productivity; and consulting and customized services that turn information into
actionable insights. Additional information is available at
HTTP://WWW.IMSHEALTH.COM.
###
THIS PRESS RELEASE INCLUDES CERTAIN FORWARD LOOKING STATEMENTS. ALTHOUGH IMS
HEALTH AND COGNIZANT BELIEVE THE EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING
STATEMENTS ARE REASONABLE, THEY CAN GIVE NO ASSURANCE THAT SUCH EXPECTATIONS
WILL PROVE CORRECT. THIS INFORMATION MAY INVOLVE RISKS AND UNCERTAINTIES THAT
COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE FORWARD-LOOKING
STATEMENTS. FACTORS WHICH COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES FOR IMS
HEALTH INCLUDE, BUT ARE NOT LIMITED TO (I) THE RISKS ASSOCIATED WITH OPERATING
ON A GLOBAL BASIS, INCLUDING FLUCTUATIONS IN THE VALUE OF FOREIGN CURRENCIES
RELATIVE TO THE U.S. DOLLAR, AND THE ABILITY TO SUCCESSFULLY HEDGE SUCH RISKS,
(II) TO THE EXTENT IMS HEALTH SEEKS GROWTH THROUGH ACQUISITIONS AND JOINT
VENTURES, THE ABILITY TO IDENTIFY, CONSUMMATE AND INTEGRATE ACQUISITIONS AND
VENTURES ON SATISFACTORY TERMS, (III) THE ABILITY TO DEVELOP NEW OR ADVANCED
TECHNOLOGIES AND SYSTEMS FOR ITS BUSINESSES ON TIME AND ON A COST-EFFECTIVE
BASIS, AND THE ABILITY TO IMPLEMENT COST-CONTAINMENT MEASURES, (IV) REGULATORY,
LEGISLATIVE AND ENFORCEMENT INITIATIVES, PARTICULARLY IN THE AREAS OF MEDICAL
PRIVACY AND TAX, (V) TO THE EXTENT UNFORESEEN CASH NEEDS ARISE, THE ABILITY TO
OBTAIN FINANCING ON FAVORABLE TERMS, (VI) DETERIORATION IN ECONOMIC CONDITIONS,
PARTICULARLY IN THE PHARMACEUTICAL, HEALTHCARE OR OTHER INDUSTRIES IN WHICH IMS
HEALTH'S CUSTOMERS OPERATE, AND (VII) UNCERTAINTIES REGARDING THE SATISFACTION
OR WAIVER OF THE CONDITIONS TO THE EXCHANGE OFFER, AND THE EFFECTS ON THE
EXCHANGE OFFER (AS WELL AS THE EFFECTS ON THE TWO COMPANIES AND ON TENDERING
STOCKHOLDERS) OF MARKET CONDITIONS, ECONOMIC CONDITIONS, TAX TREATMENT,
REGULATORY AND LEGAL REQUIREMENTS AND THE RESULTS OF NEGOTIATIONS BETWEEN
COGNIZANT AND IMS HEALTH.
POTENTIAL RISKS AND UNCERTAINTIES THAT COULD CAUSE OR CONTRIBUTE TO DIFFERENCES
FOR COGNIZANT INCLUDE, BUT ARE NOT LIMITED TO: (I) THE SIGNIFICANT FLUCTUATIONS
OF COGNIZANT'S QUARTERLY OPERATING RESULTS CAUSED BY A VARIETY OF FACTORS, MANY
OF WHICH ARE NOT WITHIN COGNIZANT'S CONTROL, INCLUDING (A) THE NUMBER, TIMING,
SCOPE AND CONTRACTUAL TERMS OF APPLICATION DESIGN, DEVELOPMENT AND MAINTENANCE
PROJECTS, (B) DELAYS IN THE PERFORMANCE OF PROJECTS, (C) THE ACCURACY OF
ESTIMATES OF COSTS, RESOURCES AND TIME TO COMPLETE PROJECTS, (D) SEASONAL
PATTERNS OF COGNIZANT'S SERVICES REQUIRED BY CUSTOMERS, (E) LEVELS OF MARKET
ACCEPTANCE FOR COGNIZANT'S SERVICES, (F) POTENTIAL ADVERSE IMPACTS OF NEW TAX
LEGISLATION, AND (G) THE HIRING OF ADDITIONAL STAFF; (II) CHANGES IN COGNIZANT'S
BILLING AND EMPLOYEE UTILIZATION RATES; (III) COGNIZANT'S ABILITY TO MANAGE ITS
GROWTH EFFECTIVELY, WHICH WILL REQUIRE COGNIZANT (A) TO INCREASE THE NUMBER OF
ITS PERSONNEL, PARTICULARLY SKILLED TECHNICAL, MARKETING AND MANAGEMENT
PERSONNEL, (B) TO FIND SUITABLE ACQUISITION CANDIDATES TO SUPPORT GEOGRAPHIC
EXPANSION, AND (C) TO CONTINUE TO DEVELOP AND IMPROVE ITS OPERATIONAL,
FINANCIAL, COMMUNICATIONS AND OTHER INTERNAL SYSTEMS, IN THE UNITED STATES,
INDIA AND EUROPE; (IV) COGNIZANT'S LIMITED OPERATING HISTORY WITH UNAFFILIATED
CUSTOMERS; (V) COGNIZANT'S RELIANCE ON KEY CUSTOMERS AND LARGE PROJECTS; (VI)
THE HIGHLY COMPETITIVE NATURE OF THE MARKETS FOR COGNIZANT'S SERVICES; (VII)
COGNIZANT'S ABILITY TO SUCCESSFULLY ADDRESS THE CONTINUING CHANGES IN
INFORMATION TECHNOLOGY, EVOLVING INDUSTRY STANDARDS AND CHANGING CUSTOMER
OBJECTIVES AND PREFERENCES; (VIII) COGNIZANT'S RELIANCE ON THE CONTINUED
SERVICES OF ITS KEY EXECUTIVE OFFICERS AND LEADING TECHNICAL PERSONNEL;
(IX) COGNIZANT'S ABILITY TO ATTRACT AND RETAIN A SUFFICIENT NUMBER OF HIGHLY
SKILLED EMPLOYEES IN THE FUTURE; (X) COGNIZANT'S ABILITY TO PROTECT ITS
INTELLECTUAL PROPERTY RIGHTS; (XI) THE CONCENTRATION OF COGNIZANT'S OPERATIONS
IN INDIA AND THE RELATED GEO-POLITICAL RISKS OF LOCAL AND CROSS-BORDER
CONFLICTS; (XII) TERRORIST ACTIVITY, THE THREAT OF TERRORIST ACTIVITY, AND
RESPONSES TO AND RESULTS OF TERRORIST ACTIVITY AND THREATS, INCLUDING, BUT NOT
LIMITED TO, EFFECTS, DOMESTICALLY AND/OR INTERNATIONALLY, ON COGNIZANT, ITS
PERSONNEL AND FACILITIES, ITS CUSTOMERS AND SUPPLIERS, FINANCIAL MARKETS AND
GENERAL ECONOMIC CONDITIONS; (XIII) THE EFFECTS, DOMESTICALLY AND/OR
INTERNATIONALLY, ON COGNIZANT, ITS PERSONNEL AND FACILITIES, ITS CUSTOMERS AND
SUPPLIERS, FINANCIAL MARKETS AND GENERAL ECONOMIC CONDITIONS ARISING FROM
HOSTILITIES INVOLVING THE UNITED STATES IN IRAQ OR ELSEWHERE; (XIV) GENERAL
ECONOMIC CONDITIONS; (XV) UNCERTAINTIES AND RISKS DESCRIBED IN COGNIZANT'S
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE EXCHANGE
OFFER REGISTRATION STATEMENT, AND (XVI) UNCERTAINTIES REGARDING THE
SATISFACTION OR WAIVER OF THE CONDITIONS TO THE EXCHANGE OFFER, AND THE EFFECTS
ON THE EXCHANGE OFFER (AS WELL AS THE EFFECTS ON THE TWO COMPANIES AND ON
TENDERING STOCKHOLDERS) OF MARKET CONDITIONS, ECONOMIC CONDITIONS, TAX
TREATMENT, REGULATORY AND LEGAL REQUIREMENTS AND THE RESULTS OF NEGOTIATIONS
BETWEEN COGNIZANT AND IMS HEALTH.
SUCH FORWARD-LOOKING STATEMENTS INCLUDE RISKS AND UNCERTAINTIES; CONSEQUENTLY,
ACTUAL TRANSACTIONS AND RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED OR
IMPLIED THEREBY. ADDITIONAL INFORMATION ON FACTORS THAT MAY AFFECT THE BUSINESS
AND FINANCIAL RESULTS OF THE COMPANIES CAN BE FOUND IN FILINGS OF THE COMPANIES
MADE FROM TIME TO TIME WITH THE SECURITIES AND EXCHANGE COMMISSION.