Filed by Millennium Chemicals Inc.
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 Company: Millennium Chemicals Inc.
Form S-4 Registration Statement File No.: 333-114877
Date: July 29, 2004
This filing contains the text of a press release issued by Millennium on July
29, 2004. These materials are being filed pursuant to Rule 425 under the
Securities Act of 1933.
MILLENNIUM
CHEMICALS
NEWS RELEASE
Contact: Thomas Van Valkenburgh
Manager of Investor Relations
(410) 229-8113
FOR IMMEDIATE RELEASE
MILLENNIUM CHEMICALS TO RESTATE FINANCIAL STATEMENTS
----------------------------------------------------
Hunt Valley, Maryland, July 29, 2004 -- Millennium Chemicals (NYSE-MCH)
("Millennium" or the "Company") announced today that it will restate its
financial statements to correct accounting for deferred taxes relating to its
investment in Equistar Chemicals, LP, Millennium's joint venture with Lyondell
Chemical Company (NYSE-LYO). The restatement is not expected to affect
Millennium's consolidated statements of operations for any years after 1999 but
is expected to increase shareholders' equity at December 31, 2000 and 2001 and
reduce shareholders' deficit at December 31, 2002 and 2003 by approximately $15
million (and correspondingly reduce Millennium's liability for deferred income
taxes). The restatement will not affect the cash flow or operating income of
Millennium in any year.
The restatement of approximately $15 million will correct errors made during the
period 1997 through 1999 in determining Millennium's tax basis in Equistar,
which is used to compute deferred income taxes. The November 2003 restatement of
Millennium's financial statements overstated the Company's liability for
deferred income taxes relating to Equistar.
Millennium intends to file amendments to its Annual Report on Form 10-K for 2003
and its Quarterly Report on Form 10-Q for the first quarter of 2004 as soon as
practicable to reflect the restatement.
Millennium Chemicals (website: www.millenniumchem.com) is a major international
chemicals company, with leading market positions in a broad range of commodity,
industrial, performance and specialty chemicals.
Millennium Chemicals is:
o The second-largest producer of TiO2 in the world, the largest merchant
seller of titanium tetrachloride and a major producer of zirconia, silica
gel and cadmium-based pigments;
o The second-largest producer of acetic acid and vinyl acetate monomer in
North America;
o A leading producer of terpene-based fragrance and flavor chemicals; and,
o Through its 29.5% interest in Equistar Chemicals, LP, a partner in the
second-largest producer of ethylene and third-largest producer of
polyethylene in North America, and a leading producer of performance
polymers, oxygenated chemicals, aromatics and specialty petrochemicals.
The statements in this press release that are not historical facts are, or may
be deemed to be, "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. Some of these statements can be
identified by the use of forward-looking terminology such as "prospects,"
"outlook," "believes," "estimates," "intends," "may," "will," "should,"
"anticipates," "expects" or "plans," or the negative or other variation of these
or similar words, or by discussion of trends and conditions, strategy or risks
and uncertainties. In addition, from time to time, Millennium or its
representatives have made or may make forward-looking statements in filings that
Millennium makes with the Securities and Exchange Commission, in press releases
or in written or oral statements made by or with the approval of one of its
authorized executive officers. These forward-looking statements are only present
expectations reflecting current assumptions about future events. Actual events
or results may differ materially. Factors that could cause such a difference
include: the approval by Lyondell's and Millennium's shareholders of the
proposed business combination between Lyondell and Millennium and the closing of
such combination within the expected time frame or at all; the cyclicality and
volatility of the chemical industries in which Millennium and Equistar operate,
particularly fluctuations in the demand for ethylene, its derivatives and
acetyls and the sensitivity of these industries to capacity additions; general
economic conditions in the geographic regions where Millennium and Equistar
generate sales, and the impact of government regulation and other external
factors, in particular the events in the Middle East; the ability of Equistar to
distribute cash to its partners and uncertainties arising from Millennium's
minority interest in Equistar, and Millennium's contractual commitments
regarding possible future capital contributions to Equistar; changes in the cost
of energy and raw materials, particularly natural gas and ethylene, and
Millennium's and Equistar's ability to pass on cost increases to their
respective customers; Millennium's substantial indebtedness and its impact on
Millennium's cash flow, business operations and ability to obtain additional
financing -- failure to comply with the covenants and other restrictions in
Millennium's debt instruments would lead to additional restrictions and costs,
or an acceleration of Millennium's indebtedness; limitations on credit extended
to Millennium and demands from creditors and suppliers for additional credit
restrictions or security; the ability of raw material suppliers to fulfill their
commitments; the ability of Millennium and Equistar to achieve their
productivity improvement, cost reduction and working capital targets, and the
occurrence of operating problems at manufacturing facilities of Millennium or
Equistar; risks of doing business outside the United States, including currency
fluctuations; the cost of compliance with the extensive environmental
regulations affecting the chemical industry and exposure to liabilities for
environmental remediation and other environmental matters relating to
Millennium's and Equistar's current and former operations; pricing and other
competitive pressures; and legal proceedings relating to present and former
operations (including proceedings based on alleged exposure to lead-based paints
and lead pigments, asbestos and other materials), ongoing and future tax audits,
pension and retiree medical costs, and other claims. A further description of
these risks, uncertainties and other matters can be found in Exhibit 99.1 to
Millennium's Quarterly Report on Form 10-Q for the quarter ended March 31, 2004,
and Lyondell's Amendment No. 1 to its registration statement on Form S-4 (as
amended, the "Form S-4") containing the preliminary joint proxy
statement/prospectus regarding the proposed business combination, which was
filed with the Securities and Exchange Commission (the "SEC") on June 18, 2004.
Millennium disclaims any obligation to update any forward-looking statement,
whether as a result of new information, future events or otherwise.
The definitive joint proxy statement/prospectus regarding the proposed business
combination will be sent to holders of Lyondell's and Millennium's common stock
when it becomes available. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THAT
DOCUMENT AND ANY OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH THE
SEC, INCLUDING THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS THAT WILL BE PART
OF THE DEFINITIVE REGISTRATION STATEMENT, AS THEY BECOME AVAILABLE, BECAUSE THEY
CONTAIN, OR WILL CONTAIN, IMPORTANT INFORMATION. Investors and security holders
may obtain a free copy of the definitive joint proxy statement/prospectus (when
it becomes available) and other documents filed by Lyondell and Millennium with
the SEC at the SEC's web site at www.sec.gov. The preliminary joint proxy
statement/prospectus and the definitive joint proxy statement/prospectus (when
it becomes available) and the other documents filed by Millennium may also be
obtained free from Millennium by calling Millennium's Investor Relations
department at (410) 229-8113.
The respective executive officers and directors of Lyondell and Millennium and
other persons may be deemed to be participants in the solicitation of proxies in
respect of the proposed transaction. Information regarding Lyondell's executive
officers and directors is available in the proxy statement filed with the SEC by
Lyondell on March 16, 2004 and in the Form S-4, and information regarding
Millennium's directors and its executive officers is available in Millennium's
Annual Report on Form 10-K/A for the year ended December 31, 2003, which was
filed with the SEC on April 27, 2004, and in the Form S-4. Other information
regarding the participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise, will be
contained in the definitive joint proxy statement/prospectus and other relevant
materials filed with the SEC, as they become available.
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