Henley Group Discloses Details of Breakup Plan

In a filing Wednesday with the Securities and Exchange Commission, Henley Group disclosed details of its previously announced plan to separate into two publicly held companies.

The current Henley Group will be renamed Wheelabrator Group and will own all of Henley’s refuse-to-energy assets, including its 60% stock ownership of Wheelabrator Technologies--a leading developer and operator of refuse-to-energy plants.

Shares of existing Henley stock will be considered valid certificates for an equal number of Wheelabrator Group shares, Henley said in a prepared statement.

Shareholders of Wheelabrator Group will also receive shares in a new entity called Henley Group, which will own all remaining Henley assets--including majority stock of Fisher Scientific Group and Henley Manufacturing, two publicly traded Henley spinoffs, as well as a newly acquired 50% interest in Pneumo Abex.

Wheelabrator Group shareholders will receive their new Henley Group stock as a partially taxable stock dividend at the ratio of 22.5 shares for each 100 shares of existing Henley Group stock owned. The distribution is expected to take place before year-end.

Shares for Assets

The new Henley Group will also receive 11.8 million Wheelabrator Group shares in exchange for certain assets, bringing the total Wheelabrator Group shares outstanding to 98 million. Wheelabrator Group, in turn, will receive about 10% of the new Henley Group outstanding stock, which is expected to number 21.6 million shares after the stock dividend.

“Separating Henley into two public companies may result in a higher overall market valuation of our businesses,” Henley Chairman Michael Dingman said in a statement. The top management of the new Henley and Wheelabrator Group will be identical, with Dingman as chairman of both concerns, Henley said.

The new Henley Group also plans to enter into a credit agreement providing up to $750 million to enable it to purchase up to 10 million of its shares, including stock owned in odd lots or blocks fewer than 100 shares.

Wheelabrator Group, which will be based in Hampton, N.H., also may authorize a reverse split of its stock to reduce the number of shares outstanding, Henley said.

Henley Group stock closed up 62.5 cents at $24.625 a share in over-the-counter trading.