Filed by
Charles River Laboratories International, Inc.
pursuant
to Rule 14a-12
of the
Securities Exchange Act of 1934
Subject
Company: Charles River Laboratories International, Inc.
(Commission
File No.: 001-15943)
PCS Employee
Q&A
April
26, 2010
Q:
Where are WuXi AppTec’s PCS facilities located?
A: WuXi
AppTec has a 314K square foot GLP preclinical safety assessment facility in
Suzhou, China.
Q:
Will the WuXi AppTec PCS business be integrated into Charles
River? Will there be any staff reductions/site closures as a result
of the acquisition?
A: It is
our intent to fully integrate the two companies. We see this as a
great opportunity for the company and our employees over the long term. Our goal
with this transaction is to grow our business.
As the
two companies merge, there will be some limited duplication of functions but the
majority of employees will not be impacted. These duplications will
be identified in the coming months by the integration teams as we solidify our
integration strategy. We will work through the integration process as
quickly as possible.
Q:
How will the expanded business operate? Will there be management
changes?
A: We are
introducing a new business segment, Discovery Services (DS), which will
complement our existing RMS and PCS businesses. The DS business will
consist of discovery and medicinal chemistry, China-based non-GLP efficacy
testing, chemistry-based manufacturing, and discovery and imaging
services. Customers are already outsourcing in these areas which are
fast-growing and profitable.
During
the next few months, integration teams comprised of individuals from both
organizations will focus on making these operational decisions.
Q:
Will Charles River continue to invest in our existing PCS sites?
A:
Yes. We need to continue to invest in our PCS business because it is
critical to the overall growth of the Company. This acquisition will enhance our
PCS business by giving us significant capacity in China, an emerging growth area
for drug research and development. It will complement our
existing businesses in North America and Europe.
Q:
Are there any plans to move the PCS work to China?
A: It is
our long-term vision to support our clients wherever they choose to conduct
their drug research and development. Our clients view China as the
new frontier for drug development. It is our goal to establish a
strong presence for drug development products and services in China, to meet our
clients’ needs.
This
transaction will enable us to support our clients drug development needs in all
three geographic locations. This will enable our clients to work with
us in whatever location they choose; including North America, Europe or China,
or a combination of sites.
It is
important to understand, that there is limited capacity in China, which will
restrict the amount of work that can be done in that area. Currently
North America and Western Europe have more than 8M square feet of preclinical
capacity vs China which has approximately 500K square feet.
Q:
When and how will our clients be notified of the acquisition?
A: Today,
all clients received an email announcing this strategic
acquisition. In addition, senior management began calls to our larger
clients today to ensure they hear directly from us how this transaction will
benefit them.
Q:
How much overlap is there between the client base of Charles River and WuXi
AppTec?
A: We
will not have access to the client lists until the deal is completed in the
fourth quarter 2010.
Forward-Looking
Statements
This
document includes “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements may be
identified by the use of words such as “anticipate,” “believe,” “expect,”
“estimate,” “plan,” “outlook,” and “project” and other similar expressions that
predict or indicate future events or trends or that are not statements of
historical matters. These statements are based on current expectations and
beliefs of Charles River Laboratories International, Inc. (Charles River) and
WuXi AppTec (Cayman) Inc. (WuXi), and involve a number of risks and
uncertainties that could cause actual results to differ materially from those
stated or implied by the forward-looking statements. Those risks and
uncertainties include, but are not limited to: 1) the possibility that the
companies may be unable to obtain stockholder or regulatory approvals required
for the combination; 2) problems may arise in successfully integrating the
businesses of the two companies; 3) the acquisition may involve unexpected
costs; 4) the combined company may be unable to achieve cost synergies; 5) the
businesses may suffer as a result of uncertainty surrounding the acquisition;
and 6) the industry may be subject to future regulatory or legislative actions
and other risks that are described in Securities and Exchange Commission (SEC)
reports filed or furnished by Charles River and WuXi.
Because
forward-looking statements involve risks and uncertainties, actual results and
events may differ materially from results and events currently expected by
Charles River and WuXi. Charles River and WuXi assume no obligation and
expressly disclaim any duty to update information contained in this filing
except as required by law.
Additional
Information
This
document may be deemed to be solicitation material in respect of the proposed
combination of Charles River and WuXi. In connection with the
proposed transaction, Charles
River will file a preliminary proxy statement and a definitive proxy statement
with the SEC. The information contained in the preliminary filing will not be
complete and may be changed. Before making any voting or investment decisions,
investors
and security holders are urged to read the definitive proxy statement when it
becomes available and any other relevant documents filed with the SEC because
they will contain important information. The definitive proxy statement will be
mailed to the shareholders of Charles River seeking their approval of the
proposed transaction. Charles River’s shareholders will also be able to obtain a
copy of the definitive proxy statement free of charge by directing a request to:
Charles River Laboratories, 251 Ballardvale Street, Wilmington, MA 01887,
Attention: General Counsel. In addition, the preliminary proxy statement and
definitive proxy statement will be available free of charge at the SEC’s
website, www.sec.gov
or shareholders may access copies of the documentation filed with the SEC by
Charles River on Charles River’s website at www.criver.com.
Charles
River and its directors and executive officers and other members of management
and employees may be deemed to be participants in the solicitation of proxies in
respect of the proposed transaction. Information regarding Charles River’s
directors and executive officers is available in Charles River’s proxy statement
for its 2010 annual meeting of shareholders, which was filed with the SEC on
March 30, 2010. Information regarding the persons who may, under the rules of
the SEC, be considered participants in the solicitation of Charles River
shareholders in connection with the proposed transaction will be set forth in
the preliminary proxy statement when it is filed with the SEC.
This document does not
constitute an offer of any securities for sale or a solicitation of an offer to
buy any securities. The
Charles River shares to be issued in the proposed transaction have not been and
will not be registered under the Securities Act of 1933, as amended (the
“Securities Act”),
and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements. Charles River intends to
issue such Charles
River
shares pursuant to the exemption from registration set forth in
Section 3(a)(10) of the Securities
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