EXHIBIT 1
BT ALEX. XXXXX INCORPORATED
---------------------------
January 14, 1998
The Board of Directors of
OHM Corporation
00000 X.X. Xxxxx 000, Xxxx
Xxxxxxx, XX 00000
Dear Sirs:
OHM Corporation ("OHM" or the "Company"), International Technology
Corporation ("Buyer") and IT-Ohio, Inc., a wholly-owned subsidiary of Buyer
("Merger Sub"), propose to enter into an Agreement and Plan of Merger, dated
as of January 15, 1998 (the "Agreement"). Pursuant to the Agreement, within
five business days thereof, Merger Sub will commence a cash tender offer (the
"Offer") to acquire 13,933,000 shares of common stock, par value $0.10 per
share (the "Common Stock"), of OHM at a price of $11.50 per share, net to the
seller in cash. The Agreement also provides that following the Offer, Merger
Sub shall be merged with and into the Company (the "Merger"), and that each
outstanding share of Common Stock, other than Excluded Shares (as defined in
the Merger Agreement), shall be converted into, and become exchangeable for,
the right to receive 1,394 (the "Exchange Ratio") shares of common stock, par
value $0.01 per share, of Buyer ("Buyer Common Stock"); provided, however,
that if the aggregate number of shares of Common Stock accepted for payment
and paid for pursuant to the Offer and purchased from Waste Management, Inc.
pursuant to the Repurchase Agreement (as defined in the Agreement) is less
than 19,168,381 shares of Common Stock, then the Exchange Ratio shall be
adjusted downward, as provided in the Agreement, and if so adjusted, each
outstanding share of Common Stock shall be converted into, and become
exchangeable for, the right to receive a combination of Buyer Common Stock and
cash. Pursuant to the Agreement, concurrently with the acceptance by Merger
Sub of shares of the Common Stock for payment in the Offer, the Company shall
pay a pro rata taxable distribution to holders of record of the Common Stock
as of the close of business on the date prior to the date Merger Sub accepts
Common Stock for payment in the Offer, of all of the shares of common stock,
par value $0.01 per share, of NSC Corporation ("NSC") held by the Company (the
"NSC Distribution"). You have requested our opinion as to whether the
aggregate consideration to be received by the holders of the Common Stock in
the Offer, the Merger and the NSC Distribution is fair, from a financial point
of view, to such holders.
BT Alex. Xxxxx Incorporated ("BT Alex. Xxxxx"), as a customary part of its
investment banking business, is engaged in the valuation of businesses and
their securities in connection with mergers and acquisitions, negotiated
underwritings, private placements and valuations for estate, corporate and
other purposes. We have acted as financial advisor to the Board of Directors
of the Company in connection with the transaction described above and will
receive a fee for our services, a portion of which is contingent upon the
consummation of the transaction described above. We have also served as a
managing underwriter in the follow-on public offering of the Common Stock of
the Company in December, 1993, and have acted as financial advisor to the
Company in connection with other matters. BT Alex. Xxxxx regularly publishes
research reports regarding the environmental services industry and the
businesses and securities of the Company and other publicly owned companies in
the environmental services industry. In the ordinary course of business, BT
Alex. Xxxxx may actively trade the securities of both the Company and the
Buyer for our own account and the account of our customers and, accordingly,
may at any time hold a long or short position in securities of the Company and
the Buyer.
In connection with this opinion, we have reviewed certain publicly available
financial information and other information concerning the Company and Buyer
and certain internal analyses and other information furnished to us by the
Company and Buyer. We have also held discussions with the members of the
senior managements of the Company and Buyer regarding the businesses and
prospects of their respective companies and the joint prospects of a combined
company. In addition, we have (i) reviewed the reported prices and trading
activity for
the common stock of the Company, Buyer and NSC, (ii) compared certain
financial and stock market information for the Company, Buyer and NSC with
similar information for certain companies whose securities are publicly
traded, (iii) reviewed the financial terms of certain recent business
combinations, (iv) performed a discounted cash flow analysis, (v) reviewed the
terms of the Agreement, and (vi) performed such other studies and analyses and
considered such other factors as we deemed appropriate.
We have not independently verified the information described above and for
purposes of this opinion have assumed the accuracy, completeness and fairness
thereof. With respect to the information relating to the prospects of the
Company and Buyer, we have assumed that such information reflects the best
currently available judgments and estimates of the managements of the Company
and Buyer as to the likely future financial performances of their respective
companies. In addition, we have not made nor been provided with an independent
evaluation or appraisal of the assets of the Company and Buyer, nor have we
been furnished with any such evaluations or appraisals. Further, we have not
made an independent evaluation or appraisal of the liabilities (including
environmental liabilities) of the Company or the Buyer. Our opinion is based
on market, economic and other conditions as they exist and can be evaluated as
of the date of this letter.
Our advisory services and the opinion expressed herein were prepared for the
use of the Board of Directors of the Company and do not constitute a
recommendation to the Company's stockholders as to whether to tender their
shares in the Offer or how they should vote at the stockholders' meeting in
connection with the Merger. We hereby consent, however, to the inclusion of
this opinion as an exhibit to the Company's Schedule 14D-9 in connection with
the Offer and to any proxy or registration statement distributed in connection
with the Merger.
Based upon and subject to the foregoing, it is our opinion that, as of the
date of this letter, the aggregate consideration to be received by the holders
of the Common Stock in the Offer, the Merger and the NSC Distribution is fair,
from a financial point of view, to such holders.
Very truly yours,
BT Alex. Xxxxx Incorporated
/s/ BT Alex. Xxxxx Incorporated
