WeightWatchers 2002 Annual Report Download - page 21

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Acquisition of Weighco. On January 16, 2001, we acquired the franchised territories and certain
business assets of Weighco for an aggregate purchase price of $83.8 million. The acquisition was
financed through additional borrowings of $60.0 million and cash from operations. The acquisition has
been accounted for as a purchase. Accordingly, Weighco’s earnings have been included in our
consolidated operating results since the date of acquisition.
Change in Fiscal Year. Effective April 30, 2000, we changed our fiscal year end from the last
Saturday in April to the Saturday closest to December 31 and eliminated a one month reporting lag for
certain foreign subsidiaries. The results of operations for these foreign subsidiaries have been adjusted
for the eight months ended December 30, 2000. The effect on our net income for these subsidiaries for
the period March 31, 2000 through April 29, 2000 was $1.1 million and was adjusted to the opening
accumulated deficit at April 30, 2000.
Recapitalization. On September 29, 1999, as part of our acquisition by Artal Luxembourg, we
entered into a recapitalization and stock purchase agreement, or the Transaction, with our former
parent, Heinz. In connection with this transaction, we effectuated a stock split of 58.7 shares for each
share outstanding. We then redeemed 164.4 million shares of common stock from Heinz for
$349.5 million. The $349.5 million consisted of $324.5 million of cash and $25.0 million of our
redeemable Series A Preferred Stock. After redemption, Artal Luxembourg purchased 94% of our
remaining common stock from Heinz for $223.7 million. The recapitalization and stock purchase was
financed through borrowings under credit facilities amounting to approximately $237.0 million and by
issuing senior subordinated notes amounting to $255.0 million. In connection with the Transaction, we
incurred approximately $8.3 million in transaction costs, which were included in the results of
operations for the fiscal year ended April 29, 2000.
Management Initiatives. In fiscal 1997, we made the strategic decision to discontinue the sale of
pre-packaged frozen meals in our NACO meetings (which were added in 1990 by our former owner,
Heinz) and to introduce to our NACO operations some of the best practices developed by our
European managers, including our new POINTS-based program.
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