SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 13, 2002
PHARMACIA CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-2516 43-0420020
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
100 Route 206 North, Peapack, New Jersey 07977
(Address of Principal Executive Office) (Zip Code)
908-901-8000
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(Registrant's telephone number, including area code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
ITEM 2. DISPOSITION OF ASSETS.
On August 13, 2002, Pharmacia Corporation (NYSE: PHA)
("Pharmacia") spun-off its remaining interest in its agricultural subsidiary,
Monsanto Company (NYSE: MON) ("Monsanto"), to the holders of Pharmacia common
stock. The spin-off was effected by a special stock dividend, in the aggregate,
of 220,000,000 shares of Monsanto common stock resulting in a distribution ratio
of 0.170593 of a share of Monsanto common stock for each outstanding share of
Pharmacia common stock. The dividend was paid on August 13, 2002 to holders of
record of shares of Pharmacia common stock that were issued and outstanding as
of 5:00 p.m. Eastern time on July 29, 2002, the record date.
Monsanto is a global provider of technology-based solutions
and agricultural products to growers and downstream customers, such as grain
processors, food companies, and consumers, in agricultural markets.
A copy of the press release announcing the completion of the
spin-off is attached to this Form 8-K, incorporated herein by reference and
filed herewith under Item 7 as Exhibit 99.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(b) Pro forma financial information
For the period November 27, 2001 to August 13, 2002, Pharmacia has accounted for
Monsanto as a discontinued operation in accordance with Accounting Principles
Board Opinion No. 30 "Reporting the Results of Operations - Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions". Accordingly, the results of
operations and financial position of Monsanto were reclassified in the
consolidated financial statements as discontinued operations for all periods
presented (each of the three years in the period ended December 31, 2001 and as
of December 31, 2001 and 2000 in Pharmacia's Annual Report on Form 10-K for the
year ended December 31, 2001 and as of and for the three and six month periods
ended June 30, 2002 and 2001 in Pharmacia's Quarterly Report on Form 10-Q for
the quarter ended June 30, 2002). Income from discontinued operations was
reduced for amounts allocable to the minority interest.
As a result of the presentation of Monsanto as a discontinued operation as
described above, there is no pro forma impact or adjustments to Pharmacia's
earnings from continuing operations resulting from the disposition of Monsanto
for each of the three years in the period ended December 31, 2001 or for the six
month periods ended June 30, 2002 and 2001. Accordingly, no unaudited pro forma
consolidated statements of earnings have been presented herein.
In addition, the only pro forma adjustment to the unaudited consolidated balance
sheet of Pharmacia as of June 30, 2002 to reflect the impact of the disposition
of Monsanto would be to eliminate "Net assets of discontinued operations" of
$4,717 million, "ESOP-related accounts" included in shareholders' equity of $26
million, and "Accumulated other comprehensive loss" included in shareholders
equity of $769 million, offset by a reduction to retained earnings of $5,512
million. This pro forma adjustment, determined as of June 30, 2002, is to
eliminate the net assets and certain shareholders' equity accounts of
Monsanto from the consolidated Pharmacia balance sheet as a dividend to
shareholders. The June 30 retained earnings of $5,512 million represents the
book value of the dividend to shareholders as of that date. If the fair value
of the actual distribution on August 13 based on the market value of Monsanto
shares is lower than the Pharmacia book value as of that date, Pharmacia will
record an impairment loss. We anticipate this impairment loss, a noncash
charge to discontinued operations, will be approximately $1,100 million to
$1,300 million.
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(c) Exhibits
Exhibit No. Description
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99 Press Release dated August 14, 2002 (filed herewith).
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
PHARMACIA CORPORATION
Date: August 16, 2002 By: /s/ Robert G. Thompson
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Robert G. Thompson
Senior Vice President and
Corporate Controller
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EXHIBIT INDEX
Exhibit No. Description
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99 Press Release dated August 14, 2002 (filed herewith).
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