SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 3)
Arch Coal, Inc.
(Name of Issuer)
Common Stock
(Title of class of Securities)
039380100
(CUSIP Number)
David L. Hausrath
Vice President and
General Counsel
Ashland Inc.
50 E. RiverCenter Boulevard
P.O. Box 391
Covington, KY 41012-0391
(606) 815-3333
(Name, address and telephone number of person
authorized to receive notices and communications)
October 5, 1999
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule 13D,
and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box ____.
CUSIP No. 039380100 13D Page 2 of 6
1 NAME OF REPORTING PERSONS Ashland Inc.
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
61-0122250
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
N/A (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS 00 (See Item 3)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Kentucky
NUMBER OF 7 SOLE VOTING POWER
SHARES 22,123,273
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH 0
REPORTING
PERSON WITH 9 SOLE DISPOSITIVE POWER
22,123,273
10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
22,123,273 shares of common stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
57.9% of the shares of common stock
14 TYPE OF REPORTING PERSON
CO
Page 3 of 6
Securities and Exchange Commission
Washington, D.C. 20549
Schedule 13D
Item 1. Security and Issuer
- ------ -------------------
Ashland Inc. ("Ashland") currently owns 22,123,273 shares of common
stock ("common stock"), par value $.01 per share, of Arch Coal, Inc. ("Arch
Coal").
Arch Coal is a Delaware corporation with its principal executive offices
located at City Place One, Suite 300, Creve Coeur, Missouri 63141.
Item 2. Identity and Background
- ------ -----------------------
(a), (b) and (c) Ashland is a Kentucky corporation with its principal
executive offices located at 50 E. RiverCenter Blvd., P. O. Box 391,
Covington, Kentucky 41012-0391. Ashland is a diversified company with wholly
owned operations in distribution, specialty chemicals, motor oil and car care
products, and highway construction. Ashland also has a 38-percent equity
interest in Marathon Ashland Petroleum LLC and a 58-percent equity interest in
Arch Coal.
The executive officers and directors of Ashland and their principal
occupations are shown on the attached Schedule I. The business address of
each executive officer is shown on Schedule I. Each director's business
address is Ashland Inc., c/o Office of the Secretary, 50 E. RiverCenter
Boulevard, P. O. Box 391, Covington, KY 41012-0391.
(d-e) During the last five years, neither Ashland nor any of the persons
listed in Schedule I hereto, has been (i) convicted in a criminal proceeding
(excluding traffic violations and similar misdemeanors) or (ii) a party to a
civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, Federal or state securities laws or
finding any violation with respect to such laws.
(f) Each executive officer and director is a U.S. citizen.
Item 3. Source and Amount of Funds or Other Consideration
- ------ -------------------------------------------------
Not applicable.
Page 4 of 6
Item 4. Purpose of Transaction
- ------ ----------------------
On June 22, 1999, Ashland, as a shareholder of Arch Coal, announced that
it had retained the investment banking firm of Goldman Sachs to help
Ashland explore strategic alternatives for its investment in Arch Coal. On
October 5, 1999, Ashland announced that it was making progress on its
study to explore strategic alternatives for its investment in Arch Coal
and that, at this point, a tax-free spin-off to its shareholders would
seem to be its preferred alternative. Ashland also announced that it has
submitted a proposal to Arch Coal and has begun discussions with a
special committee of the Arch Coal Board of Directors regarding such a
spin-off transaction. Such a spin-off would be subject, among other things,
to a negotiated agreement with the special committee of the Arch Coal
Board of Directors, approval by the Arch Coal shareholders, a favorable
ruling from the Internal Revenue Service, and approval by Ashland's
Board of Directors. There can be no assurance that an agreement with the
special committee of the Arch Coal Board of Directors will be reached
or that the necessary approvals of the Arch Coal shareholders and the
Ashland Board of Directors will be obtained or that a favorable ruling
from the Internal Reveue Service will be obtained. Even if an agreement
is reached and such conditions are met, Ashland anticipates that it will
be several months before a spin-off could be consummated.
Any strategic alternatives, including a spin-off, may result in (a) the
acquisition by any person of additional securities of Arch Coal, or the
disposition of securities of Arch Coal; (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving Arch
Coal or any of its subsidiaries; (c) a sale or transfer of a material amount
of assets of Arch Coal or any of its subsidiaries; (d) a change in the present
board of directors or management of Arch Coal, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board; (e) a material change in the present capitalization or
dividend policy of Arch Coal; (f) a material change in Arch Coal's business or
corporate structure; (g) changes in Arch Coal's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of Arch Coal by any person; (h) a class of securities of Arch Coal to
be delisted from a national securities exchange or ceasing to be authorized to
be quoted in an inter-dealer quotation system of a registered national
securities association; (i) the common stock of Arch Coal becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act; or (j) any action similar to the foregoing.
Page 5 of 6
Item 5. Interest in Securities of the Issuer
- ------ ------------------------------------
I. Ashland
-------
(a) Ashland presently owns 22,123,273 shares of Arch Coal common stock
which represents approximately 57.9% of the total issued and outstanding stock
of Arch Coal.
(b) Ashland has sole voting power and the sole power to dispose or to
direct the disposition of its shares of Arch Coal common stock.
(c) Neither Ashland nor the persons listed in Item 2 has effected any
transaction relating to Arch Coal common stock within the last 60 days except
as disclosed on Schedule II.
(d) Not applicable.
(e) Not applicable.
II. Executive Officers and Directors of Ashland
-------------------------------------------
The beneficial ownership of the common stock of Arch Coal of certain
executive officers and directors of Ashland Inc. is listed on Schedule II. If
not listed on Schedule II, the executive officer or director does not
beneficially own Arch Coal common stock.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer
- ---------------------------
Pursuant to a Stockholders Agreement between Arch Coal, Ashland and
Carboex S.A. ("Carboex"), Arch Coal has agreed to nominate for election as a
director of Arch Coal a person designated by Carboex, and Ashland has agreed,
among other things, to vote its shares of Arch Coal common stock in a manner
sufficient to cause the election of such nominee.
Item 7. Material to be Filed as Exhibits
--------------------------------
Stockholders Agreement between Arch Coal, Ashland and Carboex S.A. dated
April 4, 1997 (filed as Exhibit 7 to Ashland's Schedule 13D (Amendment No. 2)
dated June 22, 1999, and incorporated herein by reference).
Page 6 of 6
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
October 5, 1999
------------------------------
(Date)
/s/ David L. Hausrath
------------------------------
David L. Hausrath
Vice President and General Counsel
Schedule I
DIRECTORS AND EXECUTIVE OFFICERS
OF
ASHLAND INC.
PRINCIPAL OCCUPATIONS AND BUSINESS ADDRESSES
Schedule I
DIRECTORS AND EXECUTIVE OFFICERS
OF
ASHLAND INC.
PRINCIPAL OCCUPATIONS AND BUSINESS ADDRESSES
DIRECTORS PRINCIPAL OCCUPATION*
- ------------------ ----------------------------------------------------
Samuel C. Butler Partner of Cravath, Swaine & Moore, Attorneys, New York, New York
Frank C. Carlucci Chairman of the Board of The Carlyle Group, Washington, D.C.
Paul W. Chellgren Chairman of the Board and Chief Executive Officer of Ashland Inc.,
Covington, Kentucky
Ernest H. Drew Former CEO of Westinghouse Industries and Technology Group
James B. Farley Retired Chairman and Current Trustee of Mutual of New York, New York
Ralph E. Gomory President of the Alfred P. Sloan Foundation, New York, New York
Bernadine P. Healy President of the American Red Cross, Washington, D.C.
Mannie L. Jackson Majority owner and Chairman of the Harlem Globetrotters, International
Patrick F. Noonan Chairman of the Board of The Conservation Fund, Arlington, Virginia
Jane C. Pfeiffer Management Consultant, Vero Beach, Florida
Michael D. Rose Chairman of Midaro Investments, Inc., Memphis, Tennessee
William L. Rouse, Jr. Investments, Naples, Florida
Theodore M. Solso Chairman and Chief Executive Officer of Cummins Engine Company, Inc.,
Columbus, Indiana
For business addresses, see Item 2.
EXECUTIVE OFFICERS BUSINESS ADDRESS PRINCIPAL OCCUPATION
- ------------------ ---------------- --------------------
Paul W. Chellgren P. O. Box 391 Chairman of the Board
Covington, KY 41012 and Chief Executive Officer
James R. Boyd P. O. Box 391 Senior Vice President
Covington, KY 41012 and Group Operating Officer
David J. D'Antoni P. O. Box 2219 Senior Vice President
Columbus, OH 43216 and Group Operating
Officer
J. Marvin Quin P. O. Box 391 Senior Vice President
Covington, KY 41012 and Chief Financial Officer
James J. O'Brien P. O. Box 1400 Senior Vice President;
Lexington, KY 40512 President, The Valvoline
Company
Charles F. Potts APAC, Inc. Senior Vice President;
3340 Peachtree Rd., NE President, APAC, Inc.
Tower Place
Atlanta, GA 30326
Kenneth L. Aulen P. O. Box 391 Administrative Vice
Ashland, KY 41114 President; Controller
Philip W. Block P. O. Box 391 Administrative Vice
Covington, KY 41012 President
J. Dan Lacy P. O. Box 391 Vice President
Covington, KY 41012
David L. Hausrath P. O. Box 391 Vice President and
Covington, KY 41012 General Counsel
Richard P. Thomas P. O. Box 391 Vice President and
Covington, KY 41012 Secretary
Peter M. Bokach P. O. Box 2219 Vice President;
Columbus, OH 43216 President of Ashland
Distribution Company
James A. Duquin P. O. Box 2219 Vice President;
Columbus, OH 43216 President of Ashland
Specialty Chemical Company
Lamar M. Chambers P. O. Box 391 Auditor
Covington, KY 41012
SCHEDULE II
EXECUTIVE OFFICER OF STOCK TRANSACTIONS EFFECTED TOTAL OWNERSHIP
ASHLAND WITHIN PAST 60 DAYS
- --------------------- --------------------------- ---------------
Paul W. Chellgren 34 shares purchased with 8,000 - direct
the September 15, 1999
dividend through the 545 - direct -
the Arch Coal DRIP held in the Arch
Coal DRIP
J. Marvin Quin 1,500 - direct
James R. Boyd 5,000 - direct
Philip W. Block 400 - direct
EXHIBIT INDEX
Stockholders Agreement between Arch Coal, Ashland and Carboex S.A.
dated April 4, 1997 (filed as Exhibit 7 to Ashland's Schedule 13D
(Amendment No. 2) dated June 22, 1999, and incorporated herein by
reference).
