UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 5)
MAGELLAN HEALTH SERVICES, INC.
------------------------------
(Name of Issuer)
Common Stock, $0.25 par value
-----------------------------
(Title of Class of Securities)
559079108
---------
(CUSIP Number)
Murray A. Indick
Blum Capital Partners, L.P.
909 Montgomery Street, Suite 400
San Francisco, CA 94133
(415) 434-1111
--------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 17, 2002
-----------------
(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 [ ].
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
Page 1 of 10
CUSIP NO. 559079108 SCHEDULE 13D Page 2 of 10
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1. NAME OF REPORTING PERSON BLUM STRATEGIC PARTNERS, L.P.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 94-3303833
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS* WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
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7. SOLE VOTING POWER -0-
NUMBER OF -----------------------------------------------------------
SHARES 8. SHARED VOTING POWER 1,362,300**
BENEFICIALLY
OWNED BY EACH -----------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER -0-
-----------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,362,300**
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,362,300**
------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.9%
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14. TYPE OF REPORTING PERSON PN
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** See Item 5 below
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 559079108 SCHEDULE 13D Page 3 of 10
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1. NAME OF REPORTING PERSON BLUM STRATEGIC GP, L.L.C.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 94-3303831
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS* See Item 3
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
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7. SOLE VOTING POWER -0-
NUMBER OF -----------------------------------------------------------
SHARES 8. SHARED VOTING POWER 1,362,300**
BENEFICIALLY
OWNED BY EACH -----------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER -0-
-----------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,362,300**
------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,362,300**
------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.9%**
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14. TYPE OF REPORTING PERSON OO (Limited Liability Company)
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** See Item 5 below
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 559079108 SCHEDULE 13D Page 4 of 10
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1. NAME OF REPORTING PERSON BLUM CAPITAL PARTNERS, L.P.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 94-3205364
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS* See Item 3
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION California
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7. SOLE VOTING POWER -0-
NUMBER OF -----------------------------------------------------------
SHARES 8. SHARED VOTING POWER 1,362,300**
BENEFICIALLY
OWNED BY EACH -----------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER -0-
-----------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,362,300**
------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,362,300**
------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.9%**
------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON PN, IA
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** See Item 5 below
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 559079108 SCHEDULE 13D Page 5 of 10
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1. NAME OF REPORTING PERSON RICHARD C. BLUM & ASSOCIATES, INC.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 94-2967812
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS* See Item 3
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION California
------------------------------------------------------------------------------
7. SOLE VOTING POWER -0-
NUMBER OF -----------------------------------------------------------
SHARES 8. SHARED VOTING POWER 1,362,300**
BENEFICIALLY
OWNED BY EACH -----------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER -0-
-----------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,362,300**
------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,362,300**
------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.9%**
------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
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** See Item 5 below
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 559079108 SCHEDULE 13D Page 6 of 10
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1. NAME OF REPORTING PERSON RICHARD C. BLUM
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [x]
------------------------------------------------------------------------------
3. SEC USE ONLY
------------------------------------------------------------------------------
4. SOURCE OF FUNDS* See Item 3
------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A.
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7. SOLE VOTING POWER -0-
NUMBER OF -----------------------------------------------------------
SHARES 8. SHARED VOTING POWER 1,362,300**
BENEFICIALLY
OWNED BY EACH -----------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER -0-
-----------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,362,300**
------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,362,300**
------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.9%**
------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON IN
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** See Item 5 below
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 559079108 SCHEDULE 13D Page 7 of 10
This Amendment No. 5 amends the Statement on Schedule 13D (the "Schedule 13D")
filed with the Securities and Exchange Commission (the "Commission") on
October 8, 2002 by Blum Capital Partners, L.P., a California limited
partnership ("Blum L.P."); Richard C. Blum & Associates, Inc., a California
corporation ("RCBA Inc."); Blum Strategic GP, L.L.C., a Delaware limited
liability company ("Blum GP"); Blum Strategic Partners, L.P., a Delaware
limited partnership ("Strategic"), and Richard C. Blum, the Chairman and a
substantial shareholder of RCBA Inc. and a managing member of Blum GP
(collectively, the "Reporting Persons"). This amendment relates to shares of
Common Stock, par value $0.25 (the "Common Stock") of Magellan Health
Services, Inc., a Delaware corporation (the "Issuer"). The principal
executive office and mailing address of the Issuer is 6950 Columbia Gateway
Drive, Suite 400, Columbia, Maryland 21046. The following amendments are
hereby made. Unless otherwise defined herein, all capitalized terms shall
have the meanings ascribed to them in the Schedule 13D.
Item 5. Interest in Securities of the Issuer
---------------------------------------------
(a),(b) According to the Issuer's most recent Form 10-Q, there were 35,138,686
shares of Common Stock outstanding as of July 31, 2002. Based on such
information, after taking into account the transactions described in Item 5(c)
below, the Reporting Persons report the following direct holdings of the Common
Stock and corresponding percentage interest of total shares outstanding: (i)
Strategic reports direct holdings of 836,600 shares of the Common Stock (2.4%);
(ii) Blum LP and RCBA Inc. report holdings of 477,600 shares of the Common
Stock (1.4%) owned directly by the limited partnerships for which Blum LP
serves as the general partner and Blum LP's investment advisory client
accounts; and (iii) Mr. Blum reports the aggregate of these shares for a total
of 1,314,200 shares of the Common Stock, which represents 3.7% of the
outstanding shares of the Common Stock.
In addition, because Blum LP has voting and investment power with respect to
48,100 shares that are legally owned by The Common Fund for the account of its
Multi-Strategy Equity Fund ("The Common Fund"), those shares are reported as
beneficially owned by Blum LP. The Common Fund is principally engaged in the
business of managing investments for educational institutions. The principal
administrative office of The Common Fund is located at 15 Old Danbury Road,
Wilton, Connecticut 06897-0812. The Common Fund disclaims membership in a
group with any of the Reporting Persons, and disclaims beneficial ownership of
any shares held by the Reporting Persons. Voting and investment power
concerning the above shares are held solely by Blum LP and Blum GP.
CUSIP NO. 559079108 SCHEDULE 13D Page 8 of 10
The Reporting Persons therefore may be deemed to be members in a group, in
which case each Reporting Person would be deemed to have beneficial ownership
of an aggregate of 1,362,300 shares of the Common Stock, which is 3.9% of the
outstanding shares of Common Stock. As the sole general partner of Blum LP,
RCBA Inc. is deemed the beneficial owner of the securities over which Blum LP
has voting and investment power. As Chairman, director and a substantial
shareholder of RCBA Inc., Richard C. Blum might be deemed to be the beneficial
owner of the securities beneficially owned by RCBA Inc. Mr. Blum may also be
deemed to be the beneficial owner of the securities over which Blum GP has
voting and investment power. Although Mr. Blum is joining in this Schedule as
a Reporting Person, the filing of this Schedule shall not be construed as an
admission that he, or any of the other shareholders, directors or executive
officers of RCBA Inc., or managing members and members of Blum GP, is, for any
purpose, the beneficial owner of any of the securities that are beneficially
owned by RCBA Inc. or Blum GP, except to the extent of any pecuniary interest
therein.
The outstanding voting stock of the Issuer as reported on the most recent 10-Q
does not include 59,063 outstanding shares of Series A Redeemable Preferred
Stock that has a right to approximately 6,300,000 shares of the Issuer's
common stock and votes on an 'as converted' basis. See Note L ("Redeemable
Preferred Stock") in the Issuer's audited historical financial statements
contained in the Issuer's Form 10-Q for the period ended June 30, 2002. Were
the Series A Preferred Stock to be converted to common stock and included in
the outstanding shares of the Issuer, the Issuer would have had 41,438,739
outstanding shares as of July 31, 2002 and the Reporting Persons would have
owned 3.3% of the outstanding voting stock of the Issuer.
(c) Since the most recent filing of Schedule 13D, the Reporting Persons sold
the following shares of Common Stock in the open market:
Entity Trade Date Shares Price/Share
------ ---------- ------- -----------
Blum LP's limited partnership 10-16-02 77,200 0.03050
and investment advisory client 10-17-02 308,800 0.03400
accounts (including The Common Fund) 10-18-02 385,900 3.85000
The limited partnership for 10-16-02 122,800 0.03050
which Strategic serves as 10-17-02 491,200 0.03400
the general partner 10-18-02 614,100 3.85000
(d) Not applicable.
(e) As of October 18, 2002, the Reporting Persons ceased to be beneficial
owners of more than five percent of the Common Stock.
Item 7. Material to be Filed as Exhibits
-----------------------------------------
Exhibit A Joint Filing Undertaking.
CUSIP NO. 559079108 SCHEDULE 13D Page 9 of 10
SIGNATURES
After reasonable inquiry and to the best of our knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: October 21, 2002
BLUM STRATEGIC PARTNERS, L.P. BLUM STRATEGIC GP, L.L.C.
By BLUM STRATEGIC GP, L.L.C.
its general partner
By /s/ Murray A. Indick By /s/ Murray A. Indick
------------------------------- ----------------------------
Murray A. Indick, Member Murray A. Indick, Member
RICHARD C. BLUM & ASSOCIATES, INC. BLUM CAPITAL PARTNERS, L.P.
By Richard C. Blum & Associates, Inc.
its general partner
By /s/ Murray A. Indick By /s/ Murray A. Indick
------------------------------- -----------------------------------
Murray A. Indick Murray A. Indick
Partner, General Counsel Partner, General Counsel
and Secretary and Secretary
RICHARD C. BLUM
By /s/ Murray A. Indick
---------------------------------------
By Murray A. Indick, Attorney-in-Fact
CUSIP NO. 559079108 SCHEDULE 13D Page 10 of 10
Exhibit A
JOINT FILING UNDERTAKING
The undersigned, being duly authorized thereunto, hereby execute this
agreement as an exhibit to this Schedule 13D to evidence the agreement of the
below-named parties, in accordance with the rules promulgated pursuant to the
Securities Exchange Act of 1934, to file this Schedule jointly on behalf of
each such party.
Dated: October 21, 2002
BLUM STRATEGIC PARTNERS, L.P. BLUM STRATEGIC GP, L.L.C.
By BLUM STRATEGIC GP, L.L.C.
its general partner
By /s/ Murray A. Indick By /s/ Murray A. Indick
------------------------------- -----------------------------
Murray A. Indick, Member Murray A. Indick, Member
RICHARD C. BLUM & ASSOCIATES, INC. BLUM CAPITAL PARTNERS, L.P.
By Richard C. Blum & Associates, Inc.
its general partner
By /s/ Murray A. Indick By /s/ Murray A. Indick
------------------------------- -----------------------------------
Murray A. Indick Murray A. Indick
Partner, General Counsel Partner, General Counsel
and Secretary and Secretary
RICHARD C. BLUM
By /s/ Murray A. Indick
---------------------------------------
By Murray A. Indick, Attorney-in-Fact