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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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) January 11, 1999
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IXC Communications, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-20803 74-2644120
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(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
1122 Capital of Texas Highway South, Austin, Texas 78746
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (512) 328-1112
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Not applicable
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS.
On January 11, 1999, IXC Communications, Inc. entered into an agreement
to acquire all of the membership interests in the limited liability companies
which operate as the Coastal Telephone Company for consideration valued at
approximately $100 million, including up to $25 million in IXC Common Stock and
warrants to purchase an additional seventy-five thousand (75,000) shares of IXC
Common Stock. The exercise price of the warrants will be the greater of $45 per
share or the closing price per share as of the trading day immediately preceding
the closing of the transaction. The agreement is subject to certain closing
conditions, including regulatory approval. The closing is expected to take
place in mid-1999.
Attached as Exhibit 99.1 is the press release issued by IXC dated
January 12, 1999 which is incorporated by reference herein.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
99.1 Press release dated January 12, 1999
2.
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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.
Date: January 19, 1999
IXC Communications, Inc.
By: /s/ Stuart K. Coppens
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Stuart K. Coppens,
Vice President of Finance and
Chief Accounting Officer
3.
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EXHIBIT INDEX
Exhibit
Number Description
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99.1 Press release dated January 12, 1999
4.
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EXHIBIT 99.1
IXC COMMUNICATIONS, INC. NEWS RELEASE
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IXC EXPANDS RETAIL BUSINESS WITH
ACQUISITION OF COASTAL TELEPHONE
AUSTIN, TX - January 12, 1999 - IXC Communications, Inc. (Nasdaq: IIXC)
announced today that it will acquire Coastal Telephone Company which will be
combined with and complement its existing business-to-business arm, Eclipse
Telecommunications, Inc. The transaction is valued at approximately $100
million, which includes $25 million in IXC stock.
"The acquisition of Coastal Telephone is exactly consistent with IXC's strategy
of growing our distribution to small to mid-sized companies, enabling us to sell
high margin solutions, and enlarge the market for our new data and Internet
services," said Benjamin L. Scott, IXC's chairman and CEO.
Scott pointed out that the acquisition will allow IXC to sell new IXC products
to Coastal's base of more than 100,000 small business customers; expand
Coastal's scope from regional to nationwide; and couple Coastal's inside sales
with Eclipse's direct sales to more efficiently reach the small and medium-sized
business markets. Scott added that the margins on Coastal's existing traffic
will improve by utilizing IXC's extensive fiber optic network, and Eclipse
overall will see a lower cost of sale with a more efficient sales model to reach
small businesses.
A privately held long distance reseller based in Houston, Texas, Coastal
utilizes a unique team approach to inside sales and has grown its annualized
revenues to more than $90 million of EBITDA positive business.
"Coastal Telephone's strong position in the small business market,
well-structured growth plans, robust agency program, and its experienced
management team are all extremely complementary with the existing small and
mid-market focus of Eclipse," said David Hughart, president of IXC's retail
business division. "This acquisition will allow us to preserve all of Coastal's
strengths and to allow the business to significantly expand through access to
our nationwide fiber network, and a significantly expanded product line."
The completion of this acquisition in the second quarter of this year will allow
Eclipse's direct sales team to concentrate on expansion in the middle market for
business customers. Wholly owned by IXC, Eclipse offers a full range of voice,
data, and Internet services through 30 sales and branch locations around the
country.
Setting Eclipse apart from other communications providers is its unique
combination of advanced products like integrated access; flexible, customized
billing to support business needs; simple, easy-to-understand pricing and
contracts; and the quality and reliability of IXC's state-
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of-the-art digital fiber network. More information about Eclipse is available at
www.eclipsetel.com.
"This is a rare opportunity to access not only a very large and sophisticated
network, but also a wider product offering, including Eclipse's data and
Internet portfolio, to give our customers broader, high-quality, affordable
solutions," said Andrew Bursten, president of Coastal Telephone.
IXC's network-based delivery solutions are designed to address the speed and
capacity requirements of the global communications market. Having completed the
first new coast-to-coast fiber optic network in the United States in more than a
decade, IXC Communications, Inc. is at the forefront of the industry's new class
of emerging domestic and international carriers. IXC offerings include private
line, broadband, Internet and long distance switched and dedicated services. IXC
is a publicly traded company listed on Nasdaq under the symbol IIXC. IXC's Web
site is at www.ixc-comm.com.
Certain of the above statements set forth management's expectations or
predictions of the future based on current facts and analyses. Actual results
may differ materially from those indicated in such statements due to unavoidable
construction delays, increases in expenses, and other factors. Additional
information on factors that may affect the business and financial results of IXC
can be found in IXC's filings with the Securities and Exchange Commission.
# # #
Media Contact: Investor Contact:
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Melissa Jackson Greta Wiechman
Senior Manager, Public Relations Senior Manager, Investor Relations
(512) 231-5247 (888) 267-9478
[email protected] [email protected]
