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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
June 22, 1999
Date of Report (Date of earliest event reported)
QWEST COMMUNICATIONS INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
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Delaware 000-22609 84-1339282
(State of other jurisdiction (Commission (IRS employer
of incorporation) file no.) identification no.)
700 Qwest Tower
555 Seventeenth Street
Denver, Colorado 80202
(Address of principal executive offices) (Zip code)
(303) 291-1400
Registrant's telephone number,
including area code
Not applicable
(Former name or address, if changed since last report)
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Item 5. Other Events.
On June 22, 1999, Qwest Communications International Inc., a Delaware
corporation ("Qwest"), issued a press release in connection with a letter it
delivered on June 22, 1999 to Mr. Solomon D. Trujillo, Chairman, President and
Chief Executive Officer of U S WEST, Inc., a Delaware corporation ("U S
WEST"). A copy of the Qwest press release, dated June 22, 1999, which includes
the letter delivered to Mr. Trujillo, is attached hereto as Exhibit 99.1 and
is incorporated herein by reference.
This Current Report on Form 8-K may contain forward-looking statements
that involve risks and uncertainties. These statements may differ materially
from actual future events or results. Readers are referred to the documents
filed by Qwest with the SEC, specifically the most recent reports which
identify important risk factors that could cause actual results to differ from
those contained in the forward-looking statements, including potential
fluctuations in quarterly results, dependence on new product development,
rapid technological and market change, failure to complete the network on
schedule and on budget, financial risk management and future growth subject to
risks, Qwest's ability to achieve Year 2000 compliance, and adverse changes in
the regulatory or legislative environment. This release and the attachments
include analysts' estimates and other information prepared by third parties
for which Qwest assumes no responsibility. In addition, certain statements
regarding synergies and other projections and information contained in this
release and the attachments are based on publicly available information
regarding U S WEST and Frontier. Qwest undertakes no obligation to review or
confirm analysts' expectations or estimates or such publicly available
information or to release publicly any revisions to any forward-looking
statements to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
Exhibit 99.1 -- Press release of the Registrant, dated June 22, 1999.
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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 thereunto duly authorized.
QWEST COMMUNICATIONS
INTERNATIONAL INC.
By: /s/ Robert S. Woodruff
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Name: Robert S. Woodruff
Title: Executive Vice President -
Finance and Chief Financial
Officer
June 22, 1999
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EXHIBIT INDEX
Exhibit 99.1 -- Press release of the Registrant, dated June 22, 1999.
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Exhibit 99.1
[QWEST LOGO] [GRAPHIC OMITTED]
FOR IMMEDIATE RELEASE
Contacts: Qwest Media: Qwest Investor:
Tyler Gronbach Lee Wolfe
303-992-2155 800-567-7296
[email protected] [email protected]
QWEST COMMUNICATIONS URGES U S WEST BOARD TO ENTER INTO
DISCUSSIONS WITH QWEST REGARDING BUSINESS COMBINATION
-- Superior Qwest Offer Would Benefit U S WEST Shareholders, Customers and
Employees and Would Better Implement U S WEST Vision --
DENVER, June 22, 1999 - Qwest Communications International Inc. (Nasdaq: QWST)
stated today that Joseph P. Nacchio, Chairman and CEO of Qwest, sent a letter
to Solomon D. Trujillo, Chairman, President and CEO of U S WEST, Inc., urging
the U S WEST Board to enter into discussions with Qwest regarding a business
combination. A copy of the letter is attached to this press release.
In the letter, Mr. Nacchio said he was disappointed that the U S WEST Board of
Directors did not fully consider the benefits of the Qwest offer, including
the greater likelihood that Qwest and U S WEST together can achieve U S WEST's
stated vision of creating a data- and wireless- centric company that provides
integrated services inside its current region and globally. Mr. Nacchio also
said that the Qwest proposal offers a value to the U S WEST shareholders
higher than the value of the Global Crossing offer, that the Qwest stock is
stronger and more liquid than the Global Crossing stock, that Qwest offers
greater realizable synergies and upside potential than Global Crossing does,
and that Qwest offers the benefits of a true, integrated merger without the
use of a complex, divisive tracking stock.
"We encourage the U S WEST Board to take all actions necessary to enter into
discussions with us regarding our offer so that we can conclude a business
combination that is in the best interests of U S WEST's shareholders,
customers and employees," Mr. Nacchio said.
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About Qwest
Qwest Communications International Inc. (Nasdaq: QWST) is a leader in reliable
and secure broadband Internet-based data, voice and image communications for
businesses and consumers. Headquartered in Denver, Qwest has more than 8,500
employees working in North America, Europe and Mexico. The Qwest Macro
Capacity(R) Fiber Network, designed with the newest optical networking, spans
more than 18,500 route miles in the United States, with an additional 315-mile
network route to be completed by the end of the year. In addition, Qwest and
KPN, the Dutch telecommunications company, have formed a venture to build and
operate a high-capacity European fiber optic, Internet Protocol-based network
that has 2,100 miles and will span 9,100 miles when it is completed in 2001.
Qwest also has nearly completed a 1,400-mile network in Mexico. For more
information, please visit the Qwest web site at www.qwest.com.
# # #
This release and the attachments may contain forward-looking statements that
involve risks and uncertainties. These statements may differ materially from
actual future events or results. Readers are referred to the documents filed
by Qwest with the SEC, specifically the most recent reports which identify
important risk factors that could cause actual results to differ from those
contained in the forward-looking statements, including potential fluctuations
in quarterly results, dependence on new product development, rapid
technological and market change, failure to complete the network on schedule
and on budget, financial risk management and future growth subject to risks,
Qwest's ability to achieve Year 2000 compliance, and adverse changes in the
regulatory or legislative environment. This release and the attachments
include analysts' estimates and other information prepared by third parties
for which Qwest assumes no responsibility. In addition, certain statements
regarding synergies and other projections and information contained in this
release and the attachments are based on publicly available information
regarding U S WEST. Qwest undertakes no obligation to review or confirm
analysts' expectations or estimates or such publicly available information or
to release publicly any revisions to any forward-looking statements to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
The Qwest logo is a registered trademark of Qwest Communications International
Inc. in the U.S. and certain other countries.
A copy of the letter to Mr. Trujillo follows:
[Qwest Communications International Inc. letterhead]
Mr. Solomon Trujillo
Chairman, President and Chief Executive Officer
U S WEST, Inc.
1801 California Street
Denver, CO 80202
June 22, 1999
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Dear Sol:
We are disappointed by the decision of the U S WEST Board of Directors to not
begin discussions with Qwest regarding our offer to you. Apparently, your
Board has not fully considered the benefits of our offer, which we believe is
financially, structurally and strategically superior to Global Crossing's
offer.
The benefits of the Qwest offer include the following, among others:
o Qwest offers a business combination that is more likely to realize the
stated U S WEST vision of creating a "data- and wireless-centric
company that provides integrated services inside [its] current region
and globally." Qwest has a well- established business and operations,
a fully constructed network and a proven management team with a
record of significant accomplishments. We have successfully managed
Qwest's businesses and consistently exceeded analysts' expectations.
Additionally, our management team has experience in successfully
integrating large acquisitions. In contrast, Global Crossing offers
one undersea cable, less than 200 employees, few customers and a
management team without a track record at the company. Global
Crossing's main feature is its proposed business plan - not its
network, customer base or management.
o Qwest offers a value to U S WEST shareholders higher than that offered
by the Global Crossing proposal. Based upon the closing price of
Qwest's stock on Monday, June 21, 1999, our offer for U S WEST is
worth $65.30 per share to U S WEST shareholders (or 7% more than the
Global Crossing offer), assuming that Qwest enters into an
acquisition agreement with Frontier Corporation, or $63.65 per share
(or 4.3% more than the Global Crossing offer), assuming that Qwest
does not reach such an acquisition agreement. Furthermore, we observe
that the stock price of U S WEST has increased from $54.875 to
$58.313 per share, or by 6%, since Friday, June 11, 1999, the last
trading day before Qwest made its offer. These premiums, we believe,
reflect the agreement by U S WEST shareholders that the Qwest offer
is superior and has greater potential to deliver long-term value.
o Qwest stock is stronger, more stable and more liquid than Global
Crossing stock. We have a substantial public float that is
significantly greater than the public float of Global Crossing. The
volatility of Qwest's stock is less than the historical volatility of
Global Crossing's stock. Due to its thin public float, Global
Crossing's stock price may experience substantial declines if Global
Crossing insiders sell their shares after the closing of the
Frontier/Global Crossing (when their lockups terminate) or if even a
small number of Frontier or U S WEST shareholders elect to sell the
Global Crossing shares they would receive in the mergers with Global
Crossing.
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o Qwest offers greater realizable synergies and upside potential than
Global Crossing. We have a number of specific, identifiable and
quantifiable synergies resulting from a combination with U S WEST. As
we have described before, we believe that the combination will result
in significant operating synergies, aggregating approximately $9.3
billion to $9.75 billion through the year 2005 from the combination
of U S WEST and Qwest. These synergies are much greater than the
vague and unexplained synergies that Global Crossing claims will
result from its offer.
o Qwest offers the benefits of a true merger. Our offer, with its
single class of stock, best serves the shared strategic vision of
Qwest and U S WEST to offer our customers a bundle of services
(including local, long-distance, Internet and data products) through
an owned network with end-to-end connectivity in a world-wide
marketplace. The tracking stock proposed by Global Crossing does not
further this vision. In fact, Global Crossing's tracking stock will
separate management teams, divide assets and operations and create
long-term conflicts between the strategies, objectives and management
of the two entities reflected in a tracking stock structure.
For the reasons given above, and for other reasons, our offer is superior to
the Global Crossing proposal. We believe that the superiority of our offer
will become increasingly evident as the industry and the markets appreciate
the value of the proposed combinations, the quality of Qwest's network,
management and operations and the synergies resulting from the combinations.
We believe the best interests of U S WEST's shareholders, the more than 25
million customers in its 14-state service area, and its employees would be
served if U S WEST's Board of Directors takes the actions necessary to enter
into discussions with Qwest regarding its offer so that we may promptly enter
into an agreement for a business combination. We also believe a business
combination with Qwest will better implement the strategic vision stated by U
S WEST than through the Global Crossing offer.
We look forward to discussing our proposal with you.
Sincerely,
/s/ Joseph P. Nacchio
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