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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) February 18, 2000
PentaStar Communications, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-27709 84-1502003
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
1522 Blake Street, Denver CO 80202
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 825-4400
None
(Former name or former address, if changed since last report.)
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Item 5. Other Events
On February 18, 2000, PentaStar Communications, Inc. (the "Company") (a)
signed an agreement to acquire the assets of Eastern Telecom, Inc. ("ETI") and
(b) signed an agreement to acquire, and completed the acquisition of, the assets
of USTeleCenters, Inc. and Vermont Network Services Corporation. The acquisition
of the assets of ETI is contingent upon receipt of the approval of the
shareholders of VSI Enterprises, Inc., which is the parent company of ETI. On
February 22, 2000, the Company completed the acquisition of assets of Network
Communications Integration. Attached to this Current Report on Form 8-K as
Exhibit 99 is a copy of the Company's related press release dated February 22,
2000.
Item 7. Financial Statements and Exhibits
Exhibit 99 Press release of the Company dated February 22, 2000.
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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: March 2, 2000 PENTASTAR COMMUNICATIONS, INC.
By: /s/ David L. Dunham
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David L. Dunham
Chief Financial Officer
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EXHIBIT 99
[PENTASTAR COMMUNICATIONS, INC. LOGO]
PENTASTAR COMMUNICATIONS, INC. ANNOUNCES
STRATEGIC ACQUISTIONS
* * *
UPON COMPLETION, ACQUISITIONS WILL INCREASE
PENTASTAR'S REVENUE BY NEARLY 300%
Denver, Colorado (February 22, 2000) - PentaStar Communications, Inc. (NASDAQ:
PNTA), a communications services agent, today announced a series of strategic
acquisitions that position the company as one of the largest communications
services agents in the country. In separate transactions, the company has signed
a definitive agreement to acquire Eastern Telecom, Inc. ("ETI") and completed
the purchase of USTeleCenters, Inc. and Vermont Network Services Corporation
(collectively "UST"), and Network Communications Integration ("NCI").
At the IPO in October 1999, PentaStar commenced operations with annualized run
rate revenue of approximately $6 million. These announced acquisitions will
increase PentaStar's annualized run rate revenue to approximately $23 million,
an increase of nearly 300%, enabling rapid entrance to new markets and
additional service provider relationships. Upon closing of the ETI acquisition,
PentaStar's operations will consist of nearly 240 experienced professionals with
proven industry knowledge in strategy, design, integration and deployment of
communications solutions for small and medium size businesses.
The combined purchase price for these transactions was approximately $3.35
million in cash and PentaStar common stock plus certain assumed liabilities. In
addition, there is a potential earnout payment based upon the earnings of ETI
and UST for the year ending December 31, 2000.
ETI, founded in 1992, is a full-service communications agent based in Warwick,
Rhode Island primarily servicing customers in Boston, New York, Albany,
Providence and Warwick. ETI is an authorized agent for Bell Atlantic and Bell
South. ETI is a wholly-owned subsidiary of VSI Enterprises, Inc. (OTCBB: VSIN).
VSI Enterprises develops, manufactures, markets and supports software based
audio/visual command and control systems and videoconferencing products that
operate on PC platforms.
UST, founded in 1986 and headquartered in Boston, is a full-service
communications agent focusing on small business customers located throughout
Bell Atlantic's 13 state region. UST has agency agreements with service
partners, including Bell Atlantic, Bell South, Southwestern Bell and Sprint. UST
was a subsidiary of ViewTech, Inc. (Nasdaq: VUTK), a leader in video systems
integration.
The acquisitions of ETI and UST establish PentaStar as Bell Atlantic's largest
agent. The ETI acquisition has been approved by the Board of Directors' of both
VSI Enterprises and PentaStar and is expected to close in May 2000 pending VSI
Enterprises shareholder approval.
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"The acquisition of key communications services agents in major metropolitan
areas is critical to our growth plans and part of our stated on-going
acquisition strategy. The strategic acquisitions of ETI, UST and NCI are our
first major milestones as a public company, and they clearly position PentaStar
as one of the largest communications services agents in the country. With the
addition of these new carrier relationships to our existing agreements with US
West, Qwest and Epoch Internet, we broaden our market coverage and provide our
customers with enhanced product offerings and more direct customer service,"
said Bob Lazzeri, Chief Executive Officer of PentaStar.
"In addition, with the acquisition of ETI, PentaStar gains a strong and
experienced leader in Brian Rowley, President of ETI. Brian has 12 years of
experience in the telecom industry and has been successful at deploying a number
of innovative systems and strategies at ETI. Brian will be charged with the
development of the Northeast U.S. and will manage the integration and
realization of cost savings of the combined operations of ETI and UST," added
Lazzeri.
NCI is primarily a long distance communications services agent located in
Seattle, Washington. NCI has carrier agreements with well-established providers
such as Qwest, AT&T, and GST Telecom.
"The acquisition of NCI allows PentaStar to further establish our presence in
the Pacific Northwest, as well as provide the company established relationships
with additional communications services providers," said Neal Tomblyn, President
and Chief Operating Officer of PentaStar.
ABOUT PENTASTAR COMMUNICATIONS, INC.
PentaStar designs, procures and facilitates the installation and use of
communications services solutions that best meet customers' specific
requirements and budgets. PentaStar was formed in March 1999 to become a
communications services agent. Concurrently with its IPO on October 26, 1999,
PentaStar acquired ICM Communications Integration, Inc., a Seattle, Washington
based communications services agent, and DMA Ventures, Inc., d/b/a Access
Communications, a Denver, Colorado based communications services agent, and
commenced its business operations. PentaStar's common stock is traded on the
Nasdaq Small Cap Market under the ticker symbol PNTA. For more complete
information about PentaStar, contact PentaStar Communications, Inc., 1522 Blake
Street, Denver, Colorado 80202, (303) 825-4400, visit the company's website at
www.pentastarcom.com or send an e-mail to [email protected]
This press release may contain forward-looking statements. Such forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results or outcomes to differ materially from those currently
anticipated. Factors that could affect actual results or outcomes include those
described in PentaStar's Registration Statement on Form SB-2, its current report
on Form 8-K dated December 9, 1999 and its Quarterly Report on Form 10-QSB dated
December 10, 1999 and all other Securities and Exchange Commission filings
submitted as of this date.
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CONTACT INFORMATION:
Nancy Shipp
PentaStar Communications Inc.
E-mail: [email protected]
Phone: 303-825-4400
