Filed by Gabriel Communications, Inc.
pursuant to Rule 425 under the Securities Act of 1933
Subject Company: State Communications, Inc.
FOR IMMEDIATE RELEASE
---------------------
GABRIEL COMMUNICATIONS AND TRIVERGENT
ANNOUNCE MERGER AGREEMENT
Creates super-regional ICP in 16 southeastern and midwestern states.
ST. LOUIS, MO AND GREENVILLE, SC, June 13, 2000 - Gabriel Communications and
TriVergent Communications, two rapidly growing, facilities-based broadband
communications companies, today jointly announced that they had entered into an
Agreement and Plan of Merger to combine their two companies to form a
super-regional, facilities-based integrated communications provider. The
combined company has fully-funded plans to develop networks in over 40 markets
in 16 contiguous midwestern and southeastern states.
The development of these networks is well underway as a result of Gabriel's
pursuit of markets in the midwest and TriVergent's deployment of networks in a
contiguous southeastern region. The combined company is expected to have 40
networks operational by year-end 2001 with over 9 million addressable business
lines, more than 25 million total addressable lines and approximately 450
collocations in service. Their current combined equity and debt capitalization
fully funds the continued development of these markets.
On a proforma basis, the combined company currently has approximately 800
employees and total invested and committed capital of over $800 million.
TriVergent and Gabriel are currently operational in a total of 16 markets and
expect that the combined company will be in over 30 markets and will have
approximately 350 collocations in service by year-end 2000. Currently, both
organizations are aggressively rolling out operations in additional markets as
state-of-the-art switches are installed and as both organizations complete the
turn-up of central office collocations and the roll-out of DSL services in their
respective markets.
Robert A. Brooks, Chairman of Gabriel, will serve as Chairman of the combined
company. David L. Solomon, Chief Executive Officer of Gabriel, will become Chief
Executive Officer of the combined company. Charles S. Houser, Chairman and Chief
Executive Officer of TriVergent, will serve as Vice Chairman of the combined
company's Board of Directors. Gerard J. Howe will continue as President and COO
of Gabriel Communications and, in addition, will be President, Strategic
Initiatives of the combined company. G. Michael Cassity, President and COO of
TriVergent, will continue as President and COO of TriVergent and will be
President and COO of the combined company.
"This combination permits us to accelerate significantly both companies'
expansion into contiguous markets with no dilution in the focus of either
management team's current pursuits," said David Solomon. "As Charlie Houser and
I began to hold discussions it became abundantly clear to both of us that
Gabriel and TriVergent share virtually an identical customer and market focus
and network deployment strategy. In addition, our operating support systems are
highly compatible. The combined company will have an extraordinarily deep
management team with the experience and ability to successfully execute our
aggressive business plans."
-MORE-
<PAGE>
Gabriel-TriVergent Merger
Page 2
"What a tremendous opportunity this is to combine growing companies that are
developing on parallel tracks," added Charlie Houser. "We believe this creates a
stronger company and enhances our ability to deliver our data-centric products
and services to our customers more quickly."
Robert Brooks commented that "The combination creates a world-class integrated
communications provider with strong investor support and an experienced
management team to realize its strategic objectives. It also presents exciting
prospects for our stockholders, employees and customers."
TriVergent has been developing networks in South Carolina, North Carolina,
Georgia, Florida, Alabama, Mississippi, Louisiana, Kentucky and Tennessee.
Gabriel's networks reach into Missouri, Illinois, Indiana, Kansas, Oklahoma,
Arkansas, Ohio, as well as Kentucky and Tennessee.
Both companies provide a broad range of dedicated broadband Internet access
products, Web services, and local and long distance telephone service. Gabriel
Communications, through a joint venture with Solutech, Inc., recently launched
WebBizApps, a provider of a variety of web-enabled business applications for
small to medium-sized businesses. Earlier this year, TriVergent debuted
WebArchitect, an automated Web site design product for its customers.
"The advanced, data-centric products offered by our companies demonstrate the
intent our companies have to be innovative in effectively meeting all of the
communications needs of our business customers," added Charlie Houser.
The merger has been unanimously approved by the Boards of Directors of both
Gabriel and TriVergent and stockholders holding more than two-thirds of the
voting stock of both companies have agreed to vote their shares to approve the
merger. Gabriel was advised in the transaction by Salomon Smith Barney Inc. and
TriVergent was advised by Donaldson, Lufkin & Jenrette Securities Corporation
and First Union Securities, Inc. The transaction is subject to regulatory
approvals and clearances, receipt of required consents and other customary
closing conditions. Gabriel plans to file a Registration Statement with the
Securities and Exchange Commission with respect to the combination.
About Gabriel Communications, Inc.
Gabriel Communications is a rapidly growing, facilities-based integrated
communications and applications services provider offering businesses and other
end users the most advanced integrated communications products and services
available, including local voice and data, domestic and international long
distance and high-speed dedicated Internet access, web page hosting and domain
name services. Gabriel packages dedicated high speed Internet access and
"traditional" local and long distance telephone services with unified voice,
e-mail and fax messaging and other advanced data services. Gabriel's network
platforms also allow it to offer comprehensive business solutions, including
browser-based business applications and database management solutions for human
resources, sales, finance, inventory management and other critical business
functions. During 2000,
-MORE-
<PAGE>
Gabriel-TriVergent Merger
Page 3
Gabriel is introducing a variety of new products and services, including DSL
Internet access, web design, LAN and WAN management, e-commence solutions, voice
conferencing, remote access and a variety of web-enabled business applications.
A privately held company, Gabriel's headquarters are located at 16090 Swingley
Ridge Road in Chesterfield, MO.
Contact:
Ron Cook, Gabriel Communications
636-537-5748 (office)
314- 559-3718 (pager)
About TriVergentTM
TriVergent is a broadband telecommunications company offering automated web
design and web hosting, high-speed data and voice services to small and
medium-sized businesses in the southeastern United States.
Contact:
Myron Hosea, TriVergent Communications
864-370-7691
Forward-Looking Statements
Some of the statements contained in this press release that are not historical
facts are "forward-looking statements" (as defined in the Private Securities
Litigation Reform Act of 1995) that involve risks and uncertainties. These
forward-looking statements generally can be identified by the use of
forward-looking terminology such as "will," "may," "should," "believes,"
"intends," "expects," "anticipates," "projects," "estimates" or "predicts" or
the negative thereof or other variations thereon or comparable terminology.
TriVergent and Gabriel wish to caution readers of this press release that these
forward-looking statements regarding matters that are not historical facts are
only predictions and estimates regarding future events and circumstances.
Accordingly, Gabriel and TriVergent can give no assurance that these predictions
and estimates will be realized. Actual events or results may differ materially
as a result of risks facing us, including risks regarding the development of our
respective businesses and the markets for our services and products.
GABRIEL AND TRIVERGENT URGE THEIR RESPECTIVE SECURITY HOLDERS TO READ THE
REGISTRATION STATEMENT TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
REGARDING THE BUSINESS COMBINATION TRANSACTION REFERENCED IN THE FOREGOING
INFORMATION, WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. The Registration Statement will be filed with the Securities and
Exchange Commission and it will be available for free at the Commission's
website www.sec.gov. after it has been filed. This press release does not
constitute an offer to sell or a solicitation of an offer to purchase any
securities.
###
