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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) November 30, 1994
Rochester Telephone Corporation
(Exact name of registrant as specified in its charter)
New York 1-4166 16-0613330
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
180 South Clinton Avenue
Rochester, New York 14646
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (716) 777-1000
Item 5 Other Events
On November 30, 1994, Rochester Telephone Corporation announced
an agreement to acquire all of the outstanding shares of American
Sharecom, Inc., a long distance company headquartered in Minneapolis,
Minnesota.
As permitted by General Instruction F to Form 8-K, the Registrant
incorporates by reference the information contained in the press release
which is filed as an Exhibit to this Report on Form 8-K.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf of the undersigned hereunto duly authorized.
Rochester Telephone Corporation
(Registrant)
Dated: November 30, 1994 By: /s/ Barbara J. LaVerdi
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Barbara J. LaVerdi
Assistant Secretary
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EXHIBIT INDEX
Exhibit Number Description
- -------------- ---------------
99 Press Release dated Filed herewith
November 30, 1994
regarding acquisition
of American Sharecom, Inc.
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Contact:
Rochester Tel Center See last page
180 South Clinton Avenue
Rochester, New York 14646-0700
Media Relations:
Phone 716-777-1090
Fax 716-325-4624
For release: After 9:00 a.m., November 30, 1994
Rochester Tel to Acquire Minnesota Long Distance Company
Rochester, New York -- November 30, 1994 -- Rochester Tel (NYSE: RTC)
today announced an agreement to acquire all of the outstanding shares
of American Sharecom, Inc. (ASI), a long distance company headquartered
in Minneapolis, Minnesota. ASI is one of the largest privately owned
long distance companies in the country with annual revenues of
approximately $125 million. ASI's sales operations are concentrated in
the Midwest, Northwest and California. Together with Rochester Tel's
pending acquisition of West Coast Communications (WCT), this
acquisition firmly establishes the nationwide presence of RCI Long
Distance, Rochester Tel's long distance subsidiary.
A definitive agreement with the shareholders of ASI has been
approved by Rochester Tel's Board of Directors subject to some final
due diligence items and regulatory approvals in the states in which
American Sharecom does business. Under the agreement, Rochester Tel
will acquire all of the outstanding shares of ASI in exchange for RTC
common stock. Rochester Tel will account for the transaction as a
pooling of interests and expects closing in the first quarter of 1995.
This is Rochester Tel's second long distance acquisition
announced in the last month. On November 8, the company reached a
definitive agreement with WCT Communications on terms of its
acquisition of the California-based long distance company. The
combination of WCT, American Sharecom and RCI Long Distance will bring
Rochester Tel's annual long distance revenues to over $550 million and
make RCI the seventh largest long distance company in the country.
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Commenting on the transaction, Ronald L. Bittner, Chairman and
Chief Executive Officer of Rochester Tel, said, "We are creating the
premier firm in our industry and the addition of American Sharecom
represents a major step toward that goal. Steve Simon, president of
ASI and Jim Weinert, vice president, have built one of the finest,
independent long distance companies in the industry. This merger is
consistent with our growth strategy of expanding our long distance
operations nationwide."
As a private company, ASI had reached a critical point in its
development, according to ASI's Simon. "Given the changing competitive
structure of our industry, we felt that a wider diversity of products
and substantially greater financial capacity were important to our
future success," he said. "In RTC we have found the ideal partner. We
confidently look forward to continuing Rochester Tel's record of growth
in revenue and earnings."
In the joint announcement, Rochester Tel and American Sharecom
said that Simon will become a vice president of the combined long
distance operation, with responsibilities for the American Sharecom
Division. Weinert will remain in charge of American Sharecom's sales
and marketing organization.
Dale Gregory, president of Rochester Tel's telecommunications
group, noted that RCI has no long distance sales or operations
personnel based in the upper Midwest and that Minneapolis will become
the focal point of this new long distance market. Rochester Tel
operates a 100,000 access-line telephone company in Minnesota, Vista
Telephone, and a cellular acquisition in southern Minnesota is pending.
"In long distance, we grew more than 35 percent last year and are
up another 30 percent this year," said Gregory. "We will need the
employees of American Sharecom to help us meet the needs of an
expanding customer base."
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Rochester Tel has a special shareowner meeting scheduled for
December 19 in New York City to approve a pending corporate
reorganization which includes changing its name to Frontier
Corporation. These steps will continue, but the proxy issued in advance
of that meeting will be updated as a result of the ASI announcement to
further describe the transaction, including Rochester Tel's issuance of
approximately 8.7 million shares of its common stock, 95 percent of
which will be restricted.
Founded in 1921, Rochester Tel is one of the largest non-Bell
telecommunications firms in the United States, with 1993 revenues of
$906 million. The company is a provider of integrated
telecommunications solutions to more than 1.5 million customers in the
Northeast, South and Midwest through its long distance, local telephone
and wireless communication companies. Its long distance operation
provides a full range of voice, video and data communications services
for business and residential customers. RCI has nine switch locations
and had revenues of $263 million in 1993.
In October of this year, the New York State Public Service
Commission approved Rochester Tel's corporate restructuring plan,
authorizing it to form a corporate holding company. Rochester Tel has
previously announced its plan, subject to shareowner approval, to name
the holding company Frontier Corporation effective January 1, 1995.
Contacts:
For Rochester Tel: Media - Linda J. Crociata 716-777-7693; investors -
Philip H. Yawman 716-777-6179; mergers and acquisitions - John K.
Purcell, corporate vice president 716-777-7944.
For American Sharecom: William King, Chief Financial Officer,
612-343-3263
Fact sheet follows
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Rochester Tel
Acquisition of American Sharecom Inc.
Fact Sheet
Transaction Summary
- RTC to issue approximately 8.7 million shares of new stock
- Tax deferred exchange for all stock of ASI
- Pooling of interests
- Subject to regulatory approvals and completion of due diligence
- Closing expected in first quarter 1995
- ASI's principal shareowners remain employees of the company in
senior management positions. They have signed management and
noncompete agreements.
- Slightly accretive to RTC earnings and cash in 1995.
Background on American Sharecom
- Long distance company which provides switched and dedicated
outbound long distance, 800 inbound, travel cards, international,
conference calling, private line, operator toll assistance and directory
assistance.
- Certified to do business in Minnesota, Wisconsin, Illinois, Iowa,
North Dakota, South Dakota, Montana, Wyoming, Utah, Colorado,
Nevada, Washington, Idaho, Oregon and California.
- Maintains switching centers in Milwaukee, Billings, Seattle,
Sacramento and Los Angeles. Three switches are DEX 400s, two are
Stromberg Carlson.
- Headquarters in Minneapolis; sales offices in Minneapolis,
Milwaukee, Billings, Spokane, Seattle, Portland and Sacramento.
- Approximately 225 employees.
- Current annualized revenue approximately $125 million. Over 80
percent of ASI's revenue is derived from 60,000 small and medium
sized retail accounts.
A picture illustrating the Switch Sites, Major Points of Presence and
Backbone Network of the RCI Network after integration of American
Sharecom, Inc. and WCT Communications, Inc. is attached to the Press
Release.
