<PAGE> 1
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: July 25, 1994
AIRTOUCH COMMUNICATIONS
A California Commission File I.R.S. Employer
Corporation No. 1-12342 No. 94-2995122
425 Market Street, San Francisco, California 94105
Telephone Number (415) 658-2000
<PAGE> 2
Form 8-K AirTouch Communications
July 25, 1994
Item 5. Other Events
On July 25, 1994, AirTouch Communications and U S West issued the
document set forth in Exhibit 99 hereto.
Item 7. Financial Statements and Exhibits
(c) Exhibit:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
99 AirTouch Communications and U S West press release
issued and dated July 25, 1994 entitled AirTouch and
U S West Agree to Merge Cellular Operations
</TABLE>
<PAGE> 3
Form 8-K AirTouch Communications
July 25, 1994
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.
AIRTOUCH COMMUNICATIONS
By /s/ L. L. Christensen
----------------------------
Executive Vice President and
Chief Financial Officer
July 25, 1994
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- -----------
<S> <C>
99 AirTouch Communications and U S West press release issued and
dated July 25, 1994 entitled AirTouch and U S West Agree to
Merge Cellular Operations
</TABLE>
<PAGE> 1
July 25, 1994
AIRTOUCH AND U S WEST
AGREE TO MERGE CELLULAR OPERATIONS
--Companies Form Wireless Joint Venture To Serve Nationwide Market--
AirTouch Communications (NYSE:ATI) and U S WEST, Inc. (NYSE:USW) today
announced a definitive agreement to combine their domestic cellular assets.
The joint venture creates a national wireless company with high-growth markets,
an experienced management team and extensive geographic reach.
By combining their cellular properties, the companies will gain a competitive
advantage through significantly increased marketing scope and large-scale
operating efficiencies. The initial equity ownership of the cellular joint
venture is 70 percent AirTouch and 30 percent U S WEST.
Together, AirTouch and U S WEST own cellular licenses in 9 of the top 20 U.S.
markets and 16 of the top 30 markets, covering more than 53 million potential
customers (POPs). The two companies serve more than 1.7 million cellular
customers across the country. The companies' combined cellular properties
offer broad geographic coverage, particularly in the western half of the United
States where cellular coverage stretches along the west coast corridor from
Canada to Mexico, and in most states west of the Mississippi River. The joint
venture also includes the Atlanta area and several Midwest markets in Michigan
and Ohio.
In addition to merging their domestic cellular operations, the two companies
have formed a joint venture to pursue new Personal Communications Services
(PCS) opportunities that complement existing cellular holdings. The PCS joint
venture will participate in the upcoming FCC broadband auctions. The PCS joint
venture is owned and operated equally by the two companies.
"This partnership implements our strategy of expanding our wireless footprint
with a company that shares our commitment to customers, shareholders and the
future of the industry," said Sam Ginn, chairman and chief executive officer of
AirTouch Communications. "Together we are a wireless powerhouse, with our
sights set on creating a national wireless operation through PCS and other
growth opportunities.
"The wireless industry is being driven by rapidly growing subscriber
penetration, advances in technology, changes in public policy and tremendous
customer demand," he added. "As partners, we are poised to capitalize on the
window of opportunity that will shape the landscape of the wireless industry
for the next century."
<PAGE> 2
"AirTouch and U S WEST share a strategic vision, operating philosophy and
management approach, providing a strong foundation for a successful and
rewarding partnership," said Richard D. McCormick, chairman and chief executive
officer of U S WEST, Inc. "Both companies have strong track records in terms
of wireless technology, product innovation and customer focus. By pooling our
resources and wireless operating expertise, we are well-positioned to deliver
exceptional products and services to consumers across the country.
"Today's consumers want choice in what they buy and where they buy. The scale
and scope advantages created by the joint venture not only will immediately
improve operating cash flow, they will bring new product marketing and
distribution opportunities to deliver more choices to more customers in more
places," said McCormick. "This wireless partnership is consistent with our
philosophy that the needs of our customers and shareholders are often best
served by joining forces with other strategic partners, like Time Warner,
TeleCommunications, Inc., and Cable & Wireless."
STRUCTURE
To allow AirTouch to continue providing interLATA wireless services, free of
Modification of Final Judgment (MFJ) constraint, each company's cellular
properties initially will continue operating as separate entities owned by the
individual partners, but will report to a joint Wireless Management Company,
which will provide support services. U S WEST remains subject to MFJ
restrictions and cannot offer wireless interLATA services.
The Wireless Management Company, led by Lee Cox, AirTouch Cellular president
and chief executive officer, will centralize corporate staff functions and
provide support services to both AirTouch Cellular and U S WEST Cellular on a
contract basis until the two companies fully merge their operations. It also
will provide these support services to the PCS joint venture company. John
DeFeo, president and chief executive officer of U S WEST NewVector Group, will
continue to direct U S WEST Cellular operations and will report to Cox.
Areas where some functions initially will be consolidated include advanced
technology, external affairs, finance, headquarters sales and distribution,
human resources, information systems, marketing, new product development,
purchasing and strategic planning. The integrated management of these support
functions will maximize the operating efficiency of the joint venture.
A complete merger of the two companies' cellular operations will take place
upon the earlier of four years from today, the lifting of certain MFJ
restrictions, or at AirTouch's option. The definitive agreement gives U S WEST
significant strategic flexibility, including the right to convert its 30
percent ownership position into direct ownership of AirTouch stock at private
market value upon MFJ relief and no later than 10 years from closing.
<PAGE> 3
LEADERSHIP
A Partnership Committee, led by Lee Cox and composed of three other AirTouch
representatives, three U S WEST representatives and one mutually agreed upon
independent representative, will oversee the companies' combined domestic
cellular operations as well as the PCS joint venture. The joint venture
company will be based in Walnut Creek, California, near San Francisco.
Other members of the Partnership Committee include from AirTouch: Sam Ginn;
Chris Christensen, chief financial officer; Arun Sarin, vice president -
Corporate Strategy/Development and Human Resources; and from U S WEST: Chuck
Lillis, executive vice president and chief planning officer; Steve Boyd, vice
president-Wireless Business Development; and one other officer to be named
soon. The independent member has not yet been selected.
Building on the company's experience in operating the world's first personal
communications network in the United Kingdom, U S WEST will appoint the
president of the PCS joint venture in two to three weeks. In addition,
discussions are currently in progress with Time Warner to determine its
interest in participating in the PCS joint venture.
"This partnership is built on unparalleled management and wireless operations
experience," said Cox. "Between us, we have deployed and operated a vast array
of cellular and PCS systems in the U.S. and abroad. U S WEST's first-hand
experience competing against two established cellular carriers in the U.K. will
be especially valuable in our PCS joint venture. We view this wireless
experience as a pillar of strength that will give us a competitive edge."
While the two companies' international businesses are not included in the joint
venture, both AirTouch and U S WEST remain committed to making resources
available for international opportunities.
NEXT STEPS
In markets where the partners own competing cellular operations, such as San
Diego, the conflicts will be eliminated. Wherever possible, these conflicting
assets will be traded for other properties rather than sold.
The initial joint venture requires certain federal and state regulatory
approvals. The transaction is tax-free and is expected to close in second
quarter 1995.
<PAGE> 4
CONTACTS: FOR RELEASE
Susan Rosenberg, AirTouch July 25, 1994
(510) 210-3910 8:30 a.m. EDT
Lois Leach, U S WEST
(303) 793-6355
AIRTOUCH AND U S WEST AGREE TO MERGE CELLULAR OPERATIONS
Companies Form Wireless Joint Venture To Serve Nationwide Market
NEW YORK--AirTouch Communications (NYSE:ATI) and U S WEST, Inc. (NYSE:USW) today
announced a definitive agreement to combine their domestic cellular assets. The
joint venture creates a national wireless company with high-growth markets, an
experienced management team and extensive geographic reach.
By combining their cellular properties, the companies will gain a
competitive advantage through significantly increased marketing scope and
large-scale operating efficiencies. The initial equity ownership of the cellular
joint venture is 70 percent AirTouch and 30 percent U S WEST.
Together, AirTouch and U S WEST own cellular licenses in 9 of the top 20
U.S. markets and 16 of the top 30 markets, covering more than 53 million
potential customers (POPs). The two companies serve more than 1.7 million
cellular customers across the country. The companies' combined cellular
properties offer broad geographic coverage, particularly in the western half of
the United States where cellular coverage stretches along the west coast
corridor from Canada to Mexico, and in most states west of the Mississippi
River. The joint venture also includes the Atlanta area and several Midwest
markets in Michigan and Ohio.
In addition to the merging their domestic cellular operations, the two
companies have formed a joint venture to pursue new Personal Communications
Services (PCS) opportunities that complement existing cellular holdings. The PCS
joint venture will participate in the upcoming FCC broadband auctions. The PCS
joint venture is owned and operated equally by the two companies.
"This partnership implements our strategy of expanding our wireless
footprint with a company that shares our commitment to customers, shareholders
and the future of the industry," said Sam Ginn, chairman chief executive officer
of AirTouch Communications. "Together we are a wireless powerhouse, with our
sights set on creating a national wireless operation through PCS and other
growth opportunities.
"The wireless industry is being driven by rapidly growing subscriber
penetration, advances in technology, changes in public policy and tremendous
customer demand," he added. "As partners, we are poised to capitalize on the
window of opportunity that will shape the landscape of the wireless industry for
the next century."
"AirTouch and U S WEST share a strategic vision, operating philosophy and
management approach, providing a strong foundation for a successful and
rewarding partnership," said Richard D. McCormick, chairman and chief executive
officer of U S WEST, Inc. "Both companies have strong track records in terms of
wireless technology, product innovation and customer focus. By pooling our
resources and wireless operating expertise, we are well-positioned to deliver
exceptional products and services to consumers across the country.
"Today's consumers want choice in what they buy and where they buy. The
scale and scope advantages created by the joint venture not only will
immediately improve operating cash flow, they will bring new product marketing
and distribution opportunities to deliver more choices to more customers in more
places," said McCormick. "This wireless partnership is consistent with our
philosophy that the needs of our customers and shareholders are often best
served by joining forces with other strategic partners, like Time Warner,
TeleCommunications, Inc., and Cable & Wireless."
<PAGE> 5
STRUCTURE
To allow AirTouch to continue providing interLATA wireless services, free
of Modification of Final Judgment (MFJ) constraints, each company's cellular
properties initially will continue operating as separate entities owned by the
individual partners, but will report to a joint Wireless Management Company,
which will provide support services. U S WEST remains subject to MFJ
restrictions and cannot offer wireless interLATA services.
The Wireless management Company, led by Lee Cox, AirTouch Cellular
president and chief executive officer, will centralize corporate staff functions
and provide support services to both AirTouch Cellular and U S WEST Cellular on
a contract basis until the two companies fully merge their operations. It also
will provide these support services to the PCS joint venture company. John
DeFeo, president and chief executive officer of U S WEST NewVector Group, will
continue to direct U S WEST Cellular operations and will report to Cox.
Areas where some functions initially will be consolidated include advanced
technology, external affairs, finance, headquarters sales and distribution,
human resources, information systems, marketing, new product development,
purchasing and strategic planning. The integrated management of these support
functions will maximize the operating efficiency of the joint venture.
A complete merger of the two companies' cellular operations will take place
upon the earlier of four years from today, the lifting of certain MFJ
restrictions, or at AirTouch's option. The definitive agreement gives U S WEST
significant strategic flexibility, including the right to convert its 30 percent
ownership position into direct ownership of AirTouch stock at private market
value upon MFJ relief and no later than 10 years from closing.
LEADERSHIP
A Partnership Committee, led by Lee Cox and composed of three other
AirTouch representatives, three U S WEST representatives and one mutually agreed
upon independent representative, will oversee the companies' combined domestic
cellular operations as well as the PCS joint venture. The joint venture company
will be based in Walnut Creek, California, near San Franciso.
Other members of the Partnership Committee include from AirTouch: Sam Ginn;
Chris Christensen, chief financial officer; Arun Sarin, vice president-Corporate
Strategy/Development and Human Resources; and from U S WEST: Chuck Lillis,
executive vice president and chief planning officer; Steve Boyd, vice
president-Wireless Business Development; and one other officer to be named soon.
The independent member has not yet been selected.
Building on the company's experience in operating the world's first
personal communications network in the United Kingdom, U S WEST will appoint the
president of the PCS joint venture in two to three weeks. In addition,
discussions are currently in progress with Time Warner to determine its interest
in participating in the PCA joint venture.
"This Partnership is built on unparalleled management and wireless
operations experience," said Cox. "Between us, we have deployed and operated a
vast array of cellular and PCS systems in the U.S. and abroad. U S WEST's
first-hand experience competing against two established cellular carriers in the
U.K. will be especially valuable in our PCS joint venture. We view this wireless
experience as a pillar of strength that will give us a competitive edge."
While the two companies' international businesses are not included in the
joint venture, both AirTouch and U S WEST remain committed to making resources
available for international opportunities.
NEXT STEPS
In markets where the partners own competing cellular operations, such as
San Diego, the conflicts will be eliminated. Wherever possible, these
conflicting assets will be traded for other properties rather than sold.
<PAGE> 6
The initial joint venture requires certain federal and state regulatory
approvals. The transaction is tax-free and is expected to close in second
quarter 1995.
AirTouch Communications, formerly PacTel Corporation, is involved in
cellular, paging, vehicle location and international ventures in many of the
world's top markets, including the U.S., Japan, Germany, Sweden, France, Spain,
Portugal, Belgium, Italy, South Korea and Thailand. The company, which is based
in San Francisco, serves more than 2.7 million customers worldwide. It was spun
off from Pacific Telesis Group on April 1, 1994.
U S WEST is in the connections business, helping customers share
information, entertainment and communications services in local markets
worldwide. U S WEST's major subsidiary, U S WEST Communications, provides
services to 25 million customers in 14 western and midwestern states. U S WEST's
international businesses include cellular telephone systems in Hungary, the
Czech Republic, Slovakia and Russia; Mercury One-2-One, a personal
communications network in the United Kingdom; cable TV and telephone networks in
the U.K., France, Norway, Sweden and Hungary; international gateway telephone
switches in Russia and Lithuania; and telephone directory operations in Poland
and the U.K.
