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
Date of Report (Date of earliest event
reported): March 31, 1997
BROOKS FIBER PROPERTIES, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
0-28036
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(Commission File Number)
43-1656187
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(I.R.S. Employer Identification Number)
425 Woods Mill Road South, Suite 300
St. Louis, Missouri 63017
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (314) 878-1616
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ITEM 5. OTHER EVENTS.
On March 31, 1997, the Company concluded a definitive agreement with
Century Telephone Enterprises, Inc., a Louisiana corporation ("Century"), for
the merger of Metro Access Networks, Inc., a Delaware corporation ("MAN"),
Century's competitive local exchange carrier in Texas, into Brooks Fiber
Communications of Texas, Inc., a Delaware corporation wholly-owned by the
Company ("BFC of Texas"). MAN has systems in operation or under development in
seven Texas cities, including 326 route miles of fiber optic cable (representing
a 31% increase in the Company's route miles nationwide) in operating networks in
Austin, Dallas, Fort Worth and San Antonio and networks under development in
Corpus Christi, Houston and Waco. The definitive agreement provides for the
purchase price to be paid through the issuance of approximately 5,000,000 shares
of the Company's Common Stock. Consummation of the transaction is subject to,
among other conditions, regulatory approvals.
A copy of the Company's press release dated March 31, 1997, with
respect to the transaction described above, is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements of Businesses Acquired.
Not Applicable.
(b) Pro Forma Financial Information.
Not Applicable.
(c) Exhibits.
Exhibit No. Description of Exhibit
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99.1 Press release issued by the registrant on March 31, 1997
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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.
BROOKS FIBER PROPERTIES, INC.
Date: April 3, 1997 By: David L. Solomon
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David L. Solomon
Executive Vice President and Chief Financial
Officer (Principal Financial and Accounting
Officer)
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EXHIBIT INDEX
Exhibit No. Description of Exhibit
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99.1 Press release issued by the registrant on March 31, 1997
[Corporate Logo] BROOKS FIBER PROPERTIES
Your Gateway Brooks Fiber Properties, Inc.
To The 425 Woods Mill Road South/Suite 300
Information Age Town & Country, Missouri 63017
314 878-1616 Fax 314 878-3211
FOR IMMEDIATE RELEASE
Contact: Waymon R. Tipton
Senior Vice President
(800) 799-8914, ext. 313
BROOKS FIBER PROPERTIES AND CENTURY TELEPHONE
ENTERPRISES, INC. SIGN DEFINITIVE AGREEMENT TO MERGE METRO
ACCESS NETWORKS, INC. WITH BROOKS FIBER
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MERGER TO ESTABLISH BROOKS IN KEY STATE OF TEXAS WITH
FIBER NETWORKS IN SEVEN CITIES
St. Louis, MO (March 31, 1997) - Brooks Fiber Properties, Inc. (Nasdaq/NM:BFPT)
today announced the signing of a definitive agreement with Century Telephone
Enterprises, Inc. (NYSE:CTL) for the merger of Metro Access Networks, Inc.
("MAN"), Century's competitive local exchange carrier (CLEC) in Texas, and
Brooks Fiber. The merger will consist of MAN's networks in seven Texas cities,
including 326 route miles of fiber optic cable (representing a 31% increase in
Brooks Fiber's route miles nationwide) in operating networks in Dallas, Ft.
Worth, San Antonio and Austin and networks under development in Houston, Corpus
Christi and Waco. In exchange, the shareholders of MAN will receive
approximately 5,000,000 shares, based upon an exchange rate of $20.60 per share,
of Brooks Fiber common stock and will have representation on Brooks Fiber's
Board of Directors. As a result, Century will own approximately 12% of the
outstanding common stock of the Company.
In addition, Brooks Fiber and Century intend to form a joint venture to
develop full-service competitive local exchange networks in new markets
throughout the state of Michigan on a 50/50 basis, allowing both companies to
leverage their respective strengths in the Michigan market. The consummation of
this transaction, which is expected in the second quarter of 1997 is subject to
certain regulatory approvals and certain other closing conditions.
Commenting on the announcement, James C. Allen, Brooks Fiber
Properties' chief executive officer, said, "With four of the Texas networks
fully operational, this transaction will provide Brooks Fiber an early-to-market
advantage in these key markets without incurring significant development
expenses. Importantly, this acquisition, when combined with our other recently
announced expansions into new cities, does not change the Company's previously
announced expectations regarding the timing of peak EBITDA losses and subsequent
EBITDA breakeven. In addition, by establishing a significant presence in Texas
through this merger, we believe the Company has built a critical mass of assets
in operation or in development sufficient to provide service in a very cost
effective manner
-MORE-
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BFPT Signs Definitive Agreement With Century Telephone
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March 31, 1997
nationwide. Since Brooks Fiber's founding some three years ago, our strategy has
included a significant focus on growing via strategic acquisitions and new
market development. This acquisition places us at least twelve months ahead of
our expansion goals and reduces that focus greatly, allowing us to concentrate
on efficiently growing our existing markets in order to move quickly toward
EBITDA breakeven.
"We are very enthusiastic about strategic partnership with Century and
the natural operational synergies that this relationship will create. By
leveraging Brooks Fiber's CLEC expertise with the extensive full service LEC
experience of Century, we believe this combination creates a stronger operating
Company better positioned to pursue the full range of rapidly expanding CLEC
opportunities. Equally important, this relationship signifies the confidence
that an established, large and sophisticated telecommunications company like
Century has placed in Brooks Fiber, and once again reaffirms the inherent value
in the market for competitive local exchange service."
Allen continued, "This purchase also provides us with an excellent
opportunity to expand our national coverage and establish a strategic market
presence in Texas, the third largest telecommunications state in the country.
The addition of these markets represents a significant increase in our
addressable market potential, to approximately $29 billion for 44 markets from
approximately $21 billion in our existing 37 markets, and places us well ahead
of our strategic goal to reach 40 cities by the end of 1997."
Glen P. Post, III, President and Chief Executive Officer of Century,
commented, "We view this transaction as a tremendous opportunity for both
Companies to leverage their unique strengths and capabilities, and fully
capitalize on the opportunities that competition brings to the dynamic
telecommunications marketplace. In looking for a strategic partner, we surveyed
the CLEC industry and believe that Brooks Fiber has the most to offer Century,
as their experience and success have demonstrated a superior ability to execute
and be a leading competitive local exchange carrier."
The statements contained in this release which are not historical facts
are forward-looking statements that involve risks and uncertainties. Management
wishes to caution the reader that these forward-looking statements are only
predictions; actual events or results may differ materially as a result of risks
facing the Company. Such risk include, but are not limited to, the Company's
ability to move more quickly toward EBITDA breakeven and the Company and Century
joint-venture's ability to successfully market its services to current and new
customers, access markets, identify, finance and complete suitable acquisitions,
design fiber optic backbone routes, install cable and facilities, including
switching, and obtain rights-of-way, building access rights and any required
governmental authorizations, franchises and permits, all in a timely manner, at
reasonable costs and on satisfactory terms and conditions, as well as favorable
regulatory, legislative and judicial developments.
Century Telephone Enterprises, Inc., provides a range of communications
services including local exchange, wireless, long distance and Internet access
to more than one million customers in 14 states. The Company, headquartered in
Monroe, Louisiana, is publicly traded on the New York Stock Exchange under the
symbol CTL. Century is the 16th largest local exchange telephone company, based
on access lines, and the 12th largest cellular company, based on population
equivalents owned, in the United States. Visit Century's corporate website at
www.centurytel.com.
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BFPT Signs Definitive Agreement With Century Telephone
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March 31, 1997
Brooks Fiber Properties, Inc., headquartered in St. Louis, Missouri, is
a leading full service provider of competitive local telecommunications services
in cities across the United States. With networks operational or under
development in 44 U.S. cities, the Company provides its customers with advanced
and reliable high-capacity voice, video, data and other enhanced services.
You can now receive fax copies of recent Brooks Fiber news releases 24
hours a day by calling 1-800-758-5804 and entering 102207 or visit Brooks Fiber
on the Internet at www.Brooks.net.
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