Exhibit 99.1
McLeodUSA Incorporated
McLeodUSA Technology Park
6400 C Street SW, PO Box 3177
Cedar Rapids, IA 52406-3177
Investor Contact: Bryce E. Nemitz
Press Contact: Bruce A. Tiemann
[email protected]
Phone: (319) 790-7800
FAX: (319) 790-7767
FOR IMMEDIATE RELEASE
McLeodUSA Completes Acquisition of CapRock
and Names Hiram Hoed to Lead Southwestern Region
Cedar Rapids, Iowa - December 7, 2000 - McLeodUSA Incorporated (Nasdaq: MCLD)
today announced the completion of its acquisition of CapRock Communications
Corp. (Nasdaq: CPRK) of Dallas, Texas. The two companies announced the
transaction on October 3. Stockholders of CapRock approved the transaction at
a special meeting this week. The acquisition extends the McLeodUSA footprint
for integrated communication services to 25 states, and based on September 30,
2000 data, adds 5,200 miles of fiber, 65 collocations, and 95,000 access
lines.
McLeodUSA also announced today that Hiram Hoed has been named to lead the
Company's retail sales operations in its new Southwestern Region. This region
includes the four states added to the McLeodUSA marketplace in the CapRock
acquisition: Texas, Oklahoma, Louisiana and Arkansas. Mr. Hoed was named a
Group Vice President of McLeodUSA and will be based in Dallas. Hoed has served
in senior executive positions in other CLECs and telecommunications companies
including Nortel and GTE.
"We believe the CapRock transaction is significant on several fronts," said
Steve Gray, McLeodUSA President and COO. "First, their contiguous geography to
our footprint is a great fit. Second, we are pleased with the quality assets
gained in this transaction, enabling us to launch activities in four new
states at an accelerated pace. And finally, we expect to realize positive
operating and capital synergies in 2001 as a result of this transaction."
Gray welcomed Mr. Hoed stating, "Hiram brings a 21-year track record of sales
excellence, team building, and customer development in the telecommunications
sector. He is a proven sales executive and we are pleased to add him to our
industry-leading management team at McLeodUSA." Mr. Hoed joins Donna Stoner,
Group Vice President - Eastern Region; David Lunemann, Group Vice President -
Central Region; and Robert Hatch, Group Vice President - Western Region, all
reporting to Steven Shirar, GVP and McLeodUSA Chief Sales Officer.
Commenting on his new role at McLeodUSA, Mr. Hoed said, "I am very pleased to
be joining this very talented team of individuals at McLeodUSA. I welcome the
challenges and the great opportunities that lie ahead."
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Holders of CapRock stock are receiving 0.3876 of a share of McLeodUSA Class A
common stock for each share of CapRock common stock. McLeodUSA will issue
approximately 15 million shares related to this acquisition. CapRock shares
have ceased trading on The Nasdaq Stock Market(R).
About McLeodUSA
McLeodUSA provides selected telecommunications services to customers
nationwide. Integrated communications including local services are currently
available in several Midwest and Rocky Mountain states; long distance and
advanced data and Internet services are available in all 50 states. McLeodUSA
is a facilities-based telecommunications provider with 375 ATM switches, 37
voice switches, nearly 905,000 local lines, and more than 9,500 employees. The
Company's network is capable of transmitting integrated next-generation data,
video and voice services, reaching 800 cities and 90 percent of the U.S.
population. In the next 12 months, McLeodUSA plans to distribute 30 million
directories in 26 states, serving a population of 51 million. McLeodUSA
Incorporated is a Nasdaq-100 company traded as MCLD. The Company's Web site is
available at www.mcleodusa.com.
Some of the statements contained in this press release discuss future
expectations, contain projections of results of operations or financial
condition or state other forward-looking information. Those statements are
subject to known and unknown risks, uncertainties and other factors that could
cause the actual results to differ materially from those contemplated by the
statements. The "forward-looking" information is based on various factors and
was derived using numerous assumptions. In some cases, you can identify these
so-called forward-looking statements by words like "may," "will," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"projects," "potential," or "continue" or the negative of those words and
other comparable words. You should be aware that those statements only reflect
the predictions of McLeodUSA. Actual events or results may differ
substantially. Important factors that could cause actual events or results of
McLeodUSA to be materially different from the forward-looking statements
include availability of financing and regulatory approvals, the number of
potential customers in a target market, the existence of strategic alliances
or relationships, technological, regulatory or other developments in the
industry, changes in the competitive climate in which McLeodUSA operates and
the emergence of future opportunities. These and other applicable risks are
summarized under the caption "Risk Factors" in the McLeodUSA Annual Report on
Form 10-K for the fiscal year ended December 31, 1999, which is filed with the
Securities and Exchange Commission.
