EXHIBIT 99.1
FOR IMMEDIATE RELEASE
VIATEL REALIGNS OPERATIONS TO ENHANCE FOCUS
ON HIGH- GROWTH BUSINESSES
STREAMLINING OPERATIONS EXPECTED TO IMPROVE MARGINS AND EBITDA
NEW YORK, NY (JANUARY 17, 2001) - VIATEL, INC. (NASDAQ: VYTL) today announced
that, going-forward, the Company will focus principally on its high-growth,
higher-margin Corporate and Broadband business segments, and will conclude its
provision of consumer voice services in countries that do not meet long-term
corporate objectives. Viatel's actions represent a logical evolution of the
Company as it completes the three-year build-out of its network.
"By streamlining operations and concentrating principally on the pan-European
communications needs of major corporations and carriers, Viatel will immediately
strengthen its current financial profile and improve its EBITDA," said Michael
J. Mahoney, Viatel's Chairman and Chief Executive Officer. "Most importantly,
however, this plan will allow Viatel to continue growing a sustainable business
that will maximize value for our shareholders."
These steps include:
|X| Closing consumer-oriented businesses in several European countries;
|X| Consolidating operating units; and
|X| Reducing staff by an estimated 30%.
Viatel currently offers managed bandwidth (e.g., building-to-building
connectivity, VPNs, IP-VPNs, etc.), advanced data services (e.g., frame relay,
ATM and IP), dedicated and dial-up Internet access, and dedicated voice services
to Corporate customers, and various Broadband solutions, including dark fiber,
managed capacity and wavelengths to the carrier, ISP, ASP and SAN markets. On a
combined basis, Viatel's business in these market segments grew by 129% percent
during the past 12 months.
Mahoney continued, "In just over two years, we have brought one of the most
extensive and technologically advanced multi-gigabit network in Europe from
concept to operating reality. With the recent activation of our Yellow Submarine
trans-Atlantic cable system, the imminent completion of our Pan-European
Network, and the orderly build-out of our seven-city local fiber networks, we
are now better positioned than any other European-centric telecommunications
company to meet the inter- and intra-continental networking needs of major
corporations. Now is the time to devote all of our efforts to leveraging this
next-generation platform to address the networking explosion that has only just
begun in Europe.
"Nearly three years ago, we saw a market imperative - a convergence of
competitive forces and bandwidth requirements in Europe that could only be met
by the rapid construction of a borderless, next generation optical network.
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"The past contributions of our consumer voice business played a critical role in
providing the wherewithal to construct a state-of-the-art network and transform
the Company from a network user, to a network owner and operator, while
minimizing our internal cash burn during the network construction phase.
"Today, however, we see a new and equally compelling imperative emerging. The
communications needs of our core customers are changing so rapidly that we must
move aggressively to realign our unmatched network and bandwidth assets; our
strong and growing Enterprise customer base; and the significant human
technology assets built from our own experience and the acquisition of AT&T
Comms UK last year to better serve the burgeoning demands of our customers."
ABOUT VIATEL: Viatel is the builder-owner-operator of state-of-the-art
pan-European, trans-Atlantic and metropolitan fiber-optic networks and provider
of advanced telecommunications products and services, including bandwidth, to
corporations, carriers, ISPs, ASPs and SANs.
# # #
Certain matters discussed in this release are forward-looking statements that
involve risks and uncertainties, including construction risks and other risks
detailed from time to time in the Company's registration statements and reports
filed with the Securities and Exchange Commission, including those in the
Company's Form 10-K for the year ended December 31, 1999.
CONTACTS:
Investor Relations:
VIATEL: Cindy Glynn, Director of Investor Relations
Glenn Davidson, Senior Vice President, Corporate Communications &
External Affairs
+ 1 212 350 9200
AGENCY: Gerard Wichers, Smithfield Financial, +44 (0) 207 903 0673
Media Relations:
VIATEL: Glenn Davidson, Senior Vice President, Corporate Communications &
External Affairs
+1 212 350 9200
AGENCY: John Hindle, Landmark Consultants, +44 (0) 207 318 6900
Mark Woolfenden, Smithfield Financial, +44 (0) 207 903 0632
(Financial Media)
Lee Feldman, Peters & Feldman, +1 203 854 6761
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