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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-1-1/A
Amendment No. 3
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
ESPRIT TELECOM GROUP PLC
(Name of Subject Company)
GLOBAL TELESYSTEMS GROUP INC.
(Bidders)
ORDINARY SHARES, NOMINAL VALUE OF ONE PENCE PER SHARE,
AND
AMERICAN DEPOSITARY SHARES, EACH REPRESENTING 7 ORDINARY SHARES
(Title of Class of Securities)
29665W104
(American Depositary Shares)
(CUSIP Number of Class of Securities)
GRIER C. RACLIN
1751 PINNACLE DRIVE
NORTH TOWER-12TH FLOOR
MCLEAN, VA 22102
(703) 918-4573
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Bidder)
Copies to:
ALFRED J. ROSS, JR.
SHEARMAN & STERLING
599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022
(212) 848-7056
CALCULATION OF FILING FEE
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TRANSACTION VALUATION AMOUNT OF FILING FEE
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$574,783,773* $159,791
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[X] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
Amount Previously Paid: $137,832
Form or Registration No.: 333-68511
Filing Party: Global TeleSystems Group, Inc.
Date Filed: December 8, 1998
Amount Previously Paid: $21,959
Form or Registration No.: 333-68511
Filing Party: Global TeleSystems Group, Inc.
Date Filed: February 1, 1999
* Note: The proposed maximum aggregate offering price was determined as follows:
(i) the market value per share of the Esprit Telecom Ordinary Shares
(determined as one-seventh of the market value per Esprit Telecom ADS)
multiplied by the maximum number of Esprit Telecom Ordinary Shares which may
be exchanged in the Offer described herein for shares of GTS Common Stock,
plus (ii) the market value per Esprit Telecom ADS, multiplied by the number of
Esprit Telecom ADSs which may be exchanged in the Offer described herein for
shares of GTS Common Stock. Pursuant to Rule 457(c), the market value per
Esprit Telecom ADS is based on the average of the bid and asked price on the
NASDAQ National Market on January 28, 1999. $137,832 of the filing fee was
paid on December 8, 1998. The market value per Esprit Telecom ADS used to
calculate the proposed maximum aggregate offering price for the portion of the
filing fee paid on December 8, 1998 was based on the average of the bid and
asked price on the NASDAQ National Market on December 3, 1998.
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This Amendment No. 3 is filed to supplement and amend the information set
forth in the Tender Offer Statement on Schedule 14D-1 (the "Statement") filed by
Global TeleSystems Group, Inc., a Delaware corporation ("GTS"), upon the terms
and conditions set forth in the Offering Circular/Proxy Statement/ Prospectus
dated February 2, 1999 and in the related Form of Acceptance, Letter of
Transmittal and Notice of Guaranteed Delivery (the "Offering Circular/Proxy
Statement/Prospectus" the "Form of Acceptance," "Letter of Transmittal," and
"Notice of Guaranteed Delivery" respectively, together constituting the
"Offer"), to exchange (i) each outstanding Ordinary Share, nominal value of one
pence each, of Esprit Telecom (as defined below) (the "Esprit Telecom Ordinary
Shares"), and (ii) each outstanding American Depository Share of Esprit Telecom
representing seven Esprit Telecom Ordinary Shares, (the "Esprit Telecom ADSs"),
for new shares of Common Stock, par value $0.10 per share, of GTS (the "Common
Stock"), based on an exchange ratio of (i) 0.1271 of a share of Common Stock for
each Esprit Telecom Ordinary Share, and (ii) 0.89 of a share of Common Stock for
each Esprit Telecom ADS. The Esprit Telecom Ordinary Shares and the Esprit
Telecom ADSs are collectively referred to herein as the "Esprit Telecom
Securities." All capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Offering Circular/Proxy
Statement/Prospectus.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
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(a)(20) -- Press Release, dated March 5, 1999, issued by GTS and
Esprit Telecom announcing the completion of the merger.
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After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
March 5, 1999
Global TeleSystems Group, Inc.
By: /s/ GRIER C. RACLIN
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Name: Grier C. Raclin
Title: Senior Vice President and
General Counsel
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EXHIBIT INDEX
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EXHIBIT
NUMBER DESCRIPTION
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(a)(20) -- Press Release, dated March 5, 1999, issued by GTS and
Esprit Telecom announcing the completion of the merger.
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(a)(20)
[ESPRIT TELECOM LOGO]
[GTS LOGO]
FOR IMMEDIATE RELEASE
GTS AND ESPRIT TELECOM COMPLETE US$5 BILLION MERGER,
CREATING ONE OF THE LARGEST INDEPENDENT PAN-EUROPEAN TELECOMS COMPANY
OPERATIONAL HIGHLIGHTS:
o Europe's largest cross-border fiber optic network, with over 12,000
operational kilometers, a significant lead over any other operator
o Operations in 20 countries across Europe
o Over 35,000 business customers in Western Europe
o A broad portfolio of business and carrier telecommunications services
o Competitive local exchange carriers (CLECs) in five Eastern European
cities, with plans for 12 in Western Europe over the next three years
o Announced joint venture (JV) to build world's first 1.28 terabits
capacity transatlantic cable system
o 3,000 employees
FINANCIAL HIGHLIGHTS:
o Market capitalization of approximately $5 billion
o Latest quarter annualized consolidated revenues of approximately US$565
million for the two companies combined
MCLEAN, VA., U.S. AND LONDON, U.K., MARCH 5, 1999 - Global TeleSystems Group,
Inc. (GTS) (Nasdaq and Easdaq: GTSG) and Esprit Telecom Group plc (Esprit
Telecom) (Nasdaq: ESPRY; Easdaq: ESPR) announced today, in light of yesterday's
release, that - with GTS shareholders having approved the acquisition of all
outstanding Esprit Telecom shares yesterday - the company has now begun to
integrate the two companies.
The completion of this merger puts the combined company firmly on track for
meeting its objective of becoming Europe's premier provider of a wide range of
end-user and carrier communications services. The merger capitalizes on GTS's
position as the leading alternative network operator in Europe and on Esprit
Telecom's position as one of Europe's largest independent pan-European
telecommunications services provider.
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GTS-Esprit Telecom Merger Completed
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Commenting on the successful conclusion on the deal, Gerald W. Thames, GTS's
vice chairman, president and chief executive officer (CEO), said: "This is a
great day for our combined company. Today, GTS is one of the fastest-growing
pan-European telecommunications companies, with a network that currently has a
significant advantage over its nearest competitors. Looking forward, I believe
that about 70 percent of the market's growth will come from providing IP-based
services for data as well as voice. In particular, we need to help customers
overcome the network access bottlenecks they face. We are therefore planning to
have 50 Network Access Points and several web hosting centers up and running in
the next two years.
"Through FA-1, our transoceanic cable JV, GTS's end-to-end European network will
be connected across the Atlantic. In turn, we anticipate this will lead to an
increased customer base, both in the U.S. and in Europe. We are also growing our
Internet business based on our Ebone network and have recently made significant
investments in ISPs in Poland, Hungary and the Czech Republic."
To help realize this vision, David Oertle, formerly CEO of Esprit Telecom, now
assumes his new role as senior advisor to GTS and Thames.
Today, the company also announced structural changes in the senior operational
management team:
o Dr. Hans Peter Kohlhammer, formerly group managing director - sales and
marketing at Esprit Telecom, becomes president of GTS Business Services -
Western Europe. Kohlhammer will maintain his present organization
structure at Esprit Telecom, supplemented by the operations activities
previously managed by Jim Reynolds at Esprit Telecom. This division will
continue to use the Esprit Telecom brand with the tag line "A GTS
Company."
o Kevin Power, managing director, GTS Monaco Access, will integrate all
wholesale activities from Esprit Telecom and GTS under a new line of
business as president of GTS Wholesale Services.
o Jim Reynolds, formerly chief operating officer (COO) of Esprit Telecom,
becomes president of Hermes Europe Railtel (HER) and will integrate the
operations of HER and Esprit Telecom Networks (ETN) - 12,200 and
2,030-route kilometers of fiber, respectively. This area includes the
fiber network and the bandwidth business. Reynolds now reports to Jan
Loeber, president of GTS Carrier Services.
As a result, GTS will now operate through six lines of business:
o GTS Business Services - Western Europe under Dr. Hans Peter Kohlhammer
o GTS Access Services under Les Harris, which includes the Central European
region managed by Lou Toth
o GTS Carrier Services under Jan Loeber
o GTS Wholesale Services under Kevin Power
o GTS Business Services - CIS under Stewart Reich
o GTS Mobile Services under Gerard Essing
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GTS-Esprit Telecom Merger Completed
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The presidents of these lines of business report to Bruno d'Avanzo, GTS's
executive vice president and COO. In addition, NetSource Europe ASA will
continue to operate as an independent business unit, managed by John Cronin,
reporting directly to d'Avanzo as well. At a later date NetSource will be
integrated under GTS Business Services - Western Europe.
The combination of the two companies' assets is expected to create a strong
service offering in the European telecommunications market. Customers are
expected to benefit from the synergies between the two companies' networks and
services. Esprit Telecom has one of the most highly developed sales and
marketing structures of any alternative telecommunications services company in
Europe, with an extensive pan-European customer base and strong back office and
customer service expertise. GTS has strength in running successful CLEC and
carriers' carrier services. The successful combination of this expertise is
expected to result in a better overall product and service offering for GTS
customers.
Global TeleSystems Group is a leading independent owner and operator of
telecommunications companies throughout Europe. GTS has six primary lines of
business: GTS Carrier Services, which provides cross-border transport in Europe
to other telecommunications companies; GTS Wholesale Services, which provides
switched and other value-added services to carriers; GTS Access Services, which
provides facilities-based access services to businesses throughout Europe; GTS
Business Services - Western Europe, which offers voice, data, Internet and other
telecommunications services to businesses; GTS Business Services - Commonwealth
of Independent States (CIS), where GTS is a leading alternative provider of high
quality telecommunications services in Moscow, Kiev, St Petersburg and other
cities in Russia and the CIS; and GTS Mobile Services - CIS, which operates
cellular businesses in Russia and Ukraine.
Visit our website at www.gtsgroup.net. For additional information, contact:
FOR GTS:
Robert Capozzi Rosemary Drummond/Henrietta Skeen
Tel: +1-703-918-4548 Biss Lancaster
Pager: +1-800-331-4741 Tel: +44-171-497-3001
[email protected] Mobile: 0468-568-940
[email protected]
FOR ESPRIT TELECOM, A GTS COMPANY:
Glenn Manoff Adrian King
Tel: +44-118-918-4010 Millbank Public Relations
[email protected] Tel: +44-171-436-2100
Fax: +44-171-436-2600
[email protected]
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GTS-Esprit Telecom Merger Completed
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The Offer is being made in the U.S. by Bear, Stearns & Co. Inc. and outside the
U.S. by Bear, Stearns International Limited on behalf of GTS.
Bear, Stearns International Limited, which is regulated by The Securities and
Futures Authority Limited in the conduct of its investment business in the
United Kingdom, and Bear, Stearns & Co. Inc. (together "Bear Stearns") are
acting exclusively for GTS and are acting for no one else in connection with the
Offer and will not be responsible to anyone other than GTS for providing the
protections afforded to customers of either Bear Stearns entity nor for
providing advice in relation to the Offer. The provisions of this paragraph are
not intended to disclaim any liability of either Bear Stearns entity under U.S.
securities laws.
Copies of this announcement are not being, and must not be, mailed or otherwise
distributed or sent in or into Canada, Australia or Japan and persons receiving
this announcement (including custodians, nominees and trustees) must not
distribute or send it in or into Canada, Australia or Japan.
THIS PRESS RELEASE INCLUDES FORWARD-LOOKING STATEMENTS THAT INVOLVE RISK AND
UNCERTAINTY. ALTHOUGH THE COMPANY BELIEVES ITS EXPECTATIONS REFLECTED IN SUCH
FORWARD-LOOKING STATEMENTS ARE BASED ON REASONABLE ASSUMPTIONS, NO ASSURANCE CAN
BE GIVEN THAT SUCH PROJECTIONS WILL BE FULFILLED. ANY SUCH FORWARD-LOOKING
STATEMENT MUST BE CONSIDERED ALONG WITH KNOWLEDGE THAT ACTUAL EVENTS OR RESULTS
MAY VARY MATERIALLY FROM SUCH PREDICTIONS DUE TO, AMONG OTHER THINGS, POLITICAL,
ECONOMIC OR LEGAL CHANGES IN THE MARKETS IN WHICH GTS DOES BUSINESS, COMPETITIVE
DEVELOPMENTS OR RISKS INHERENT IN THE COMPANY'S BUSINESS PLAN. READERS ARE
REFERRED TO THE DOCUMENTS FILED BY GTS WITH THE U.S. SECURITIES AND EXCHANGE
COMMISSION, SPECIFICALLY THE MOST RECENT REPORTS FILED UNDER THE SECURITIES
EXCHANGE ACT OF 1934 AND REGISTRATION STATEMENTS FILED PURSUANT TO THE
SECURITIES ACT OF 1933, WHICH IDENTIFY IMPORTANT RISK FACTORS.
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