-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UYhMmCPhd7BDLZ0NITrFF8Qq62GTy0JXxPrErjZqJ0Je+vglAesVvp1fXPKYWCVV pwRndawIcolCRs8RJ28Lhw== 0001019056-98-000157.txt : 19980331 0001019056-98-000157.hdr.sgml : 19980331 ACCESSION NUMBER: 0001019056-98-000157 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980326 ITEM INFORMATION: FILED AS OF DATE: 19980327 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: QWEST COMMUNICATIONS INTERNATIONAL INC CENTRAL INDEX KEY: 0001037949 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 841339282 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-22609 FILM NUMBER: 98577114 BUSINESS ADDRESS: STREET 1: 555 17TH ST STE 1000 CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 3032911400 MAIL ADDRESS: STREET 1: 555 17TH STREET STE 100 CITY: DENVER STATE: CO ZIP: 80202 FORMER COMPANY: FORMER CONFORMED NAME: QUEST COMMUNICATIONS INTERNATIONAL INC DATE OF NAME CHANGE: 19970416 8-K 1 FORM 8-K 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 (Date of earliest event reported): March 26, 1998 QWEST COMMUNICATIONS INTERNATIONAL INC. ---------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE ---------------------------------------------- (State or other jurisdiction of incorporation) 000-22609 84-1339282 ---------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 555 SEVENTEENTH STREET, SUITE 1000 DENVER, COLORADO 80202 ------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 303-291-1400 ------------- NOT APPLICABLE ------------------------------------------------------------- (Former name or former address, if changed since last report) ITEM 5. OTHER EVENTS On March 26, 1998, the Registrant and certain stockholders of EUnet International Limited, a company organized under the laws of England ("EUnet"), a leading, Amsterdam-based, European Internet service provider with business units operating in 13 European countries, entered into a definitive Transaction Agreement (the "EUnet Transaction Agreement"), to acquire EUnet for approximately $154 million in cash and Qwest Common Stock (as defined below). Pursuant to the EUnet Transaction Agreement, the holders of all of the preference shares, "A" ordinary shares and options of EUnet and of more than 92% of the ordinary shares of EUnet have agreed to sell their shares or options to the Registrant. At the closing, EUnet stockholders and optionholders will receive 3,621,590 newly issued shares of common stock, par value $.01 per share, of the Registrant ("Qwest Common Stock"), having a deemed value of approximately $135.5 million (based upon a deemed value of approximately $37.42 per share), and approximately $4.5 million in cash. In addition, they will receive approximately $14.4 million in cash (plus interest to the date of payment), or (at the Registrant's option) additional shares of Qwest Common Stock having that value (based upon an average of the closing prices for a specified 15-day period), in connection with the registration under the Securities Act of 1933, as amended (the "Securities Act"), of the resale of the shares of Qwest Common Stock issued at the closing. Shares of Qwest Common Stock (included in the $154 million referred to above) having a deemed value of $23 million will be placed in escrow for two years, and may be recovered by the Registrant, to satisfy any indemnification claims. The closing of the transactions contemplated by the EUnet Transaction Agreement is conditioned on the satisfaction of certain customary conditions, including the receipt of certain regulatory approvals. The parties expect the closing to occur in April 1998. Promptly thereafter, the Registrant will acquire any remaining ordinary shares of EUnet by means of a compulsory purchase under applicable law. The acquisition will be accounted for as a purchase. The shares of Qwest Common Stock will be issued to EUnet stockholders in a private placement exempt from registration under the Securities Act. The Registrant has agreed to undertake the registration of the resale of the shares of Qwest Common Stock under the Securities Act not later than, and such shares will not be freely tradeable until, the earlier of (i) three weeks after the closing of the Merger or (ii) September 30, 1998 (or, under certain circumstances, a later date, but no later than October 31, 1998). The joint press release dated March 26, 1998 of the Registrant and EUnet announcing the execution of the Transaction Agreement is filed with the Securities and Exchange Commission as Exhibit 99.1 to this Current Report on Form 8-K. The Registrant cautions that the press release contains forward-looking statements that include, among others, statements concerning the Registrant's plans to complete an approximately 16,250 route mile coast-to-coast, technologically advanced, fiber optic telecommunications network (the "Qwest Network"), expectations as to funding its capital requirements, anticipated expansion of carrier and commercial services and other statements of expectations, beliefs, future plans and strategies, anticipated developments and other matters that are not historical facts. The Registrant cautions that these forward-looking statements 1 are subject to risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied by the statements. Important factors that could prevent the Registrant from achieving its stated goals include, but are not limited to; (i) failure by the Registrant to manage effectively, cost efficiently and on a timely basis the construction of the Qwest Network route segments; (ii) failure by the Registrant to enter into additional customer contracts to sell dark fiber or provide high-volume capacity and otherwise expand its telecommunications customer base; (iii) failure by the Registrant to obtain and maintain all necessary rights-of-way; (iv) intense competition in the Registrant's carrier services and commercial services markets; (v) the potential for rapid and significant changes in technology and their effect on the Company's operations; (vi) operating and financial risks related to managing rapid growth and integrating acquired businesses; (vii) adverse changes in the regulatory environment; (viii) failure by the Registrant to consummate the previously announced merger with LCI International Inc. timely or at all; and (ix) risks of being highly leveraged and sustaining operating cash deficits. The shares of Qwest Common Stock to be issued in the transaction have not been registered under the Securities Act and, unless so registered or an exemption from registration is available, may not be offered or sold in the United States or its territories and possessions or to any "U.S. Person" (within the meaning of the Securities Act) and hedging transactions involving such shares may not be conducted unless in compliance with the Securities Act. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS Exhibit 99.1 Press release of the Registrant and EUnet International Limited dated March 26, 1998. 2 SIGNATURES 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. QWEST COMMUNICATIONS INTERNATIONAL INC. DATE: March 27, 1998 By: /s/ ROBERT S. WOODRUFF --------------------------------- Robert S. Woodruff Executive Vice President - Finance, Chief Financial Officer and Treasurer S-1 EXHIBIT INDEX Exhibit 99.1 Press release of the Registrant and EUnet International Limited dated March 26, 1998. A-1 EX-99.1 2 EXHIBIT 99.1 QWEST CORPORATE CONTACT: QWEST INVESTOR CONTACT: QWEST MEDIA CONTACT: - ----------------------- ---------------------- ------------------- Qwest Qwest Communications Alexander Communications Communications Lee Wolfe Erin McKelvey Diane Reberger (800) 567-7296 (303) 615-5070 x108 Pgr: (800)800-9456 LWOLFE@QWEST.NET emckelve@alexander-pro.com DREBERGER@QWEST.NET HTTP://WWW.QWEST.NET HTTP://WWW.ALEXANDER-PR.COM - ------------------- -------------------- --------------------------- HTTP//WWW.QWEST.NET - ------------------- EUNET CORPORATE CONTACT: EUNET MEDIA CONTACT: - ----------------------- ------------------- EUnet International The Weber Group Helen Miller Jeremy Morgan +31 20 530 5333 +44 171 240 6189 media@eu.net JMorgan@webergroup.co.uk HTTP://WWW.EU.NET - ----------------- QWEST ENTERS EUROPEAN DATA MARKET IN 13 COUNTRIES THROUGH ACQUISITION OF EUNET INTERNATIONAL LTD. DENVER - AMSTERDAM, NETHERLANDS - MARCH 26, 1998 - Qwest Communications International Inc. today announced it has agreed to acquire Amsterdam-based EUnet International in a cash and stock transaction valued at approximately $154 million. EUnet is a leading European Internet service provider (ISP) with business units operating in 13 countries - Austria, Belgium, Finland, France, Spain, Portugal, Norway, Sweden, Luxembourg, Czech Republic, Switzerland, Romania and Estonia. EUnet had revenues in 1997 of approximately $55 million, and 1998 revenues are expected to reach $16 million in the first quarter and over $75 million for the entire year. EUnet has over 400 employees and serves approximately 60,000, primarily business, customers throughout Europe. In addition, Qwest will fund EUnet's recent acquisition of a 50 percent interest in X-Link, a leading German Internet service provider. The board of directors of each company has approved the acquisition and the requisite number of EUnet shareholders has agreed to the transaction. EUnet shareholders will receive approximately $135.5 million in newly issued shares of Qwest common stock, approximately $4.5 million in cash, and approximately $14.4 million in cash or additional Qwest shares at Qwest's option. The acquisition will be accounted for as a purchase. The closing is subject to the satisfaction of certain customary conditions, including the receipt of applicable securities law approval. The parties expect to consummate the acquisition within 30 days. "The European data market is exploding to an estimated $55 billion by the year 2000. The Internet is the driving force behind this trend," said Joseph P. Nacchio, president and CEO A-2 at Qwest. "EUnet has extensive Internet expertise and an understanding of Europe's diverse national markets and regulatory issues. The liberalization of the European telecommunications market and our recently acquired transatlantic capacity, combined with the EUnet acquisition, allow Qwest to provide business customers with high performance and cost effective end-to-end data and Internet services between Norm America and Europe." "EUnet recognizes that the future of Internet usage rides on the ability to move large amounts of data and images quickly and without error. Partnering with Qwest allows the two companies to capitalize on their expertise in IP data networking products and to leverage the superior Qwest network infrastructure to deliver a leading edge American-European data strategy," said Jim Omand, Chairman of the Board at EUnet International. "Joining Qwest will allow us to further expand our presence in Europe and to continue to deliver to our customers the data network services that have made EUnet a market leader." The Qwest shares will be issued in a private placement exempt from registration under the Securities Act of 1933. Qwest has agreed to register the shares for resale under the Securities Act within three weeks after the closing of the previously announced merger between Qwest and LCI International, Inc. or by September 30, 1998, if earlier (or under certain circumstances as late as October 31, 1998). THE QWEST MACRO CAPACITY(SM) FIBER NETWORK Qwest's planned domestic 16,250 mile network will serve more than 125 cities, which represent approximately 80 percent of the data and voice traffic originating in the United States, upon its scheduled completion in the second quarter of 1999. Currently, nearly 3,750 miles are activated from Los Angeles to Cleveland; and from Dallas to Houston. Qwest is also extending its network 1,400 miles into Mexico with completion slates for late third quarter 1998. The Qwest Macro Capacity Fiber network is designed with a highly reliable and secure bi-directional, line switching OC-192 SONET ring architecture. Upon completion, the network will offer a self-healing system that provides the ultimate security and reliability by allowing instantaneous rerouting in the event of a fiber cut. ABOUT EUNET Established in 1982 and the first European provider of Internet services for business use, EUnet was instrumental in creating Europe's Internet infrastructure. Today, EUnet International provides, via subsidiaries, affiliated companies and business partners, one-stop shopping for corporate Internet access in Europe with a network spanning over 42 countries and more than 400 PoPs (Points of Presence). Via its transit-free backbone, EUnet International offers the business community a wide range of turnkey solutions from full-service, centrally-managed connectivity and Intranets to mobile access, Webcasting, Web Storefront and Electronic Commerce solutions. For more information, please visit EUnet's website at WWW.EU.NET. A-3 ABOUT QWEST Qwest Communications International Inc. (NASDAQ:QWST) is a multimedia communications company building a high-capacity, fiber optic network for the 21st century. With its cutting-edge technology, Qwest will deliver high-quality data, video and voice connectivity securely and reliably to businesses, consumers and over communications service providers. Further information is available at WWW.QWEST.NET ### This release may contain forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to the documents filed by Qwest with the SEC, specifically the most recent reports filed under the Securities Exchange Act of 1934, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including potential fluctuations in quarterly results, dependence on new product development, rapid technological and market change, failure to complete the network on schedule, failure to consummate the proposed merger with LCI International timely or at all, volatility of stock price, financial risk management and future growth subject to risks. Information regarding EUnet (including forecasts of results of operation for 1998 or portions thereof) have been provided by EUnet and have not been verified by Qwest or its representatives. No assurance can be given with respect to such information or that such forecasts will be realized. This announcement is not an offer to sell or a solicitation to buy any securities of Qwest. Any offering securities will be made only pursuant to a prospectus prepared by Qwest. The Qwest shares to be issued in the transaction have not been registered under the Securities Act and, unless so registered or an exemption from registration is available, may not be offered or sold in the United States or its territories and possessions or to any "U.S. Person" (within the meaning of the Securities Act) and hedging transactions involving such shares may not be conducted unless in compliance with the Securities Act. The Qwest logo is a registered trademark of Qwest Communications International Inc. in the U.S. and certain other countries. A-4 -----END PRIVACY-ENHANCED MESSAGE-----