Staff Recommends the Commission Approve the Merger
MONROE, La. and DENVER – CenturyLink Inc. (NYSE:CTL, news, filings) and Qwest Communications (NYSE: Q) have reached an agreement with the staff of the Arizona Corporate Commission (ACC) and the Residential Utility Consumer Office (RUCO) on the proposed merger of the two companies.
The commission staff and the RUCO find that the merger is consistent with and not contrary to the public interest, and that it should be approved by the ACC based on the terms and conditions in the agreement. The staff’s recommendation is subject to review and approval by the commission members.
The companies, the ACC staff and the RUCO agreed to a resolution of retail and wholesale issues, which includes the companies providing regular integration updates and reports. Additionally, the combined company will invest a minimum of $70 million in broadband infrastructure in Arizona over five years.
“Qwest thanks the ACC staff and the RUCO for their diligence throughout this process,” said Jim Campbell, Qwest Arizona president. “This comprehensive settlement recognizes the benefits of the proposed merger for residential and business customers in Arizona.”
“The needs of Arizona consumers were a primary consideration during the review,” said John Jones, vice president of state government affairs for CenturyLink. “It was a thorough process, and we are pleased that it resulted in the staff’s support of the merger.”
In addition to the commission staff and the RUCO in Arizona, CenturyLink and Qwest have reached merger agreements with the staff of the Colorado Public Utilities Commission and the Minnesota Department of Commerce. In Utah, the companies have agreements with the Utah Division of Public Utilities, the Utah Office of Consumer Services and the Salt Lake Community Action Program. In addition, agreements have been reached with the federal government in Arizona, Colorado and Utah. The companies also have entered into agreements with Integra Telecom, Cox Communications and other competitive local exchange carriers.
CenturyLink and Qwest have received more than half of the state regulatory approvals needed to complete the transaction. Earlier this month, the Iowa Utilities Board approved the merger, bringing the total number of approvals to 12 states and the District of Columbia. The companies must receive approvals from nine additional states, including Arizona, and the Federal Communications Commission.
Last month, the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) agreed that the merger is in the public interest and withdrew their previous opposition. The shareholders from both companies approved the merger in August, and the Department of Justice and the Federal Trade Commission cleared the transaction in July after determining there were no antitrust concerns. The merger is expected to close during the first half of 2011.
For more information about the merger, visit centurylinkqwestmerger.com.
CenturyLink is a leading provider of high-quality broadband, entertainment and voice services over its advanced communications networks to consumers and businesses in 33 states. CenturyLink, headquartered in Monroe, La., is an S&P 500 company and is included among the Fortune 500 list of America’s largest corporations. For more information on CenturyLink, visit www.centurylink.com.
Customers coast to coast turn to Qwest’s industry-leading national fiber-optic network and world-class customer service to meet their communications and entertainment needs. For residential customers, Qwest offers a new generation of fiber-optic-fast Internet service, high-speed internet solutions, as well as home phone, Verizon Wireless, and DIRECTV® services. Fortune 500 companies and other large businesses and wholesale customers, as well as small businesses and governmental agencies, choose Qwest to deliver a full suite of network, data and voice services. Additionally, Qwest participates in Networx, the largest communications services contract in the world and is recognized as a leader in the network services market by leading technology industry analyst firms.
Forward Looking Statements
Except for the historical and factual information contained herein, the matters set forth in this communication, including statements regarding the expected timing and benefits of the acquisition such as efficiencies, cost savings, enhanced revenues, growth potential, market profile and financial strength, and the competitive ability and position of the combined company, and other statements identified by words such as "estimates," "expects," "projects," "plans," and similar expressions are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, many of which are beyond our control. Actual events and results may differ materially from those anticipated, estimated or projected if one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect. Factors that could affect actual results include but are not limited to: the ability of the parties to timely and successfully receive the required approvals of regulatory agencies and their respective shareholders; the possibility that the anticipated benefits from the acquisition cannot be fully realized or may take longer to realize than expected; the possibility that costs or difficulties related to the integration of Qwest's operations into CenturyLink will be greater than expected; the ability of the combined company to retain and hire key personnel; the timing, success and overall effects of competition from a wide variety of competitive providers; the risks inherent in rapid technological change; the effects of ongoing changes in the regulation of the communications industry; the ability of the combined company to effectively adjust to changes in the communications industry and to successfully introduce new product or service offerings on a timely and cost-effective basis; any adverse developments in commercial disputes or legal proceedings; the ability of the combined company to utilize net operating losses in amounts projected; changes in our future cash requirements; and other risk factors and cautionary statements as detailed from time to time in each of CenturyLink's and Qwest's reports filed with the Securities and Exchange Commission (SEC). There can be no assurance that the proposed acquisition will in fact be consummated. You should be aware that new factors may emerge from time to time and it is not possible for us to identify all such factors nor can we predict the impact of each such factor on the acquisition or the combined company. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this communication. Unless legally required, CenturyLink and Qwest undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.