form425-a.htm
Filed by Frontier
Communications Corporation
Pursuant to Rule
425 under the Securities Act of 1933
and Deemed Filed
Pursuant to Rule 14a-12
Under the
Securities Exchange Act of 1934
Subject Company:
Frontier Communications Corporation
Commission File No.
001-11001
Hi
Everyone,
Today we announced
a truly transformational event for Frontier: An agreement to acquire 4.8 million
Verizon access lines in 14 states. Upon completion of the
transaction, Frontier will be the largest pure-rural communication services
company and the fifth largest ILEC in the country. We will operate in 27 states,
have 16,000 employees, and serve 8.6 million access lines and broadband
connections.
We’re acquiring
operations that are a great fit with our current business. We will
expand our presence in Arizona, California, Idaho, Illinois, Indiana, Michigan,
Nevada, Ohio, Oregon, West Virginia and Wisconsin. We’ll become a new
and important provider in North Carolina, South Carolina and Washington state.
We will improve our balance sheet and create greater cash flow generation
capabilities. We’ll be well positioned for future investments in new
products, technologies and acquisitions.
The transaction is
subject to the approval of Frontier’s shareholders and the satisfaction of
customary closing conditions, financing, and regulatory
approvals. There’s a lot to do – but our basic business must be our
top priority.
Our integration
transition team will be led by Todd Wells. Verizon is also dedicating resources
to this transition. Our two teams share an objective: A seamless
transition for customers and employees.
After we cross the
finish line in the next 9-12 months, we will roll out our Frontier go-to-market
operating model. By investing in and improving the mix and quality of
services currently offered to Verizon’s customers, and building upon our strong
reputation for customer focus and service delivery, we believe we can
significantly increase our revenues and profitability. We believe the
Verizon operations we are acquiring, which include 1.0 million High-Speed
customers and 2.2 million long-distance customers, provide ample opportunity for
growth, especially in customer retention, broadband penetration and market share
of high-value bundles.
We
expect this to be a smooth transition for Verizon customers since Verizon is
spinning these 14 states into a separate stand-alone entity that will be
operationally independent of Verizon. This entity will include a
separate Information Technology Data Center that will support the Verizon
systems and third-party IT systems. This structure eliminates our
need to immediately convert most of the billing and IT
systems. Instead, we can manage change with the customer at the
center of our decisions. As opportunities to maximize operational
efficiencies arise, we will take advantage of them as well.
Over the coming
months, we will be introducing ourselves to our new employees, customers and to
the new communities we will serve. I know they will all respond
positively to our local manager model and investment strategy that puts decision
making closer to the customer and provides competitive products to the markets
we serve.
Until the
transaction closes, we will remain separate companies and will continue to
operate independently. When you have the opportunity to meet your new
colleagues, I know you will make them feel welcome. You may know many
of them already, since most of the properties were once owned by GTE, and we
have acquired many GTE properties over the years.
This is a tremendous day for our
company and for every employee committed to a New Frontier. This
acquisition is an extremely positive and important step for our
existing
customers, for the communities we serve, and for our employees and
shareholders.
As
we continue integration planning, more information will be shared with all of
you. In the interim, if you have any questions or concerns, please do
not hesitate to ask your supervisor or a member of our Human Resources
team. We will add a site link on the home page of the
Link for Frequently Asked acquisition Questions.
Thank you for all
you do to make our Company a success. Our collective achievements
have made today’s announcement possible, and I want to express my gratitude to
our Board of Directors and to the management team for their hard work on this
acquisition. Let’s stay focused on:
|
|
Keeping
existing customers
|
|
■
|
Bringing on
new customers and WIN BACKS, and
|
|
■
|
Selling
innovative products and bundles.
|
This
is The
New Frontier!
Sincerely,
Maggie
Maggie
Wilderotter
Chairman and
CEO
Frontier Communications
3
High Ridge Park
Stamford, CT
06905
maggie.wilderotter@frontiercorp.com
203-614-5099
203-614-4627-Fax
I
can help you!
Forward-Looking
Language
This communication
contains forward-looking statements that are made pursuant to the safe harbor
provisions of The Private Securities Litigation Reform Act of
1995. These statements speak only as of the date of this
communication and are made on the basis of management’s views and assumptions
regarding future events and business performance. Words such as
“believe,” “anticipate,” “expect” and similar expressions are intended to
identify forward-looking statements. Forward-looking statements
(including oral representations) involve risks and uncertainties that may cause
actual results to differ materially from any future results, performance or
achievements expressed or implied by such statements. These risks and
uncertainties are based on a number of factors, including but not limited to:
reductions in the number of our access lines and high-speed internet
subscribers; the effects of competition from cable, wireless and other wireline
carriers (through voice over internet protocol (VOIP) or otherwise); reductions
in switched access revenues as a result of regulation, competition and/or
technology substitutions; the effects of greater than anticipated competition
requiring new pricing, marketing strategies or new product offerings and the
risk that we will not respond on a timely or profitable basis; the effects of
changes in both general and local economic conditions on the markets we serve,
which can impact demand for our products and services, customer purchasing
decisions, collectibility of revenue and required levels of capital expenditures
related to new construction of residences and businesses; our ability to
effectively manage service quality; our ability to successfully introduce new
product offerings, including our ability to offer bundled service packages on
terms that are both profitable to us and attractive to our customers; our
ability to sell enhanced and data services in order to offset ongoing declines
in revenue from local services, switched access services and subsidies; changes
in accounting policies or practices adopted voluntarily or as required by
generally accepted accounting principles or regulators; the effects of ongoing
changes in the regulation of the communications industry as a result of federal
and state legislation and regulation, including potential changes in state rate
of return limitations on our earnings, access charges and subsidy payments, and
regulatory network upgrade and reliability requirements; our ability to
effectively manage our operations, operating expenses and capital expenditures,
to pay dividends and to reduce or refinance our debt; adverse changes in the
credit markets and/or in the ratings given to our debt securities by nationally
accredited ratings organizations, which could limit or restrict the availability
and/or increase the cost of financing; the effects of bankruptcies and home
foreclosures, which could result in increased bad debts; the effects of
technological changes and competition on our capital expenditures and product
and service offerings, including the lack of assurance that our ongoing network
improvements will be sufficient to meet or exceed the capabilities and quality
of competing networks; the effects of increased medical, retiree and pension
expenses and related funding requirements; changes in income tax rates, tax
laws, regulations or rulings, and/or federal or state tax assessments; further
declines in the value of our pension plan assets, which could require us to make
contributions to the pension plan beginning in 2010, at the earliest; the
effects of state regulatory cash management policies on our ability to transfer
cash among our subsidiaries and to the parent company; our ability to
successfully renegotiate union contracts expiring in 2009 and thereafter; our
ability to pay a $1.00 per common share dividend annually, which may be affected
by our cash flow from operations, amount of capital expenditures, debt service
requirements, cash paid for income taxes (which will increase in 2009) and our
liquidity; the effects of significantly increased cash taxes in 2009 and
thereafter; the effects of any unfavorable outcome with respect to any of our
current or future legal, governmental, or regulatory proceedings, audits or
disputes; the possible impact of adverse changes in political or other external
factors over which we have no control; and the effects of hurricanes, ice storms
or other severe weather. These and other uncertainties related to our
business are described in greater detail in our filings with the Securities and
Exchange Commission (SEC), including our reports on Forms 10-K and
10-Q. There also can be no assurance that the proposed transaction
will in fact be consummated. We undertake no obligation to publicly
update or revise any forward-looking statement or to make any other
forward-looking statements, whether as a result of new information, future
events or otherwise unless required to do so by securities
laws.
Additional
Information and Where to Find it
This
communication is not a substitute for the prospectus/proxy statement Frontier
will file with the SEC. We urge investors to read the
prospectus/proxy statement, which will contain important information, including
detailed risk factors, when it becomes available. The
prospectus/proxy statement and other documents which will be filed by Frontier
with the SEC will be available free of charge at the SEC’s website, www.sec.gov, or by directing a
request when such a filing is made
to Frontier, 3 High Ridge
Park, Stamford, CT 06905-1390, Attention: Investor
Relations.
This communication
shall not constitute an offer to sell or the solicitation of an offer to buy
securities, nor shall there be any sale of securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of such
jurisdiction.
Frontier and
certain of its directors, executive officers and other members of management and
employees may, under SEC rules, be deemed to be “participants” in the
solicitation of proxies in connection with the proposed
transactions. Information about the directors and executive officers
of Frontier is set forth in the proxy statement for Frontier’s 2009 annual
meeting of stockholders filed with the SEC on April 6,
2009.
4