U S West, Global Crossings, Frontier combo to create powerhouse

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Denver--Global Crossings Ltd. and U S West have agreed to merge, creating a company that would become a formidable rival to companies like AT&T Corp. and MCI WorldCom. The new company, which will be called Global Crossings Corp., plans to create a seamless end-to-end local-to-global broadband network, provide integrated telecommunications and data services and accelerate deployment of high-speed Internet services to local, national and global markets. Global Crossings, an independent fiber-optic network operator, already plans to buy local and long-distance telephone company Frontier Corp. Frontier has consented to the merger with U S West, which also owns personal communications services properties. The three companies had combined 1998 sales in excess of $15 billion and have a pro forma market capitalization of more than $75 billion. The new company will be 50% owned by Global Crossing/Frontier shareholders and 50% owned by U S West shareholders. The new company will establish two separate tracking stocks. As part of the transaction, U S West will make a cash tender offer for about 39 million Global Crossing shares at a price of $62.75 per share.
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