March 16, 2000 ? Qwest Communications International Inc. (NYSE: Q), the broadband Internet communications company, today announced the forthcoming sale of its long distance and related business, including certain physical assets, in the 14-state U S WEST territory to Touch America, the telecommunications subsidiary of The Montana Power Co. (NYSE: MTP), for approximately $200 million.
The sale will be completed when Qwest closes its merger with U S WEST, expected later this year. The divestiture is required by federal law to comply with restrictions that currently prohibit regional bell operating companies or their affiliates from providing long distance services in their local service region.
"We are pleased that Touch America is acquiring this business from us," said Joseph P. Nacchio, chairman and CEO of Qwest. "Touch America is an experienced carrier with a national fiber network and the same high commitment to service that our customers are accustomed to receiving from Qwest today."
"This milestone acquisition fits well with our strategy to add customers, sales force and increase revenues on Touch America's rapidly expanding national fiber-optic network," said Robert P. Gannon, Chairman and CEO, Montana Power/Touch America. "The service area is a part of the country we know well, as we have had infrastructure in place for some years that matches much of the service region Qwest is divesting. We look forward to providing our new customers the same superior service that we have been offering others for the past 16 years."
Under terms of the transaction, Qwest will sell Touch America its in-region business, including 1+, and related wholesale and private line services. These services are sold to about 250,000 customers and generate revenues of approximately $300 million annually. In addition, Touch America will purchase certain physical assets and will offer employment to Qwest?s sales agents in the 14-state region. The sale is subject to the receipt of regulatory approvals and other customary closing conditions.
Qwest is not divesting its interLATA business outside the U S WEST region, so customers in those parts of the country are not affected by this transaction. Qwest can reenter the long distance market in the 14 U S WEST states once it has satisfied certain requirements in the Telecommunications Act of 1996.
About Touch America
Touch America is wholly owned telecommunications subsidiary of the Montana Power Company, providing long-distance services, private-line services, Internet, wireless and business telephone equipment since 1983. The company?s fiber-optic network employs the most advanced telecommunications technology available today. Touch America offers a full line of dedicated voice, data and video services and frame relay solutions. Touch America?s equipment services include design, installation and maintenance of PBX and key systems. The company also offers construction management oversight of the installation of fiber-optic systems. Touch America and the Montana Power Company are based in Butte, Montana. Information about Touch America can be found at http://www.mtpower.com or http://www.in-tch.com.
Qwest Communications International Inc. (NYSE: Q) is a leader in reliable, scalable and secure broadband Internet-based data, voice and image communications for businesses and consumers. The Qwest Macro Capacity® Fiber Network, designed with the newest optical networking equipment for speed and efficiency, spans more than 25,500 miles in North America. In addition, KPNQwest (Nasdaq: KQIP), Qwest?s European joint venture with KPN, the Dutch telecommunications company, is building and will operate a high-capacity European fiber optic, Internet-based network that will span 11,800 miles when it is completed in 2001. For more information, please visit the Qwest web site at http://www.qwest.com.
: 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 and U S WEST with the SEC, specifically the most recent reports 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 maintain rights of way, financial risk management and future growth subject to risks, Qwest's ability to achieve Year 2000 compliance and adverse changes in the regulatory or legislative environment. This release may include analysts' estimates and other information prepared by third parties, for which neither Qwest nor U S WEST assumes any responsibility. Qwest and U S WEST undertake no obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
The Qwest logo is a registered trademark of Qwest Communications International Inc. in the U.S. and certain other countries. The U S WEST logo is a registration trademark of U S WEST, Inc. in the U.S.
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