DJN PRESS RELEASE:Andersen Grp Files Form 8K On Moscow Invest
Feb 1 2000 22:38
( BW)(NY-ANDERSEN-GROUP) Andersen Group Files 8K
Business Editors
NEW YORK--(BUSINESS WIRE)--Feb. 1, 2000--Andersen Group (ANDR),
a US-based holding company, announced today, that it is filing
an 8-K form with the United States Securities and Exchange Commission
relating to its participation with an investor group and Moscow
Telecommunications Corporation (COMCOR).
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 Date of Report February 1, 2000 ANDERSEN
GROUP, INC. (Exact name of registrant as specified in its charter)
DELAWARE 0-1460 (State or other jurisdiction Commission File Number
06-0659863 IRS Employer incorporation Identification No. 515 Madison
Avenue, New York, NY 10022 (Address of principal executive offices)
(Zip code) (212) 826-8942 (Registrant's telephone number, including
area code) Item 2. Acquisition or Disposition of Assets.
On January 25, 2000, the Board of Directors of Andersen Group,
Inc. (the 'Company') voted unanimously to invest up to $4 million
in a private placement of Treglos Investments Limited ('Treglos'),
a company formed in Cyprus in which the Company had an existing Page 2
50% equity interest prior to the private placement. Prior to the
private placement this equity interest and a $500,000 receivable
from Treglos had a net recorded value of approximately $84,000.
At that time, the primary asset of Treglos was a 6% equity interest
in the Institute of Automated Systems ('IAS'), a Moscow, Russia-based
telecommunications company.
On February 1, 2000, the Company invested a total of $3 million
in cash and converted the $500,000 accounts receivable from Treglos
into additional shares of Treglos.
As a result of the Treglos private placement, the Company now
directly owns approximately 23% of the outstanding shares of Treglos,
but has voting control of Treglos until February 1, 2001 by virtue
of irrevocable proxies signed by substantially all the investors
of Treglos.
Oliver R. Grace, Jr. and John S. Grace, both of whom are directors
of the Company, each had a direct or indirect ownership interest
in Treglos of approximately 22% prior to the private placement.
They each indirectly made additional investments in Treglos through
the private placement. In addition, Board members Francis E. Baker,
James J. Pinto, Louis A. Lubrano and Peter N. Bennett also directly
or indirectly invested in the Treglos private placement, as did
Andrew M. O'Shea, the Company's Chief Financial Officer.
Concurrent with the private placement of its shares, Treglos entered into a general agreement with Moskovskaya Telecommunikatsionnaya
Corporatsiya ('COMCOR'), a Moscow-based telecommunications company,
to operate ZAO COMCOR-TV ('COMCOR-TV'). COMCOR-TV will provide
a wide range of telecommunications services, including cable television,
high speed internet access, and IP telephony to individual subscribers
and businesses throughout the Moscow region. COMCOR-TV is fully
licensed and authorized to provide cable TV, Internet and other
broadband services for approximately 1.5 million of the 3.4 million
homes in Moscow. It also has exclusive access for twenty years
to an extensive fiber-optic transportation network known as the
Moscow Fiber Optic Network ('MFON'), which is owned and operated
by COMCOR. The MFON has approximately 3,000km (1,800 miles) of
fiber optic cable and provision for more than 192 primary nodes.
Currently, COMCOR-TV's service can be made available to approximately
42,000 homes. Plans call for making COMCOR-TV's service available
to an additional 42,000 homes in the next twelve months, and 165,000
more homes in the following twelve months.
Under the terms of the general agreement, Treglos' portion
of the initial capitalization of COMCOR-TV includes its shares
of IAS and $9 million in cash, with COMCOR contributing licenses
and shares of IAS. Treglos and COMCOR are each committed to make
future equity contributions totaling approximately $46 million
if certain operating performance measures are met. Such contributions may be made in the form of cash, operating equipment or additional
shares of IAS, as specified in the general agreement. The Company
is not committed to make additional investments into Treglos or
COMCOR-TV. If the Company does not make additional investments
in Treglos, its investment in Treglos would be diluted. Under
the terms of the agreement, Treglos and COMCOR are equal shareholders
in COMCOR-TV.
To create the liquidity required to make this investment, the
Company sold substantially all of its portfolio of common stocks
of domestic savings banks. Forward-Looking Statement This report
contains forward-looking statements which reflect management's
current expectations, assumptions and estimates of future performance
and economic conditions. Such statements are made in reliance
upon the safe harbor provisions of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of
1934. The Company cautions investors that any forward-looking
statements are subject to risks and uncertainties which may cause
actual results and future trends to differ materially from those
matters expressed in or implied by such forward-looking statements.
Such statements contain a number of risks and uncertainties, including,
but not limited to: (i) regulatory changes in the Russian Federation
that may affect the cable and telecommunications industries; (ii)
changes in economic and political conditions in Russia that could adversely affect the level of demand for cable and telecommunications
services; (iii) higher than anticipated start-up costs associated
with new business opportunities; (iv) higher than anticipated
employee levels, capital expenditures, and operating expenses;
(v) consumer acceptance of broadband services, including telephony
and data services; (vi) increases in fraudulent activity with
respect to broadband services; or (vii) delays in the development
of anticipated technologies, or the failure of such technologies
to perform according to expectations. About Andersen Group
Andersen Group is a US-based diversified holding company which
operates in two main business areas: electronics and investments.
Andersen Group has historically made investments in companies
that operate in various segments of the market, including manufacturing
and supply of electronic, ultrasonic and video equipment, cellular
communications, medical products and services.
--30--jh/ny*
CONTACT: Andersen Group
Andrew O'Shea
Phone: 860/286-6128
KEYWORD: NEW YORK
INDUSTRY KEYWORD: CABLE INTERNET TELECOMMUNICATIONS BANKING
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