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Technology Stocks : IDT *(idtc) following this new issue?* -- Ignore unavailable to you. Want to Upgrade?

To: chalu2 who wrote (2791)	3/17/1999 7:18:00 AM
From: Hawaii60	Respond to of 30916

GBLX to buy FRO, we have mega deals for undersea and land fiber with both. (REUTERS) Global Crossing buys Frontier for $11.2 bln stock Global Crossing buys Frontier for $11.2 bln stock (rewrites, adds background and details graf 5, 7-14, adds byline) By Reshma Kapadia NEW YORK, March 17 (Reuters) - Fiber optic provider Global Crossing Ltd. <GBLX.O> said on Wednesday it agreed to buy telephone carrier Frontier Corp. <FRO.N> for $62 a share, or $11.2 billion in stock, giving it a foothold in the U.S. market. The deal puts a 40 percent premium on Rochester, N.Y.-based Frontier's shares, which closed up $2.31 at $44.50 Tuesday on the New York Stock Exchange. Frontier has about 171.61 million shares outstanding. The Bermuda-based telecommunications upstart's marriage to the local and long distance carrier will create a company with total current market value of $30 billion. The deal, which is expected to close in the third quarter, is expected to immediately add to its operating cash flow upon completion. The telecommunications industry has been consolidating in recent months as companies seek out partners in the age of advanced communications networks. Global Crossing Chief Executive Robert Annunziata, who resigned AT&T Corp.<T.N> in late February, will remain at the helm of the new company. Frontier's Chief Executive Joseph Clayton will become a vice chairman. "Merging with Frontier will enable us to greatly accelerate our aggressive growth strategy," Annunziata said in a statement. "These are two complementary companies with no overlap, and together we will be ideally positioned to meet the exploding demand for bandwidth to handle Internet, data, video and voice transmissions, and produce outstanding value for our customers, shareholders and employees," he added in the statement. A Global Crossing spokesman declined to comment at the moment on whether there would be any charges to earnings or job cuts. Based on current market prices, the new company will be two-thirds owned by Global Crossing shareholders. Its stock closed Tuesday down $5.06 at $51.50 on Nasdaq. The combined company will have 71,000 route miles, over one million fiber miles, and offer ultra-high bandwidth to 159 cities in 20 countries. It will also offer global voice, web hosting, private line, ATM and Internet services. In late February, Frontier had said it was exploring a range of options as it restructured, including the spin off its local phone operations and selling the company. In connection with the deal, Frontier as granted Global Crossing an option to buy up to 19.9 percent of its 171.6 million outstanding shares at $62 per share as well as a break-up fee if the merger is terminated for certain reasons. Shareholders of Global Crossing representing more than a majority of the voting power have agreed to vote in favor of the merger. Merrill Lynch & Co., Salomon Smith Barney, Inc. and Chase Securities, Inc. served as financial advisers to Global Crossing, and Morgan Stanley Dean Witter served as financial adviser to Frontier. ((Reshma Kapadia, New York Newsdesk