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Frontier cools to Qwest
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June 18, 1999: 7:27 a.m. ET
Long-distance carrier won't act on bid, preferring Global Crossing's
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NEW YORK (CNNfn) - Long-distance telephone provider Frontier Corporation is taking no action on Qwest Communications International Inc.'s $13.6 billion unsolicited takeover bid, preferring instead a $10.8 billion offer from Global Crossing.
Frontier's board said late Thursday it will continue to monitor the offer from Denver-based Qwest (QWST), a provider of Internet-based voice and data communications.
But Rochester, N.Y.-based Frontier (FRO) made it clear it is leaning toward last month's $10.8 billion offer from Bermuda-based Global Crossing (GBLX), a Qwest competitor.
"The current circumstances surrounding the Qwest proposal do not warrant any change at this time in our current initiatives that are designed to move Frontier's transaction with Global Crossing toward a prompt closing," Frontier chief executive Joseph P. Clayton said.
In taking no action on the Qwset offer, the Frontier board said it was concerned about uncertainties surrounding Qwest's simultaneous bid for Baby Bell US West (USW), the financial terms and structure of the Qwest proposal, current market conditions, and the terms of the existing Frontier-Global Crossing Ltd. merger agreement.
Qwest Communications's Frontier bid, made June 14, included a $42 billion bid for US West Inc. Global Crossing, meanwhile is also interested in US West, offering $37 billion for the Denver-based long-distance provider last month.
"We remain excited about the strategic and financial benefits of the Global Crossing transaction, including the value certainty it delivers to our shareholders," Clayton said. "We will, of course, continue to monitor events and, where appropriate, respond in our shareholders' best interests."
Global Crossing said it was pleased with Frontier's response. Meanwhile, Qwest found a bright side to the news, saying it was glad Frontier will continue monitoring the offer -- which Qwest said it has no intention of changing.
Frontier shares fell 1/8 to 57-3/4 Thursday. Global Crossing stock gained 9/16 to 48-13/16. Qwest shares rose 1/ 4 to 36.
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Frontier
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