CHICAGO, Nov. 29, 2011 /PRNewswire/ -- Telephone and
Data Systems, Inc. (NYSE: TDS, TDS.S) today announced that its
Board of Directors has unanimously approved certain changes to the
previously proposed amendments to the TDS certificate of
incorporation. As previously proposed, the amendments
included a share consolidation amendment to reclassify each Special
Common Share as one Common Share. As revised, each Special
Common Share would still be reclassified as one Common Share, and
each Common Share would now be reclassified as 1.087 Common Shares
and each Series A Common Share would now be reclassified as 1.087
Series A Common Shares.
The primary purpose of the changes is to recognize the fact that
the Common Shares have generally traded at a premium to the Special
Common Shares since the creation of the Special Common Shares in
2005. Based on discussions with the holders of both the Common
Shares and Special Common Shares, the TDS Board of Directors
decided to change the proposal to include a Common Share
Reclassification Ratio of 1.087. The Board believes this ratio best
reflects the long-term relative trading ratio of the Common Shares
versus the Special Common Shares. The Series A Common Shares, which
can be converted into Common Shares at any time, will also be
reclassified at a ratio of 1.087 Series A Common Shares for each
Series A Common Share.
Each Special Common Share would be reclassified into one Common
Share, as originally proposed. Reclassifying Special Common
Shares as Common Shares on a one-for-one basis would permit the
holders of Special Common Shares to continue to receive the same
aggregate quarterly dividend that they currently receive, based on
the current per share dividend rate, subject to declaration by the
TDS Board of Directors.
The TDS Board of Directors believes that the revised share
consolidation amendment is in the best interests of all TDS
shareowners. It will simplify TDS' capital structure, improve
market liquidity, and provide greater financial flexibility.
The Common Shares are currently listed on the New York Stock
Exchange ("NYSE") under the symbol "TDS" and the Special Common
Shares are currently listed on the NYSE under the symbol
"TDS.S". If the share consolidation is approved and becomes
effective, the Special Common Shares will cease to be outstanding
and cease to trade and will be reclassified into Common Shares,
which will continue to trade on the NYSE under the symbol
"TDS".
In addition, certain non-substantive changes would be made to
the vote amendment in connection with the change in the
reclassification ratios.
Shareholder Approvals
As previously disclosed, in addition to required statutory
votes, the share consolidation and vote amendments will be subject
to the approval of a majority of the unaffiliated holders of Common
Shares and Special Common Shares, each voting separately as a class
at a special meeting of shareholders. For purposes of this vote,
unaffiliated holders will not include the TDS Voting Trust, members
of the Carlson family that are TDS shareholders, or directors or
executive officers of TDS. Accordingly, the proposed
transactions will require substantial support from unaffiliated
public shareholders to be approved.
The trustees of the TDS Voting Trust have indicated that they
support the proposed transactions.
Board Recommendation
The TDS Board of Directors, including all independent members,
has unanimously approved the revised proposals, and believes the
adoption of such proposals is in the best interests of TDS and all
of its shareholders, and unanimously recommends that shareholders
vote "FOR" such proposals.
Timing and Process
The TDS Board of Directors has also directed that the proposed
transactions be submitted to TDS shareholders for consideration at
an Adjourned Special Meeting of shareholders scheduled for
January 13, 2012. The record date of
the Adjourned Special Meeting has been changed to be more current
and will be the close of business on December 9, 2011.
TDS is filing a proxy supplement with the Securities and
Exchange Commission ("SEC") in connection with the revised
proposal, which will be sent to shareholders shortly after the
revised record date. Additional information is included in the
proxy supplement.
The proposed transactions are expected to take place shortly
after the Adjourned Special Meeting, subject to TDS shareholder
approval and certain other conditions. The transactions are
intended to be tax free to TDS and its shareholders.
Citigroup Global Markets Inc. ("Citi") is acting as financial
advisor to TDS in connection with the foregoing proposals.
In addition, Credit Suisse is acting as financial advisor to the
independent directors on the TDS Board in connection with the
foregoing proposals.
IMPORTANT INFORMATION: The foregoing information is not a
solicitation of a proxy from any TDS shareholder. This is
being done only pursuant to a definitive proxy statement, as
supplemented. Additional information relating to the
foregoing is included in TDS' proxy materials filed with the
Securities and Exchange Commission ("SEC") and distributed to
shareholders. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO
READ SUCH MATERIALS BECAUSE THEY CONTAIN IMPORTANT INFORMATION.
Shareholders and other investors may access such materials without
charge at the SEC's web site (www.sec.gov) and on the TDS web site
(www.teldta.com) in the Investor Relations section on the SEC
filings page. In addition, shareholders may obtain free copies of
the proxy materials by contacting TDS' information agent, MacKenzie
Partners at (800) 322-2885. TDS and its executive officers
and directors may be deemed to be participants in the solicitation
of proxies from TDS shareholders on behalf of the TDS Board of
Directors in connection with the foregoing. Information
concerning such participants and their respective direct or
indirect interests in TDS by security holdings or otherwise is
included in TDS' proxy materials.
About TDS
Telephone and Data Systems, Inc. (TDS), a Fortune 500® company,
provides wireless, local and long-distance telephone and broadband
services to approximately 7 million customers in 36 states through
its business units, U.S. Cellular (wireless) and TDS Telecom
(wireline). Founded in 1969 and headquartered in Chicago, TDS employed 12,300 people as of
September 30, 2011.
Visit www.teldta.com for comprehensive financial information,
including earnings releases, quarterly and annual filings,
shareholder information and more.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995: All information set forth in this news
release, except historical and factual information, represents
forward-looking statements. This includes all statements about the
company's plans, beliefs, estimates and expectations. These
statements are based on current estimates, projections and
assumptions, which involve certain risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements. Important factors that may affect these
forward-looking statements include, but are not limited to: the
ability of the company to successfully grow its markets; the
overall economy; competition; the access to and pricing of
unbundled network elements; the ability to obtain or maintain
roaming arrangements with other carriers; the state and federal
telecommunications regulatory environment; the value of assets and
investments; adverse changes in the ratings afforded TDS and U.S.
Cellular debt securities by accredited ratings organizations;
industry consolidation; advances in telecommunications technology;
uncertainty of access to the capital markets; pending and future
litigation; changes in income tax rates, laws, regulations or
rulings; acquisitions/divestitures of properties and/or licenses;
and changes in customer growth rates, average monthly revenue per
unit, churn rates, roaming revenue and terms, the availability of
handset devices, or the mix of products and services offered by
U.S. Cellular and TDS Telecom. Investors are encouraged to consider
these and other risks and uncertainties that are discussed in the
Form 8-K used by TDS to furnish this press release to the SEC,
which are incorporated by reference herein.
For more information about TDS and its subsidiaries, visit:
TDS: www.teldta.com
U.S. Cellular: www.uscellular.com
TDS Telecom: www.tdstelecom.com
SOURCE Telephone and Data Systems, Inc.