EXHIBIT 99.2
[QWEST LOGO] [U S WEST LOGO]
[QWEST LOGO] [U S WEST LOGO]
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[QWEST LOGO] [U S WEST LOGO]
July 19, 1999
This presentation contains 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, which identify important risk factors that could cause actual
results to differ from those contained in the forward-looking statements.
These materials include analysts' estimates and other information prepared by
third parties for which the companies assume no responsibility. The companies
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 and U S WEST logos are registered trademarks of Qwest Communications
International Inc. and U S WEST, Inc. in the U.S. and certain other countries.
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Joe Nacchio Sol Trujillo
Chairman Chairman
and President and
Chief Executive Officer Chief Executive Officer
[QWEST LOGO] [U S WEST LOGO]
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[QWEST LOGO] [U S WEST LOGO]
A $65 billion merger forming the
benchmark large-cap growth company
in the communications / Internet sector
for the new millenium
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[QWEST LOGO] Transaction Summary [U S WEST LOGO]
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o Strategic merger
o Combined equity value of $65 billion
o Qwest is offering $69 per share in Qwest common stock within a "collar" range
of $28.26 to $39.90 per Qwest share
o Collar may be satisfied in stock or cash below $38.70
o Transaction value of $36.5 billion at current market prices
o Stock received is tax-free to U S WEST shareholders
o Annual dividend of $0.05 per share
o Expected to close by mid-year 2000
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[QWEST LOGO] The Right Merger [U S WEST LOGO]
at the Right Time
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o Shared Vision
o Highly Complementary Assets
o Vertical Integration
o Accelerated Growth
o Time to Market
o Low-Cost Provider
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[QWEST LOGO] Strategic Rationale [U S WEST LOGO]
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GROWTH
Worldwide broadband [Text at left
end-to-end infrastructure encapsulated in
Expanded products and services Up Arrow Graphic]
Customers
Distribution
Operating systems
People and processes
Integration
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[QWEST LOGO] Creation of a [U S WEST LOGO]
Powerful New Company
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Qwest U S WEST Combined
Revenue (1999E) $3.6B $13.2B $16.8B
EBITDA (1999E) $0.75B $5.8B $6.6B
Customers 4M 25M 29M
Employees 9,000 55,000 64,000
Equity Value $28.5B $36.5B $65.0B
(7/16/99) (deal price)
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[QWEST LOGO] Enhancing the [U S WEST LOGO]
Productivity of Capital
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o Capital redeployment:
2000-2005
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Capital expenditure synergies $2.2B
Dividend redirected 5.3
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Total $7.5B
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o To be re-invested in:
- Internet applications and hosting
- Facility based CLEC
- Out-of-region broadband access, Internet services
- Wireless expansion
- Video entertainment
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[QWEST LOGO] Combined Company [U S WEST LOGO]
Key Financial Metrics
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Graph depicting numerical data presented below
2000 2005 CAGR
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Revenue $18.5B $38-40B 15-17%
EBITDA $ 7.4B $18-19B 20%
This information includes financial projections and other forward-looking
statements that involve risks and uncertainties. These statements may differ
materially from actual future events or results. Neither Qwest nor U S WEST
undertake any obligation to publicly release any revisions to any financial
projections or other forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
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[QWEST LOGO] Network and [U S WEST LOGO]
Distribution Assets
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Qwest U S WEST
Greatest Capacity, Most Advanced Broadband Network in the World
- - 1.3M worldwide fiber miles - 1.7M fiber miles
- - 18,815 route miles in US - 40,400 route miles
- - 1,400 route miles in Mexico - 7,000 Metro fiber rings
- - 8,100 route miles in Europe - 18,000 SONET nodes
- - 400 STM-1s (Europe, Asia Pac) - 13 million covered PCS POPs
(67 Gbps)
Strong Local Markets with Capability to Deliver Worldwide
- - 80 sales offices - 71 sales offices
- - 1,000 sales reps - 5,500 sales reps
- - 12,000 distributors - 1,500 distributors/agents
- - Presence in 14 countries
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Internet / Broadband
Capabilities
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Qwest U S WEST
Largest worldwide IP Backbone, most frame relay switches, largest
worldwide applications service provider
- - 7 Cyber Centers (hosting centers) - 1 hosting center
- - 50,000 OC-48 IP miles - 45 DSL markets
- - 225 IP routers - 5.5M DSL lines passed
- - 130 Frame/ATM switches - 50,000 DSL customers
- - National fixed wireless access - 4,000 VDSL customers
- - Cyber.Solutions - 150 IP routers
- KPMG - 65,000 Frame Relay nodes
- Oracle - 417 Frame switches
- SAP - 93 ATM switches
- Siebel - !NTERPRISE data networking services
- - Partnerships - U S WEST.net Consumer Internet Services
- Microsoft - U S WEST DEX
- HP - InterAct Business Internet Services
- Netscape/AOL
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[QWEST LOGO] National Broadband [U S WEST LOGO]
Expansion to 25 Markets
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Map of the US depicting the following types of expansion into the listed
markets:
18 Announced Metropolitan Networks 7 Fiber Expansion Cities
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Albany, NY Detroit, MI
Austin, TX Kansas City, MO
Baltimore, MD Orange County, CA
Boston, MA Pittsburgh, PA
Chicago, IL St. Louis, MO
Cleveland, OH San Diego, CA
Dallas, TX San Francisco, CA
Houston, TX
Indianapolis, IN
Los Angeles, CA
New York, NY
New York area (2 networks)
Philadelphia, PA
Sacramento, CA
San Antonio, TX
San Jose, CA
Washington, DC
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[QWEST LOGO] Combined Broadband [U S WEST LOGO]
Capabilities
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Map of the US depicting Domestic Fiber Routes throughout the United States as
well as numerous cities with broadband capability equipment as follows:
Austin TX
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Metropolitan Rings, DSL, TERA POP
Boston, MA
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Metropolitan Rings, DSL, Fixed Wireless, TERA POP
Chicago, IL
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Metropolitan Rings, DSL, Fixed Wireless, TERA POP
Dallas, TX
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Metropolitan Rings, DSL, Fixed Wireless, TERA POP
Denver, CO
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CyberCenters, DSL, Fixed Wireless, U S WEST DSL, TERA POP
Houston, TX
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Metropolitan Rings, DSL, Fixed Wireless, TERA POP
Los Angeles, CA
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Metropolitan Rings, DSL, Fixed Wireless, Future Metro Rings, CyberCenters,
TERA POP
Minneapolis, MN
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DSL, Fixed Wireless, U S WEST DSL, TERA POP
Philadelphia, PA
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Metropolitan Rings, DSL, Fixed Wireless, TERA POP
Phoenix, AZ
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VDSL, U S WEST DSL, Fixed Wireless, TERA POP
Portland, OR
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DSL, Fixed Wireless, U S WEST DSL, TERA POP
Sacramento, CA
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Metropolitan Rings, DSL
Salt Lake City, UT
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U S WEST DSL, DSL, TERA POP
San Diego, CA
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DSL, Future Metro Rings, TERA POP
San Francisco, CA
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CyberCenters, DSL, Fixed Wireless, Future Metro Rings, TERA POP
Tampa, FL
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DSL, Fixed Wireless
Washington, DC
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CyberCenters, Metropolitan Rings, DSL, Fixed Wireless
The map depicts the presence of these capabilities in other less urban areas
of the country as well.
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[QWEST LOGO] Worldwide Multimedia [U S WEST LOGO]
Network
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3 Million Fiber Miles Worldwide
[Map of US, Mexico, Japan and Europe and Atlantic and Pacific Oceans
illustrating international Fiber Network of the Combined Company.]
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[QWEST LOGO] Strategic Growth Initiatives [U S WEST LOGO]
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o Accelerate deployment of broadband access, Internet and
hosting services out of region
o Aggressively grow in-region opportunities
- High speed access (xDSL)
- Long distance
- Video / entertainment
- Wireless
- Integrated products and services
o Capitalize on national leadership in Internet-based applications and hosting
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[QWEST LOGO] Revenue Synergy Sources [U S WEST LOGO]
(2000-2005)
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o $12B+ of gross revenue synergies
Pie chart depicting breakdown of source contributions to gross revenue
synergies:
In-Region Long Distance 26%
In-Region Local/Internet/Hosting Services 19%
Out-of-Region CLEC/LD Services 34%
Out-of Region DLEC/Internet/Hosting 21%
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[QWEST LOGO] In-Region: [U S WEST LOGO]
Long Distance [Pie Chart 26%]
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o Rapid market share gain (Post 271)
- Powerful wide area and local product combinations
o Extensive and complementary distribution channels
- U S WEST consumer / small business strength
- Qwest mid market and large account strength
o Low cost position
2002 2005 CAGR
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Revenue Impact $0.3B $1.7B 75%
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[QWEST LOGO] In-Region: [U S WEST LOGO]
Local / Internet / Hosting Services [Pie Chart 19%]
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o Improved retention of In-Region base
o Increased share in consumer and business Internet services
o Extension of Cyber.Solutions hosted applications into small business market
o Additional distribution channels selling packages of services
2002 2005 CAGR
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Revenue Impact $0.2B $0.7B 50%
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[QWEST LOGO] Out-of-Region: [U S WEST LOGO]
CLEC / LD Services [Pie Chart 34%]
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o Aggressively build & operate a CLEC out of region in 20+ markets
o Offer a suite of fiber-based CLEC, LD and Internet services
o Enhance U S WEST systems and Qwest broadband reach
2002 2005 CAGR
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Revenue Impact $0.2B $2.3B 125%
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[QWEST LOGO] Out-of-Region: [U S WEST LOGO]
DLEC / Internet / Hosting [Pie Chart 21%]
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o Aggressively build DSL DLEC facilities in top 25 markets
o Extend integrated bundle to SME market of broadband access, Internet
services, hosting, integration and LD
o Extend In-Region frame relay, private line and Internet networks nationwide
2002 2005 CAGR
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Revenue Impact $0.2B $1.1B 75%
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[QWEST LOGO] Operating Expense Synergies [U S WEST LOGO]
(2000-2005)
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o $4.4B operating expense synergies
Pie Chart depicting breakdown of source contributions to operating expense
synergies:
Sales and Marketing 13%
Corporate 42%
Systems 17%
Network 28%
o Expense synergies represent less than 5% of combined company expenses
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[QWEST LOGO] Capital Synergies [U S WEST LOGO]
(2000-2005)
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o $2.2B+ avoided investments
Pie Chart depicting breakdown of source contributions to capital synergies:
Network 35%
Systems 24%
Platform Development 41%
o Capital synergy dollars will be redeployed to support growth of
combined business
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[QWEST LOGO] Synergy Summary [U S WEST LOGO]
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($ in millions) 2002 2000-2005
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Revenue (EBITDA Impact)* $350-400 $4,000-4,200
Operating Expenses $700-800 $4,300-4,500
Capital $450-500 $2,200-2,300
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Total $1,500-1,700 $10,500-11,000
* $12B+ gross revenue synergies net of related costs.
Reflects additional synergies that have been identified jointly since
announcement of merger proposal
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[QWEST LOGO] Combined Revenue [U S WEST LOGO]
Grows to $38-40B in 2005
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15-17% Total CAGR
Chart depicting growth in revenues by business unit:
2000 2005 CAGR
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IP/Data 17% 44% 40+%
Long Distance 17% 20% 20+%
Other* 26% 17% 5+%
Local 40% 19% 1%
* Directory, wireless, access, wholesale and construction.
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[QWEST LOGO] Combined Company Will Grow [U S WEST LOGO]
Aggressively Nationwide
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Combined Revenue
15-17% Total CAGR
Chart depicting growth in revenue by region:
2000 2005 CAGR
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Out-of-region 25% 60% 29%
In-region 25% 60% 10%
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[QWEST LOGO] [U S WEST LOGO]
[QWEST LOGO] [U S WEST LOGO]
Qwest: The Large Cap Growth
Communications/Internet
Benchmark
for the New Millenium
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[QWEST LOGO] [U S WEST LOGO]
[QWEST LOGO] [U S WEST LOGO]