Canada's Teleglobe Buys Excel
Jun. 15, 1998
DALLAS (AP) _ Excel Communications Inc. agreed to be acquired for $3 billion by Teleglobe Inc. of Montreal in a deal that would create the fourth-largest U.S. long-distance telephone company.
Excel, of Dallas, currently ranks fifth among long-distance phone companies in the United States. Teleglobe is a large provider of international phone service in Canada.
The new company will keep the Teleglobe name and its Montreal headquarters. Teleglobe chairman and chief executive Charles Sirois will keep those titles at the combined company, which will have 4,000 employees, 6 million home and 65,000 business customers.
Excel shareholders will receive 0.885 of a Teleglobe share, or roughly $23 per share after Teleglobe completes its two-for-one stock split on Monday. Excel shares closed at $27.56 on Friday and were down 18 percent, or $4.87 1/2 to $22.68 3/4, in afternoon trading on the New York Stock Exchange.
The merger should boost Teleglobe's profits as soon as it closes, expected by the end of the year, Teleglobe officials said.
The merger has been approved by the boards of both companies as well as investors holding a majority of outstanding stock. The merger needs approval by regulators in both the U.S. and Canada.