Agenda Packets - 1996/09/23 - Laserfiche WebLink

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MEMORANDUM August 9, 1996 Page 8 handled by the same experienced management group that operates the system today." The documentation for the proposed merger does not bear out this assertion. Counsel for US West verbally indicated that Amos Hostetter, the chief shareholder of Continental, will be named President of the cable division of US West Media Group, Inc. (a subsidiary of US West, Inc.), which is not the company which will own the previously Continental cable systems and franchises. In responses to the request for a schematic diagram of the post-merger ownership structure from the franchise holding entities up to US West, Inc., counsel for US West provided a chart eliminating all entities other than the franchise holders, the Merger Subsidiary, and US West, Inc. Even assuming that the personnel directly controlling the cable systems remain in place, there is no a laranty that the corporate philosophy of Continental will survive the merger. Rather, • it is more likely that additional bureaucratic constraints will exist within the US West, Inc. group than existed in Continental. It is no assurance that the individuals who directly interact with commission members will be retained when there is no information on the upper-management strategic plan for use of the cable system. Fourth, industry publications estimate the purchase price of this transaction at $11 billion, with one-half of that figure used to retire existing Continental debt. The merger agreement contains a formula for determining the purchase price based on financial information available at closing and subject to financial adjustments which can be calculated using information known only to the parties. When asked to provide a "ballpark" estimate of the purchase price for this transaction, counsel for US West referred back to the formula contained in the merger agreement.