Filed by Valor Communications Group, Inc.
Pursuant to Rule 425 Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Valor Communications Group, Inc.
Subject Companys Commission File No: 1-32422
December 9, 2005
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To:
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VALOR Telecom and Kerrville Telephone Company Employees |
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From:
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Jack Mueller, President and Chief Executive Officer |
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Re:
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VALOR Communications Group (VALOR) Announces Merger with Alltel Wireline Business |
In keeping with our business strategy to pursue selective transactions to grow the company and
increase shareholder value, today we have announced that VALORs Board of Directors has approved a
merger between VALOR and Alltels Wireline Business (AWB). AWB will be spun off from Alltel to
create a separate communications company, which will merge with VALOR. The combination of
businesses will create the leading rural focused wireline company in the United States, with 3.4
million access lines in 16 states and combined revenues of $3.4 billion.
We believe the VALOR-AWB transaction creates significant value for our shareholders. Once the
transaction is approved by various federal and state regulatory agencies and VALOR shareholders,
the new company (NewCo) will be publicly traded and headquartered in the Central Arkansas area. We
expect the transaction to close in mid-2006.
NewCo Benefits
NewCo will create value for our shareholders and for our customers due to complementary geographic
footprints with favorable rural characteristics. Our customers will also benefit from NewCo
synergies, expanded resources and new product offerings. We expect the integration to be seamless
to our customers since the companies share similar processes and Alltel already manages and runs
VALORs billing system.
Workforce
We know that the primary concern with todays announcement relates to your personal standing.
Change can be unsettling and brings many unknowns, which we understand. What we know today is that
workforce changes and new opportunities are possible over time. For the near term, we will be
working in a normal business mode.
Eventually, NewCo will begin evaluating staffing needs and a joint company transition process will
be developed. A steering committee with employee representatives from both companies will also
provide guidance. Most importantly, we commit to ensuring that any workforce changes are conducted
with dignity, respect and ample notification to ease personal transitions.
Furthermore, NewCos executive management team will be comprised of Alltel and VALOR executives and
will be led by Chief Executive Officer Jeff Gardner. You will hear from Jeff today through video
broadcast (details will be forwarded this afternoon) and employee meetings will be scheduled in the
next few months.
-more-
We also commit to keeping you informed throughout the transition process. To this end, attached is
a document with frequently asked questions that will allow you to understand todays announcement
in greater detail. Local management will be meeting with you later this morning to address your
questions.
Please understand that we may not have all the answers you are requesting at this time, but we will
keep you posted as we learn more details. I also encourage you to forward any questions or
concerns to me at Dear Jack.
Next Steps
Todays announcement marks another important milestone in VALORs history and is a testament to
your personal contributions to the business and outstanding efforts with customers and our
operations. Until the transaction closes next year, we will be working in a business-as-usual
mode. This means that your full cooperation and continued performance will be essential to
customer retention and satisfaction, meeting revenue and budget targets and maintaining high
performance metrics.
With your full cooperation, we will continue our strong track record, which has made VALOR Telecom
a successful business enterprise, and will make NewCo a great organization that delivers value to
our shareholders and quality service to our customers.
Jack Mueller