SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
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|_| Definitive Proxy Statement
|_| Definitive Additional Materials
|X| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
QUANTA SERVICES, INC.
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(Name of Registrant as Specified In Its Charter)
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EXPLANATORY NOTE
Quanta Services, Inc., a Delaware corporation ("Quanta
Services"), is filing the materials contained in this Schedule 14A with the
Securities and Exchange Commission on February 25, 2002 in connection with the
solicitation of proxies for electing the board of directors of Quanta Services
at the 2002 annual meeting of Quanta Services' stockholders.
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[QUANTA SERVICES, INC. LOGO] PRESS RELEASE
FOR IMMEDIATE RELEASE
Contacts:
James Haddox, CFO Jim Barron Ken Dennard / kdennard@easterly.com
Reba Reid Jonas Leddington Lisa Elliott / lisae@easterly.com
Quanta Services, Inc. Citigate Sard Verbinnen Easterly Investor Relations
713-629-7600 212-687-8080 713-529-6600
QUANTA SENDS LETTER TO STOCKHOLDERS
HOUSTON - FEBRUARY 25, 2002 - Quanta Services, Inc. (NYSE:PWR), a
leading provider of specialized contracting services to the electric power, gas,
telecommunications and cable television industries, sent a letter today to its
stockholders setting out why it believes stockholders should resist UtiliCorp
United Inc.'s (NYSE:UCU) hostile proxy contest.
The text of the letter follows:
Dear Quanta stockholder:
As you may already know, UtiliCorp United Inc. - Quanta's largest
stockholder - has announced that it intends to try to take control of
Quanta in a proxy contest at Quanta's 2002 annual stockholder meeting.
WE URGE YOU: DON'T LET UTILICORP STEAL YOUR COMPANY
With this proxy contest, we believe UtiliCorp is trying to steal control of
Quanta without offering you and our other stockholders appropriate benefits
or protections. Furthermore, UtiliCorp has said that, if its directors are
elected, they will "promote business objectives, goals, and values that are
reflective of those of UtiliCorp."(1) In short, UtiliCorp has PROMISED YOU
NOTHING of real value in return for taking control of a company that YOU
OWN.
WHY IS UTILICORP ATTEMPTING TO TAKE CONTROL OF QUANTA?
Simply put, WITHOUT OFFERING YOU ANYTHING, UtiliCorp is trying to achieve
its own self-serving accounting and financial agenda. UtiliCorp has
provided guidance to Wall Street that its earnings will grow 10% in 2002
and THEY HAVE ADMITTED (2) that about half of that growth target is
dependent on their ability to include Quanta's earnings as their own. If
UtiliCorp can't take control
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1 Amendment No. 20 to UtiliCorp's Schedule 13D filing regarding Quanta dated
February 8, 2002.
2 UtiliCorp chief financial officer Daniel J. Streek during UtiliCorp's
February 7, 2002 Fourth Quarter 2001 Earnings Conference Call.
of Quanta, we believe UtiliCorp will most likely fail to achieve the
earnings expectations they have given Wall Street.
While taking control of Quanta to achieve this accounting gimmickry would
help UtiliCorp, WE BELIEVE IT WOULD DISADVANTAGE YOU AND EVERY OTHER QUANTA
STOCKHOLDER. REMEMBER, OUR STOCKHOLDERS EXCLUDING UTILICORP OWN SHARES
REPRESENTING MORE THAN 60% OF THE VOTING POWER OF QUANTA.
DO YOU REALLY THINK YOU CAN TRUST UTILICORP'S HANDPICKED DIRECTORS TO LOOK
OUT FOR YOUR BEST INTERESTS?
o Six of UtiliCorp's nine proposed nominees are current executives of
UtiliCorp or an entity it controls. All six are currently on
UtiliCorp's payroll.
o Two of the nine - including UtiliCorp's president and CEO - are already
designated by UtiliCorp to Quanta's Board. Another of the nominees is a
partner in a law firm that does work for UtiliCorp.
o Seven of the proposed nominees don't own any Quanta stock.
o Two of the nominees were named defendants along with UtiliCorp in a
shareholder lawsuit involving a company that UtiliCorp recently took
public and then repurchased at a lower price.
WHOSE INTERESTS DO YOU THINK UTILICORP'S NOMINEES ARE OUT TO SERVE?
REPLACING THE CURRENT BOARD COULD SIGNIFICANTLY
DAMAGE QUANTA'S BUSINESS
Some of Quanta's existing board members and many of our senior management
came to Quanta when we acquired their companies, and they are still
responsible for the day-to-day operations of those businesses within
Quanta. In fact, two of these board members are responsible for a total of
almost $700 million, or approximately 34.7%, of Quanta's 2001 revenue. By
contrast, the members of the UtiliCorp slate as a group have virtually no
operating experience in our business. It's also worth considering that our
"strategic" relationship with UtiliCorp accounted for less than two percent
of Quanta's revenues in 2001. Furthermore, if UtiliCorp takes control of
Quanta, our relationships with over 50 major utility companies, some of
whom compete with UtiliCorp, would be jeopardized. These customers
collectively accounted for about $835 million, or 40 percent, of Quanta's
2001 revenue. There are no assurances that these customers would stay if
UtiliCorp steals control of the Company.
We ask: DO YOU REALLY THINK IT IS IN YOUR BEST INTERESTS TO VOTE OUT OUR
CURRENT DIRECTORS WHO ARE UNAFFILIATED WITH UTILICORP? DO YOU WANT TO GIVE
CONTROL OF YOUR COMPANY TO UTILICORP'S HANDPICKED NOMINEES WHO WOULD BE
PLEDGED TO "PROMOTE" UTILICORP'S OBJECTIVES?
QUANTA'S PERFORMANCE IS STRONG
While the economic environment has been challenging, Quanta's operating
performance has generally surpassed that of its competitors over the last
two years, and Quanta recently reported record cash flow in the fourth
quarter of 2001. We believe Quanta is well positioned to perform strongly
as the economy recovers. Consider the following:
2
"Quality 4Q results and improving balance sheet strengthen management's
case for independence in the imminent proxy fight with UtiliCorp."
- Evan Smith, Sanders Morris Harris Equity Research
Report, February 14, 2002 (3)
"We think current management is best suited to run Quanta and believe
Stockholders should support them in the upcoming proxy battle [with
UtiliCorp.]"
- Carl Palitti, Gerard Klauer Mattison Equity
Research Report, February 15, 2002 (3)
"We like [Quanta] management's focus on 1) cash generation 2) gross margin
improvement/stabilization, 3) better productivity."
- Chris Gutek, Morgan Stanley Equity Research
Report, February 15, 2002 (3)
YOUR BOARD INTENDS TO FIGHT FOR YOUR RIGHTS
Members of your Board who are unaffiliated with UtiliCorp and members of
our management, all of whom have substantial personal investments in
Quanta, are aligned with the interests of the broader group of
stockholders. They are committed first and foremost to building stockholder
value and, to that end, regularly evaluate all of Quanta's alternatives.
One key point is clear to us: allowing UtiliCorp to take control of your
company - WITHOUT OFFERING YOU APPROPRIATE BENEFITS OR PROTECTIONS IN
RETURN - is NOT in your best interests and will place UtiliCorp in a
position to pursue its own particular agenda at your expense.
In due course, we will set a date for our annual stockholder meeting and
send out our proxy materials seeking your vote. These materials contain
important information for you to consider. In the meantime, if you have any
questions about this process, you can call us or MacKenzie Partners, Inc.,
our proxy solicitor, toll free at 800-322-2885.
Our goal in the coming months is to continue Quanta's good performance and
to get out the vote against UtiliCorp. DON'T LET UTILICORP STRONG ARM
QUANTA OR YOU TO ACHIEVE UTILICORP'S OWN ACCOUNTING GIMMICKRY. We hope that
we will be able to count on your support.
Very truly yours,
By: /s/ Vincent D. Foster By: /s/ John R. Colson
Vincent D. Foster John R. Colson
Chairman Chief Executive Officer
Quanta Services, Inc. is a leading provider of specialized contracting
services, delivering end-to-end network solutions for electric power, gas,
telecommunications and cable television industries. The company's comprehensive
services include designing, installing, repairing and maintaining network
infrastructure nationwide.
Important Information
Quanta Services, Inc. plans to file a proxy statement with the Securities and
Exchange Commission relating to Quanta's solicitation of proxies from its
stockholders with respect to the Quanta Services, Inc. 2002 annual meeting of
stockholders. QUANTA SERVICES, INC. ADVISES SECURITY HOLDERS TO READ ITS PROXY
STATEMENT WHEN IT BECOMES
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3 Consent of author or publication for inclusion in proxy solicitation
materials was neither sought nor obtained.
3
AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Quanta's proxy
statement and other relevant documents will be available for free at
www.sec.gov. You may also obtain a free copy of Quanta's proxy statement, when
it becomes available, by writing to Quanta Services, Inc. at 1360 Post Oak
Boulevard, Suite 2100, Houston, Texas 77056 or by contacting MacKenzie Partners,
Inc., toll free at 1-800-322-2885. Detailed information regarding the names,
affiliation and interests of individuals who may be deemed participants in the
solicitation of proxies of Quanta's stockholders is available in the soliciting
materials on Schedule 14A filed by Quanta with the SEC.
This press release contains various forward-looking statements and information,
including management's expectations of the impact of new branding and marketing
initiatives. Although the company believes that the expectations reflected in
such forward-looking statements are reasonable; it can give no assurance that
such expectations will prove to have been correct. Such statements are subject
to certain risks, uncertainties and assumptions including, among other matters,
future growth in the electric utility and telecommunications outsourcing
industry, and the ability of Quanta to complete acquisitions and to effectively
integrate the operations of acquired companies, as well as general risks related
to the industries in which Quanta operates. Should one or more of these risks
materialize, or should underlying assumptions prove incorrect, actual results
may vary materially from those expected. For a discussion of the risks,
investors are urged to refer to the Company's reports filed under the Securities
Exchange Act of 1934.
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