SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant |X|
Filed by a party other than the Registrant |_|
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|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as Permitted by Rule
14a-6(e)(2))
|_| 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] 1360 Post Oak Boulevard
Suite 2100
Houston, TX 77056-3023
Telephone: (713) 629-7600
Fax: (713) 629-7676
NYSE: PWR
February 25, 2002
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
ADMITTED2 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 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.
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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.
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:
"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)
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3 Consent of author or publication for inclusion in proxy solicitation materials
was neither sought nor obtained.
"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
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| If you have any questions, please contact: |
| |
| MACKENZIE PARTNERS, INC. |
| 105 Madison Avenue |
| New York, New York 10016 |
| proxy@mackenziepartners.com |
| (800) 322-2885 (TOLL FREE) |
| (212) 929-5500 (call collect) |
| |
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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 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 letter contains various forward-looking statements and information,
including management's expectations regarding the future performance of Quanta.
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, its customers and its suppliers operate.
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, as amended.