Nacchio’s tenure at Qwest over five years
January 1997: Joe Nacchio joins Qwest as chief executive after being hired away from AT&T by Qwest founder Philip Anschutz.
June 1997: Qwest goes public, selling a 14-percent stake to investors for $297 million, valuing the company at $2.1 billion.
1997-1999: While continuing to build out Qwest’s national fiber-optic network, Nacchio goes on a buying binge that gets the company into related businesses such as long-distance phone and Internet services. The acquisitions include SuperNet, LCI International, EUNet International, Phoenix Network Inc. and Icon CMT. Nacchio also expands into Europe by forming KPN Qwest, a joint venture with Royal KPN NV.
July 1999: Qwest outmaneuvers telecom pipeline firm Global Crossing to merge with Denver-based Baby Bell US West.
June 30, 2000: The two companies finalize a $50 billion merger .
Sept. 7, 2000: Nacchio announces 11,000 job cuts at the company.
October 2000: Accounting firm Arthur Andersen reports that Qwest’s treatment of fiber-optic capacity sales poses a key risk. Its says the SEC is “vigorously challenging the sales treatment,” under which revenue and cash flow are logged up front instead of spread over the life of the deals as other firms do.
March 2001: Qwest chief financial officer Robert Woodruff suddenly announces his retirement from Qwest before a successor is chosen. Robin Szeliga later takes his place at CFO.
June 20, 2001: Morgan Stanley Dean Witter issues a research report on Qwest, raising questions about its financial health. Nacchio blasts the report as ill-informed. Separately, Qwest discloses it will take a $3.1 billion charge for the decline in value of its stake in KPNQwest.
Aug. 2, 2001: Szeliga issues a confidential memo to eight Qwest executives explaining the company’s new stricter requirements for cutting capacity swap deals and logging revenue from them.
October 2001: Arthur Anderson issues another warning, saying the capacity sales are “maximum risk.”
March 11, 2002: Qwest says the SEC has opened an “informal” inquiry into its accounting practices, its sale of equipment to customers from which it bought Internet services or provided financing, and the changes in production schedules at QwestDex.
June 2002: New auditor KPMG begins an inquiry resulting in Qwest announcing it will erase at least $1 billion to $1.5 billion in improperly logged revenue from its books.
June 14, 2002: Anschutz boards a plane for New Jersey, where Nacchio lives, to inform him of the board’s decision to replace him.
June 17, 2002: Former Ameritech CEO Richard Notebaert takes over as CEO and chairman of Qwest. Anschutz steps down as chairman but remains on the board.
