In a letter to employees today, Trujillo said he would resign his position in order to smooth the transition into the new company.
"We are now at a critical point in the merger," Trujillo wrote. "Even though we have agreed on a wide range of issues, we have not found agreement on key strategic issues."
"When the merger of US West and Qwest closes later this year, I will be stepping down from my leadership position," Trujillo added. "I will not be joining the new Qwest."
Trujillo's departure is emblematic of the difficulties in joining an old-guard "Baby Bell" local telephone firm with one of the new breed of fast-moving, unregulated fiber-optics players. Following the announcement of Qwest's purchase of US West, that company's stock plummeted, as the market tried to figure out how the two could work together.
The stock has largely recovered as Wall Street has seen benefits in joining US West's local network and high-speed Internet business with Qwest's long-distance fiber-optic networks, however. US West shares have gone up consistently since the merger announcement.
Trujillo had been instrumental in turning US West from the smallest local phone network into a company focused considerably more on high-speed Internet access and innovative technology such as video over phone lines.
He will not go out empty-handed. According to statements filed with the Securities and Exchange Commission, he will have immediate access to $17.5 million in previously unvested stock after the mergers. He will leave 3 million options in the new company on the table, however.
Trujillo had been slated to take a "co-chairman" role in the new company, a power-sharing arrangement that many analysts had said would likely be untenable.
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