[November 26, 2009] Windstream to acquire Iowa Telecommunications Services Tweet Nov 26, 2009 (Datamonitor Financial Deals Tracker via COMTEX) -- Windstream Corporation, a provider of telecommunications, internet and digital TV services, has entered into a definitive agreement to acquire Iowa Telecommunications Services, Inc., a telecommunications service provider that offers local telephone, long distance, internet, broadband and network access services, for approximately $1,100 million. Both the companies are based in the US. Under the terms of the agreement, Iowa Telecom shareholders will receive 0.804 shares of Windstream common stock and $7.90 in cash per share of Iowa Telecom common stock. Windstream expects to issue approximately 26.5 million shares of stock valued at approximately $269 million, based on the company's closing stock price on November 23, 2009, and pay approximately $261 million in cash as part of the transaction. Windstream will also repay estimated net debt of approximately $598 million. Windstream intends to finance the cash portion of the transaction and the repayment of Iowa Telecom's outstanding indebtedness with the proceeds from a debt financing or additional bank borrowings. The transaction also includes tax assets with an estimated net present value of approximately $130 million and Iowa Telecom's 15 FCC Advanced Wireless Service licenses and three 700 MHz Band licenses. Stephens, Inc., Goldman, Sachs & Co. and Bank of America Corporation, are acting as financial advisors to Windstream, while Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor. J.P. Morgan Securities, Inc. and Fredrikson & Byron, PA are acting as financial and legal advisors, respectively, to Iowa Telecom. The transaction is expected to close in mid-2010. Deal Value (US$ Million) 1100 Deal Type Acquisition Sub-Category Majority Acquisition Deal Status Announced: 2009-11-23 Deal Participants Target (Company) Iowa Telecommunications Services, Inc. Acquirer (Company) Windstream Corporation Deal Rationale The acquisition will grow Windstream's rural footprint with expansion into Iowa and Minnesota and adds approximately 256,000 access lines, about 95,000 high-speed internet customers and about 26,000 digital TV customers. The transaction is expected to generate annual synergies of approximately $35 million in operating expenses and capital expenditure savings and excluding integration charges. [ Back To TMCnet.com's Homepage ]