Alltel Completes Spinoff and Merger of Its Wireline Business with VALOR Communications; Transaction positions company to move f
July 17 2006 - 11:51AM
Business Wire
Alltel (NYSE: AT) today announced that it has completed the spinoff
of its wireline business and the merger of that business into VALOR
Communications Group Inc. The common stock of Windstream Corp., the
new wireline company created by the merger, begins trading July 18,
2006, on the New York Stock Exchange under the symbol WIN. "This
spin-merge transaction is the best course for everyone involved -
the shareholders, customers and employees of both companies - as it
repositions the company into two distinct assets and enhances the
overall opportunities for both businesses," said Scott Ford, Alltel
president and CEO. "It demonstrates our continued commitment to be
faithful stewards of our shareholders' investment by creating
greater value for them while revitalizing opportunities to meet the
distinct needs of both wireless and wireline customers." As
previously disclosed, Alltel has authorized a $3 billion
share-repurchase program expiring Dec. 31, 2008, and the company
will implement a $1 billion debt-reduction program now that the
spin is completed. In addition, Alltel's wireless business expects
to pay an annual dividend of 50 cents per share of common stock.
Under the terms of the previously announced transaction, Alltel
shareholders are entitled to receive 1.0339267 shares of VALOR
stock for each share of Alltel they own. VALOR Communications,
which has been renamed Windstream Corp., issued approximately 403
million shares of common stock pro rata to the shareholders of
Alltel, who will continue to own 1 share of the remaining wireless
entity. Any Alltel shareholder entitled to receive a fractional
share will instead receive a cash payment. No action is required by
Alltel shareholders to receive their VALOR common stock. The
spinoff and merger is tax-free to Alltel and its shareholders,
except in respect of cash received in lieu of fractional shares.
Alltel's wireless network covers more of the U.S. than any other
carrier, covering a population of 77 million with its 850 MHz
business. Alltel offers features that put customers first,
including the exclusive My Circle calling plan that empowers
customers to choose the 10 numbers they call for free - on any
network, anywhere in the U.S. Alltel also is the largest
independent roaming partner to the nation's top four wireless
carriers. "With America's largest wireless network, Alltel is
well-positioned to take advantage of the strong existing
relationships we have built with our customers while our financial
strength allows us to continue investing in the appropriate
technologies for the future," Ford said. "Our company now is
structured to focus all our energies on delivering advanced
wireless voice and data services, backed by our commitment to
superior customer service." Alltel is owner and operator of the
nation's largest wireless network and has more than 10 million
wireless customers. Alltel claims the protection of the safe-harbor
for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are
subject to uncertainties that could cause actual future events and
results to differ materially from those expressed in the
forward-looking statements. These forward-looking statements are
based on estimates, projections, beliefs, and assumptions and are
not guarantees of future events and results. Actual future events
and results may differ materially from those expressed in these
forward-looking statements as a result of a number of important
factors. Representative examples of these factors include (without
limitation) adverse changes in economic conditions in the markets
served by Alltel; the extent, timing, and overall effects of
competition in the communications business; material changes in the
communications industry generally that could adversely affect
vendor relationships with equipment and network suppliers and
customer relationships with wholesale customers; changes in
communications technology; the risks associated with pending
acquisitions and dispositions, including the pending acquisition of
Midwest Wireless; the risks associated with the integration of
acquired businesses; adverse changes in the terms and conditions of
the wireless roaming agreements of Alltel; the potential for
adverse changes in the ratings given to Alltel's debt securities by
nationally accredited ratings organizations; the uncertainties
related to Alltel's strategic investments; the effects of
litigation; and the effects of federal and state legislation,
rules, and regulations governing the communications industry. In
addition to these factors, actual future performance, outcomes, and
results may differ materially because of more general factors
including (without limitation) general industry and market
conditions and growth rates, economic conditions, and governmental
and public policy changes. Alltel, NYSE: AT www.alltel.com
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