Windstream to Acquire Iowa Telecom

Windstream Corp. has agreed to acquire Iowa Telecommunications Services Inc., based in Newton, Iowa, for $530 million in stock and cash.

Under the terms of the agreement, Iowa Telecom shareholders will receive 0.804 shares of Windstream stock and $7.90 in cash for each share of Iowa Telecom.

Iowa Telecom has approximately 11 access lines per square mile across its service areas and operates an extensive fiber and IP network. Through this acquisition Windstream will expand its footprint in Iowa and Minnesota, gaining approximately 256,000 access lines, 95,000 high-speed Internet customers and 26,000 digital TV customers. The transaction also includes Iowa Telecom’s 15 FCC Advanced Wireless Service (AWS) licenses and three 700 MHz Band licenses.

Iowa Telecom marks the fourth acquisition made by Winstream this year, as the telecom provider has committed $1.3 billion to grow the company through acquiring other smaller-sized service providers.

“Our whole investment thesis was to grow scale in rural America,” said Jeff Gardner, Windstream’s Chief Executive in a recent Wall Street Journal article. “I still think there’s a great deal of consolidation left with smaller players, where the pressure is the most obvious.”

The transaction is expected to close in mid-2010, subject to certain conditions, including necessary approvals from federal and state regulators and Iowa Telecom shareholders.

Windstream offers an interesting map of its recent acquisitions.
The Wall Street Journal has more.

Related posts:

1. Windstream to Acquire Q-Comm, Double Fiber Reach
2. Windstream to Acquire PAETEC
3. Windstream Restructures
4. Windstream Invests in $20M in Fiber Network
5. Iowa Communications Network on the Block