Windstream Completes $2.3 Billion Merger with Paetec

by Luke Jones  on Thursday, Dec. 1, 2011 8:48 am  

Windstream Corp. of Little Rock on Thursday said it had completed its $2.3 billion acquisition of Paetec Holding Corp. of Fairport, N.Y.

"The addition of Paetec strengthens Windstream in important ways," Windstream's president and CEO Jeff Gardner said in a news release. "Paetec brings tremendous enterprise-level expertise and product offerings to enhance our already robust business division.

"Its customer-focused culture dovetails with Windstream's commitment to superior service. And its exclusive fiber network and complementary markets make Windstream a formidable nationwide communications and technology solutions provider."

With Paetec, Windstream will command a fiber network of around 100,000 miles.

Paetec's shareholders received 0.46 shares of Windstream per each Paetec share owned at closing. Windstream issued about 73.4 million shares of its stock, valued at about $863 million. The Little Rock telecom is shouldering Paetec's $1.4 billion net debt.

Windstream expects to spend about $100 million on smoothing employee and service overlap, $50 million on merger and integration costs and $55 million on capital expenditures over the first three years of the merger.

The transaction also includes tax assets of an estimated $250 million value.

The merger was announced in August and continued despite the questionable future of a Paetec building project in Rochester, N.Y. Windstream later announced it would continue the Rochester project.

 

 

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