Atlantic Tele-Network Announces Sale of U.S. Retail Wireless Business to AT&T
BEVERLY, Mass.--(BUSINESS WIRE)--
Atlantic Tele-Network, Inc. (NASDAQ: ATNI), a telecommunications service
provider to rural, niche and other under-served markets, today announced
it has agreed to sell its domestic retail wireless business operated
under the Alltel name by ATN's subsidiary Allied Wireless Communications
Corporation ("Allied"). AT&T will purchase the operations in an all-cash
transaction valued at approximately $780 million.
Allied, based in Little Rock, Arkansas, serves approximately 585,000
customers in rural areas of six states — Georgia, North Carolina, South
Carolina, Illinois, Ohio and Idaho, and generated revenues for the first
nine months of 2012 of approximately $350 million. In ATN's public
filings, these operations are consolidated within its U.S. Wireless
segment. These operations generated operating income estimated to be
approximately $34 million, which is net of depreciation and amortization
expense of approximately $42 million, for the first nine months of 2012.
"We are pleased that AT&T recognizes the value of our U.S. wireless
retail operations and is acquiring these assets," said Michael T. Prior,
Chief Executive Officer. "Alltel's customers will benefit from access to
a nationwide 4G network, a larger device selection, additional retail
locations and a broader range of product offerings. Additionally, many
of our employees should benefit from new career opportunities within
AT&T. We will work closely with AT&T to close the transaction and to
ensure a smooth transition for our customers and employees."
Commenting on the use of proceeds once the transaction is completed, Mr.
Prior said, "We have a disciplined, long-term approach to managing our
portfolio and intend to balance the use of the after-tax proceeds among
new acquisition opportunities, a possible reduction in debt outstanding,
investments in our existing lines of business and returns to
shareholders through dividends."
The transaction is subject to customary closing terms and conditions and
regulatory approval from the Department of Justice and the Federal
Communications Commission. The companies expect to complete the
transaction in the second half of 2013.
Following the close of the sale, Atlantic Tele-Network's businesses will
consist of Commnet, serving rural communities primarily in the Southwest
U.S.; Sovernet, serving residential and business customers in New
England; ION, serving rural communities in New York State; GT&T, serving
Guyana; CellOne, serving Bermuda; and Choice, Islandcom and Mio, serving
portions of the Caribbean islands.
Stephens, Inc. is serving as financial advisor to Atlantic Tele-Network
and provided a fairness opinion for the transaction. Cleary Gottlieb
Steen & Hamilton LLP and Jenner & Block are providing legal counsel.
Conference Call Information
Atlantic Tele-Network will host a conference call on Tuesday, January
22, 2013 at 10:00 a.m. Eastern Time (ET) to discuss this announcement.
The call will be hosted by Michael Prior, President and Chief Executive
Officer, and Justin Benincasa, Chief Financial Officer. The dial-in
numbers are US/Canada: 877-734-4582 and International: 678-905-9376,
conference ID 92178318. A replay of the call will be available at
ir.atni.com beginning at 2:00 p.m. (ET) on January 22, 2013.
About Atlantic Tele-Network
Atlantic Tele-Network, Inc. (NASDAQ:ATNI), headquartered in Beverly,
Massachusetts, provides telecommunications services to rural, niche and
other under-served markets and geographies in the United States, Bermuda
and the Caribbean. Through our operating subsidiaries, we provide both
wireless and wireline connectivity to residential and business
customers, including a range of mobile wireless solutions, local
exchange services and broadband internet services and are the owner and
operator of terrestrial and submarine fiber optic transport systems. For
more information, please visit www.atni.com.
Cautionary Language Concerning Forward Looking
This press release contains forward-looking statements regarding the
proposed transaction, including whether the transaction will be
completed and, if so, the expected timetable for any such completion and
the expected uses of proceeds, which constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. There are a number of important factors that could
cause actual results to differ materially from those indicated by such
forward-looking statements, including: (i) the ability to receive the
requisite regulatory consents and approvals to consummate the
transaction; and (ii) the satisfaction of the other conditions to
completion of the transaction and (iii) with respect to the use of
proceeds, at this time, ATN has no specific plans with respect to the
use of proceeds following the completion of this transaction and is
currently evaluating such plans; the timing, manner and extent to which
such proceeds are deployed may be affected by future market conditions,
potential changes in tax laws and ATN's ability to develop corporate
investment and strategic opportunities meeting ATN's criteria. The
information set forth herein speaks only as of the date hereof, and ATN
disclaims any intention or obligation to update any forward-looking
statements as a result of developments occurring after the date of this
Sard Verbinnen & Co.
Justin D. Benincasa, 978-619-1300
Source: Atlantic Tele-Network, Inc.
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