Thursday, May 17, 2007

Alltel to be Acquired by TPG Capital and GS for $27 Billion

Alltel, which is the fifth largest wireless carrier in the US serving 12 million customers, agreed to be acquired by TPG Capital and GS Capital Partners (Goldman Sachs), in a transaction valued at approximately $27.5 billion. The purchase price per share represents a 23% premium over Alltel's closing share price prior to media reports of a potential transaction published on December 29, 2006.

The deal represents the largest privatization of a publicly-traded telecommunications firm to date.

Alltel is an all-wireless carrier headquartered in Little Rock, Arkansas with operations in 35 states, including many Tier 2/3 markets. It operates a CDMA network and a GSM network (through its 2005 acquisition of Western Wireless). It maintains roaming partnerships with the four national wireless carriers, including Cingular, T-Mobile, Sprint and Verizon. Alltel has been expanding its CDMA EV-DO network and, as of year-end 2006, approximately 50% of cell sites had been upgraded. The Alltel network also includes 9,300 fiber optic route miles connecting to approximately 100 POPs in key regional locations.

TPG Capital is the global buyout group of TPG (formerly Texas Pacific Group), a leading private investment firm founded in 1992, with more than $30 billion of assets under management.

GS Capital Partners is the private equity vehicle through which The Goldman Sachs Group, Inc., conducts its privately negotiated corporate equity investment activities.

  • In July 2006, Alltel completed the spin off its wireline business, which was merged with VALOR Communications Group to create Windstream, a major wireline operator focused on the rural U.S. market. Windstream serves approximately 3.4 million access lines and offers voice, broadband and digital TV services in 16 states.

  • In 2005, ALLTEL purchased Western Wireless Corporation in a stock-and-cash transaction valued at approximately $6 billion. ALLTEL gained about 1.4 million domestic wireless customers (GSM) in 19 western and midwestern states that are contiguous to existing properties.

See also