Atlantic Tele-Network sells Alltel to AT&T
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ATN makes $557 million profit in three years on selling rural wireless operations to AT&T
AT&T is to buy US regional mobile carrier Alltel for $780 million, giving the company an extra 585,000 customers in rural areas of six states, Georgia, North Carolina, South Carolina, Illinois, Ohio and Idaho.
The deal is a good one for Atlantic Tele-Network, the holding company that is selling the operations to AT&T. Only three years ago ATN bought the units from Verizon Wireless for $223 million.
The businesses generated revenues for the first nine months of 2012 of about $350 million, says ATN, which owns a long-distance network in the US plus operations in Guyana, Bermuda, US Virgin Islands and the Turks & Caicos.
Michael Prior, CEO of ATN, said: “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.”
Prior said that the money it receives from the sale may be used for further acquisitions. “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,” he said.
Verizon Wireless bought most of Alltel in 2008 for $28 billion, but as a condition of the deal had to sell the business in 105 markets. AT&T bought 79 of those, with 1.5 million customers, in 2009 and ATN bought the rest in 2010.