Sprint and US Unwired today announced that their boards of directors have unanimously approved an agreement for Sprint to acquire US Unwired for approximately $1.3 billion.
Under the terms of the agreement, Sprint will commence a cash tender offer to acquire all of US Unwired's outstanding common stock at a price of $6.25 per share. Following completion of the tender offer, any remaining shares of US Unwired will be acquired in a cash merger at the same price. Sprint also will acquire US Unwired's net debt, which was approximately $266 million as of March 31, 2005, in connection with the transaction. Shareholders with approximately 27.3% of the outstanding common shares of US Unwired have agreed to tender their shares pursuant to the tender offer and to vote their shares in favor of the merger. The acquisition is subject to customary regulatory approvals and is expected to be completed in the third quarter of 2005.
As part of the agreement, Sprint and US Unwired will seek an immediate stay of litigation pending in U.S. District Court in Lake Charles, La., including US Unwired's request for an injunction to block the merger of Sprint and Nextel Communications, with a final resolution to become effective upon the closing of the acquisition.
US Unwired, based in Lake Charles, La., provides Sprint PCS services in nine states, serving more than 500,000 direct wireless subscribers in 48 markets. It employs about 600 people and had 2004 revenues of $408 million.
"This acquisition would bring an end to a long partnership with the management and shareholders of US Unwired," said Gary Forsee, chairman and CEO, Sprint. "We appreciate their efforts over the years to grow the Sprint business in its assigned territories. While we decided to acquire a direct ownership interest in these assets, we continue to value our relationship with other affiliates providing Sprint services."
Robert Piper, US Unwired's president and CEO, said: "Since US Unwired's inception, our employees have demonstrated their commitment to building substantial shareholder value. We began our Sprint relationship with a handful of customers and a service territory of 1.8 million residents. Through the effort of our personnel, our network now covers 8.1 million people and serves more than a half-million subscribers. We are pleased to have this opportunity to realize continued value for our shareholders."
