Rural Cellular acquired by Verizon Wireless for $2.66 billion

By Lisa Kerner

Charlotte, N.C., Aug. 7 - Verizon Wireless completed its purchase of Rural Cellular Corp. for $2.66 billion in cash and assumed debt, it was announced on Thursday.

Under the terms of the acquisition, Verizon Wireless paid $45 in cash for each share of Rural Cellular's common stock for a total common equity price of approximately $764 million on a fully diluted basis, a Verizon Wireless news release stated.

The companies agreed to combine in July 2007.

Verizon Wireless said with the acquisition it expects to increase its licensed coverage area by 4.7 million people, adding licenses covering markets in Maine, New Hampshire, Massachusetts, Alabama, Mississippi, Minnesota, North Dakota, South Dakota, Wisconsin, Idaho, Washington and Oregon.

Rural Cellular will continue to use the Unicel brand for the next several months, the release noted.

Verizon Wireless added that it is selling Rural Cellular licenses and assets in Vermont, New York and parts of Washington as required by the Department of Justice and the Federal Communications Commission.

In addition, Rural Cellular's markets in southern Minnesota and western Kansas are expected to be divested as a result of the regulatory approval process for Verizon Wireless' proposed purchase of Alltel Corp.

Verizon Wireless, a Basking Ridge, N.J., wireless voice and data network operator, expects to realize about $1 billion in synergies in reduced roaming and operations expenses.

Rural Cellular, located in Alexandria, Minn., provides wireless communication services under the Unicel brand.

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