Rural Cellular shareholders approve Verizon buyout

By Devika Patel

Knoxville, Tenn., Oct. 4 - Rural Cellular Corp. announced that its shareholders approved its proposed acquisition by Verizon Wireless. Verizon will acquire Rural Cellular for approximately $2.67 billion in cash and assumed debt. The merger agreement was announced July 30.

"Today's election reflects a decisive vote by our shareholders to merge with Verizon. The merger represents a tremendous opportunity for our rural service areas to benefit from Verizon's scale and cutting-edge technology," Rural Cellular's president and chief executive officer Richard Ekstrand said in a press release.

Based on the preliminary tally, holders of 88% of Rural Cellular's eligible class A common stock, class B common stock and class M preferred stock voted in favor of the agreement at the special meeting.

As previously reported, the transaction, slated to close in the first half of 2008, will increase Verizon Wireless' customer base by more than 700,000. In addition, Verizon said it could realize more than $1 billion in synergies in reduced roaming and operations expenses.

When the merger is completed, Rural Cellular's common stock holders will be entitled to receive $45 per share in cash, for a total equity price of $757 million on a fully diluted basis.

Verizon Wireless is a wireless voice and data network based in Basking Ridge, N.J.

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

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