Otelco announces 3 million IDS shares/notes offering

By Paul A. Harris

St. Louis, May 3 - Otelco Inc. plans to offer 3 million of income deposit securities (IDS), according to a prospectus filed Thursday with the Securities and Exchange Commission.

The securities will be comprised of 3 million shares of class A common stock and $22.5 million of 13% senior subordinated notes due 2019.

CIBC World Markets, UBS Investment Bank and Raymond James are the underwriters.

Proceeds will be used to pay down the company's term loan, which matures on July 3, 2011.

Holders may separate the shares and notes at any time.

Otelco is an Oneonta, Ala.-based traditional wireline telephone services provider in several rural communities in Alabama, Maine and Missouri.

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