Alltel Buys Western Wireless for $4.2 Bln

Alltel Corp. (NYSE:AT - news), the leading rural
telephone company, on Monday said it would buy rural mobile
operator Western Wireless Corp. (Nasdaq:WWCA - news) for about $4.15
billion in cash and stock to boost its competitive position in
the rapidly consolidating U.S. wireless industry.

The deal follows Cingular Wireless' (NYSE:SBC - news)(NYSE:BLS - news) recent
$41 billion purchase of AT&T Wireless and Sprint Corp.'s
(NYSE:FON - news) agreement to acquire Nextel Communications Inc.
(Nasdaq:NXTL - news) for almost $35 billion.

 

Little Rock, Arkansas-based Alltel would be the No. 5 U.S.
wireless service provider after the current spate of
consolidation, with a network covering about a quarter of the
country's population and half its geographic area.

 

"It's a great combination that's going to help them compete
in a rapidly changing landscape with bigger players." said Roe
Equity Research analyst Kevin Roe, who noted that rural
operators have long been expected to consolidate.

 

The deal, including about $1 billion in cash, values
Western Wireless of Bellevue, Washington, at $38.38 per share
based on Alltel's share price in afternoon trade. The agreed
price represents a premium of about 7.5 percent over Western
Wireless' close on Friday.