Alltel sale could fetch $30 billion
http://money.cnn.com/2007/02/20/news/companies/allte ... »
The top rural U.S. wireless provider fueled merger speculation during its earnings call Tuesday.
February 20 2007: 9:56 PM EST
NEW YORK/PHILADELPHIA (Reuters) -- Alltel Corp. could fetch a price tag of $25 billion to $31 billion from private equity firms or other U.S. mobile service providers looking to expand in rural markets, analysts said Tuesday.
Alltel, the top rural U.S. wireless provider, fueled merger speculation when it said during an earnings conference call Tuesday that it was reviewing its strategic options. Analysts said a sale agreement could happen as early as April.
Its shares rose 3.3 percent to $62.40 after the comment...
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The top rural U.S. wireless provider fueled merger speculation during its earnings call Tuesday.
February 20 2007: 9:56 PM EST
NEW YORK/PHILADELPHIA (Reuters) -- Alltel Corp. could fetch a price tag of $25 billion to $31 billion from private equity firms or other U.S. mobile service providers looking to expand in rural markets, analysts said Tuesday.
Alltel, the top rural U.S. wireless provider, fueled merger speculation when it said during an earnings conference call Tuesday that it was reviewing its strategic options. Analysts said a sale agreement could happen as early as April.
Its shares rose 3.3 percent to $62.40 after the comment...
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More info!
Executives at Alltel also said on a call with analysts that its board had met to review options that could involve anything from "balance sheet restructuring to strategic alternatives to operational opportunities."
"Alltel confirmed that it is in the process of evaluating strategic options, with everything including the kitchen sink possible and a resolution possible by May," Barclays Capital analysts Hale Holden and Robert Arnold wrote in a report. Bear Stearns analysts, meanwhile, have assigned an equal probability to three different scenarios: Alltel does a recapitalization but remains investment grade, or it is bought by a strategic buyer, or it is bought by a financial buyer.
"Private equity buyers have had little experien...
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Executives at Alltel also said on a call with analysts that its board had met to review options that could involve anything from "balance sheet restructuring to strategic alternatives to operational opportunities."
"Alltel confirmed that it is in the process of evaluating strategic options, with everything including the kitchen sink possible and a resolution possible by May," Barclays Capital analysts Hale Holden and Robert Arnold wrote in a report. Bear Stearns analysts, meanwhile, have assigned an equal probability to three different scenarios: Alltel does a recapitalization but remains investment grade, or it is bought by a strategic buyer, or it is bought by a financial buyer.
"Private equity buyers have had little experien...
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so looking at all this it seems why alltel is doing great now they forsee problems or there are prolbmes already that haven't made any impact yet and they are trying to fix it or sell and be done with it!
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Fascintating, I wonder what's going on? Verizon would be the logical buyer, but are they really in the market? It would put them back on top, theoretically.
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I can't quite decide whether this would be a good thing or a bad thing. Verizon gets so many bad raps for its UIs and customer service that I am not sure I want them as my carrier. On the other hand, it would be nice to have a larger carrier in some instances.
On top of that, would Verizon continue to invest in rural and low density cell systems? Or would we simply become poor returns on investment? I can't help but wonder if Alltel is successful in a large part by being aggressive in areas that the other carriers largely ignore. I know in my area, I have only one carrier, Alltel. The other could be here and have been at times but have all pulled out.
But things change, maybe a new owner would be a good thing.
On top of that, would Verizon continue to invest in rural and low density cell systems? Or would we simply become poor returns on investment? I can't help but wonder if Alltel is successful in a large part by being aggressive in areas that the other carriers largely ignore. I know in my area, I have only one carrier, Alltel. The other could be here and have been at times but have all pulled out.
But things change, maybe a new owner would be a good thing.
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I personally think that they could do more damage by combining with other regional carriers like USCC and or Pioneer or others until they are a national carrier like the big boys. I don't like the way Alltel does their billing, or their attitude when you call in for help, but that's neither here nor there. I'm just wondering what they are up to buy putting their business kinda on the block when it isn't certain that anyone is interested in buying.
Sprint hasn't recovered from the Nextel buyout and Verizon doesn't seem to be shopping, so I wonder what they are up to.
Sprint hasn't recovered from the Nextel buyout and Verizon doesn't seem to be shopping, so I wonder what they are up to.
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One note to understand. Pure speculation!
Comcast.
Comcast has been reviewing wireless options for years. They really want there own spectrum and not being a MVNO.
Comcast.
Comcast has been reviewing wireless options for years. They really want there own spectrum and not being a MVNO.
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The proposal of any deal is in play. The Alltel board is voting on a proposed deal.
The question is who and when is the announcement.
In addition, Alltel must finish the share buy back program (3 billion repurchase of common stock) before any announcement can be made.
The question is who and when is the announcement.
In addition, Alltel must finish the share buy back program (3 billion repurchase of common stock) before any announcement can be made.
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Don't count sprint out just because of the merger with nextel. Verizon would need approval since they only own 50% of verizon wireless. Sprint may be turned off by most of alltel is 800mgh but I don't see that a huge problem. Investors look at the big picture and sprint is in a good position and if they can do what they say in the next two years they will be sprinting to the top. EVDO/Wimax/Qchat/VOIP calls. Wow can't wait to see what happens!
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Actually, VZW and Cingular like 800 mhz......it is coveted because you can't get it anymore but by buying out other carriers.
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Alltel has both a CDMA network (over all of their coverage area) & a GSM network (primarily in areas where there is no other GSM carrier, for roaming purposes only). So for those areas, Cingular would just shutoff the CDMA portion of the network. With Verizon, in the areas that Alltel & Verizon overlap, they most likely would have to divest in North & South Dakota. Michigan would have to be divested in areas where the 2 carriers overlap, as far as cellular licenses. Wisconsin would be a safe bet for both carriers since I believe 1/2 of Cingular's network in that state is PCS only, while all of Verizon's network, except for 2 areas near Minnesota is PCS. But either carrier acquiring Alltel would be forced to divest some areas, but Cingul...
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the most logical choice would be sprint but I don't thinkthey are in the position to do it! They wouldn't have to divest much if any at all. They already did with the nextel merger giving up all of their landlines to embark. They are strictly wireless now. well they do have some business landlines but no resdential.
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Right now. There is now indication of who exactly it is. It literally could be anyone from private equity to vodafone.
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exactly. However I feel if verizon was they would just say they are bidding they have nothing to hide and they have the money to do so. But they would face many obstacles from the FCC. Sprint may want to and is looking into seeing if they can and have investors into it. If it isn't a wireless carrier they will not be sold. Investors like to get lots of money out of something with little money going into it. Wireless requires heavy money into to be spent.
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