Monday Feb 06 2012
SureWest sold to Consolidated Communications
By: ToLewis, The Press Tribune
After serving the region for nearly a century, Roseville’s SureWest Communications has been sold. Illinois-based Consolidated Communications Holdings, Inc. (Nasdaq: CNSL) announced Monday that it has entered into a definitive agreement to acquire SureWest. The cash and stock merger is valued at $23 per share, or approximately $340.9 million, according to a statement released by Consolidated Communications. SureWest started out as Roseville’s telephone company in 1914 and began offering internet in the 1980s, according to company spokesman Ron Rogers. SureWest ventured into the cable television market in the early 2000s, Rogers said. The company employs 600 people in the Sacramento area and another 200 in its Kansas City market, providing approximately 282,000 connections. According to Laura ZuHone, director of corporate communications for Consolidated, the company has not come to a decision as to whether or not any current employees will lose their jobs. “Management and overall staffing will be assessed according to business and customer needs, as the two companies (are) being operating as one,” ZuHone said. “Our top priority is taking care of our customers.” Founded in 1894, Consolidated Communications offers a wide range of services over its IP-based network, including local and long distance telephone, digital phone, high-speed internet access and digital TV. It currently operates in a mix of suburban areas and rural territories in Central Illinois, Texas and Western Pennsylvania, and it will now take over SureWest’s Sacramento and Kansas City markets. ZuHone said that Consolidated Communications will operate in the six states as one company, but no decisions have yet been made on branding, meaning the name SureWest may or may not change. Rogers said it is customers who will benefit the most from the deal. “It’s going to be a bigger company that can provide more enhanced services and additional programming,” he said. “Combining with this company allows us to have better financial resources.” Rogers said the deal will likely take six to nine months to close, awaiting approvals from federal and California regulators. “During that timeframe, all day to day functions and activities will remain the same,” he said. “Expectations going forward are that Consolidated wants to continue growing the company.” ZuHone said under the terms of the agreement, SureWest’s shareholders may elect to exchange each share of SureWest common stock for either $23 in cash or shares of Consolidated common stock having equivalent value. Rogers said that when the stock market closed on Friday, the last day of trading, SureWest stock was selling for $15.59 per share. Once the deal was announced Monday morning, the stock jumped up to $22.12 per share, he said. Rogers said that pensions of retired SureWest employees will not be affected, since the pensions were frozen a few years ago and are under government protection. Toby Lewis can be reached at email@example.com. Follow him on Twitter @TobyLewis_RsvPT.