MONROE, La. and DENVER, Co. – April 22, 2010 – CenturyLink (CenturyTel, Inc., NYSE: CTL) and Qwest Communications (NYSE: Q) announced today that their boards of directors have approved a definitive agreement under which CenturyLink will acquire Qwest
CenturyLink to Become National, Industry-Leading Communications Company with Pro Forma 2009 Revenues of $19.8 Billion
Combined Company to Have Extensive Broadband Capabilities with 173,000-mile Fiber Network
Compelling Choice for Consumer, Business and Wholesale Customers Offering Full Array of Communications Services
Transaction Expected to be Accretive to Free Cash Flow per Share, Excluding Integration Costs, Immediately Following Close of the Transaction
MONROE, La. and DENVER, Co. – April 22, 2010 – CenturyLink (CenturyTel, Inc., NYSE: CTL) and Qwest Communications (NYSE: Q) announced today that their boards of directors have approved a definitive agreement under which CenturyLink will acquire Qwest in a tax-free, stock-for-stock transaction. Under the terms of the agreement, Qwest shareholders will receive 0.1664 CenturyLink shares for each share of Qwest common stock they own at closing. Upon closing of the transaction, CenturyLink shareholders are expected to own approximately 50.5 percent and Qwest shareholders are expected to own approximately 49.5 percent of the combined company.
Based on the closing stock price of CenturyLink on April 21, 2010, the per share consideration to be received by Qwest shareholders would be equivalent to $6.02 of CenturyLink stock, which represents a premium to Qwest shareholders of approximately 15 percent over Qwest’s closing stock price on April 21, 2010. Based on the closing stock price of CenturyLink on April 21, 2010, the transaction reflects an enterprise value of Qwest of approximately $22.4 billion, including the assumption of $11.8 billion of Qwest net debt outstanding as of December 31, 2009.
The parties expect the transaction to be accretive to CenturyLink’s free cash flow per share, excluding integration costs, immediately following the close of the transaction. Leveraging CenturyLink’s proven integration experience, the transaction is expected to generate annual operating and capital synergies of approximately $625 million when fully recognized over a three- to five-year period following the close of the transaction.
This combination will result in a company whose enterprise business will be a significant contributor to its growth which, along with the consumer business, will allow it to offer innovative broadband products