Louisiana-based communications heavyweight CenturyTel Inc. is doing its best to join the ranks of corporate giants such as Verizon Communications Inc. and AT&T Inc. by announcing a $10.6 billion takeover of the telecom giant Qwest Communications.
The all-stock deal values Qwest at $6.02 per share, a 15 percent premium over Wednesday’s closing price. CenturyTel would also assume almost $12 billion in debt. Shares of Qwest increased 2.5 percent to $5.37 on the New York Stock Exchange on Thursday.
CenturyTel will now encompass all of Qwest’s clients and businesses. The $10.6 billion dollar buyout is much like AT&T’s takeover of Cingular and Verizon’s buyout of Alltell.
The company has grown rapidly in recent years. A few months ago, CenturyTel completed its acquisition of Embarq Corp., which spun off Sprint Corp. last year.
“This combination will enhance our ability to deploy innovative IP products and high-bandwidth services to business customers, expand broadband availability and speed to consumers, and offer superior, differentiated, video products,” Glen F. Post, CenturyTel’s CEO, said in a statement on Thursday.
The deal immediately doubles CenturyTel’s customer base. The new CenturyTel mega structure will include 17 million landline customers, 5 million broadband accounts, and 850,000 wireless accounts, according to the New York Times. CenturyTel took advantage of Qwest’s recent dilemma with debt after the company was unable to hold its ground in the communication market that is dominated by AT&T and Verizon.
Government regulations exist in the United States to prevent companies from becoming monopolies, but this doesn’t stop them from growing dramatically. AT&T was broken up in the 80s only to come back and become a new force.
The all-stock deal values Qwest at $6.02 per share, a 15 percent premium over Wednesday’s closing price. CenturyTel would also assume almost $12 billion in debt. Shares of Qwest increased 2.5 percent to $5.37 on the New York Stock Exchange on Thursday.
CenturyTel will now encompass all of Qwest’s clients and businesses. The $10.6 billion dollar buyout is much like AT&T’s takeover of Cingular and Verizon’s buyout of Alltell.
The company has grown rapidly in recent years. A few months ago, CenturyTel completed its acquisition of Embarq Corp., which spun off Sprint Corp. last year.
“This combination will enhance our ability to deploy innovative IP products and high-bandwidth services to business customers, expand broadband availability and speed to consumers, and offer superior, differentiated, video products,” Glen F. Post, CenturyTel’s CEO, said in a statement on Thursday.
The deal immediately doubles CenturyTel’s customer base. The new CenturyTel mega structure will include 17 million landline customers, 5 million broadband accounts, and 850,000 wireless accounts, according to the New York Times. CenturyTel took advantage of Qwest’s recent dilemma with debt after the company was unable to hold its ground in the communication market that is dominated by AT&T and Verizon.
Government regulations exist in the United States to prevent companies from becoming monopolies, but this doesn’t stop them from growing dramatically. AT&T was broken up in the 80s only to come back and become a new force.
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