Windstream Corp., continued its skein of merger and acquisition activity on Thursday announcing the completion of the acquisition of Q-Comm Corporation, a privately held regional fiber transport and competitive local exchange carrier, in a transaction valued at approximately $818 million.
Thursday's acquisition announcement follows Windstream's completion of the acquisition of Hosted Solution in a $310 million deal earlier in the week.
The Q-Comm transaction includes its wholly-owned subsidiaries Kentucky Data Link, Inc., a fiber services provider, and Norlight, Inc., a competitive local exchange services company.
Windstream issued approximately 20.6 million common shares valued at $273 million based on Windstream's closing share price on Dec. 1 of $13.24. The company also paid approximately $279 million in cash as part of the deal. Windstream also repaid approximately $266 million of Q-Comm's total outstanding debt. Windstream financed the deal with cash and proceeds rom a bond offering in October.
Kentucky Data provides long-haul and metropolitan fiber services to a diverse base of bandwidth intensive customers, primarily serving wireline and wireless carriers, as well as the large enterprise, government, education and medical markets. The company's contiguous fiber network spans nearly 30,000 fiber route miles in 23 states and the District of Columbia.
Norlight is a competitive local exchange carrier that serves approximately 5,500 small and medium sized business customers in Indiana, Kentucky, Tennessee and Wisconsin.
Windstream expects to achieve annual operating expense and capital expenditure synergies of approximately $25 million.
This summer, Windstream completed the acquisition of Newton-based Iowa Telecom in a $1.2 billion stock, cash and debt assumption deal. At the end of this month, Windstream plans to complete its integration of Iowa Telecom with the elimination of an additional 146 positions from its Newton location. Early next year, Windstream plans to move back to the former Iowa Telecom headquarters building on South Second Avenue West in downtown Newton. Iowa Telecom had purchased the former Maytag headquarters building after Whirlpool shut the facility down. Local development officials are actively marketing the building.