CenturyTel Inc., which has been on a spending spree, has landed its biggest fish to date. The company has struck a deal with Qwest Communications to buy the Denver-based telco for $10.6 billion — $22.4 billion once Qwest debt is accounted for – in an all-stock deal. Qwest is the nation’s third-largest phone company. CenturyTel is No. 5.
Many Qwest-watchers believe a deal like this has been in the making for a long time because the company has had a hard time competing with giants like AT&T and Verizon. Qwest has never able to do much in the wireless arena, stunting its growth as a company. Qwest’s stock was trading close to its 52-week high on Wednesday, but $5.25 per share is far below the numbers it posted in years past.
CenturyTel and Qwest have landline operations in 40 states, so if this deal gets the necessary regulatory approval, it will have a major impact. The pair will reportedly have 18 million phone lines across the country; however, that number is still small compared to Verizon and AT&T. Just last year, CenturyTel bought Embarq Corp., which operated landlines once owned by Sprint.
When the deal closes, if you own Qwest stock, you’ll get 0.1664 shares of CenturyLink – the name given to the combined CenturyTel-Embarq last year – for each Qwest share. CenturyTel shareholders will own slightly more than half of the combined company, which will be headquartered in CenturyTel’s current home base of Monroe, La.
Qwest announced earlier this year that it was planning to leave its downtown Denver headquarters in a move that would save it $12 million per year.
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May 24 2019 @ 15:22:08 UTC