Shares of CenturyLink Inc. and Qwest Communications International Inc. closed higher on Tuesday after stockholders of both companies approved, by more than 97 percent, the operators pending, $22.4 billion merger.
The votes come in addition to recent approvals from the U.S. Department of Justice and seven state utility commissions. Fourteen other states continue to review the deal, along with regulators in the District of Columbia and at the FCC.
Once the transaction closes the carriers are aiming for the first half of 2011 then Qwest will become a wholly owned subsidiary of CenturyLink. Qwest investors will receive 0.1664 shares of CenturyLink stock for each share of Qwest stock they own. CenturyLink will own the majority of the combined company, at 50.5 percent.
CenturyLink will keep its headquarters in Monroe, La., as well as some of Qwests operations based in Denver. Together theyll employ about 49,000 people nationwide. As of June 30, the companies collectively served 5.2 million broadband users, 16.2 million access lines, 1.5 million video subscribers and almost 1 million wireless customers in 37 states.
CenturyLink on Tuesday also said it will pay a quarterly dividend of 0.725 in September. Qwest CEO Ed Mueller praised Tuesdays shareholder vote in a prepared statement and said Qwest investors will benefit from an increased dividend and will be able to participate in the upside potential of the combined company through ownership in CenturyLink stock.”
Qwest investors have only received an 8 cent dividend since February 2008; the company didnt pay any dividends in the previous six years.
Shares of CenturyLink closed 10 cents higher at $36.01 while Qwest closed 2 cents higher at $5.66.