A proposed union between Horizon PCS and iPCS will create the second largest
Sprint PCS affiliate in terms of coverage area. The deal is valued at $325
million.
Under the terms of the planned "merger of equals," iPCS will finance the deal
with $225 million in stock. Specifically, iPCS will offer 0.7725 shares of iPCS
common stock to Horizon shareholders for each share of Horizon stock they own.
As part of the deal, iPCS will assume $100 million in Horizon debt.
Once the deal is closed, which is expected to occur during summer 2005, iPCS
will own 57.5 percent of the combined company.
The merger will create the second largest Sprint PCS affiliate in terms of
coverage area at 11.2 million covered POPs, and the third largest in terms of
subscribers at 432,000.
The largest Sprint PCS affiliate also is being created as the result of a
merger. In December, AirGate PCS accepted an unsolicited offer from fellow
Sprint affiliate Alamosa Holdings to merge. Under the terms of the $630 million
deal, Alamosa will pay $392 million in stock and assume $238 million in net
debt. AirGate shareholders, who approved the deal in February, will receive 2.87
shares for each share of AirGate common stock they currently hold. The merger
will create the largest Sprint PCS affiliate.
Not to be left out of the merger flurry that has been occurring in the
telecom sector as of late, Sprint unveiled plans in December to combine its
business with Nextel Communications.
IPCS shares, which trade on the pink sheets, were up $4.75, or 15.8 percent,
to $34.75 at on point in noon-hour trading. Horizon PCS pink sheet shares also
were up $1.25, or 5 percent, to $26.25.