Rural telecommunications provider Ntelos Inc. said it has commenced a self-tender offer to repurchase up to 76 percent of its existing equity in relation to a previously announced agreement to be acquired by a pair of venture-capital firms.
The self-tender offer calls for Ntelos to pay $40 in cash per common share on a fully diluted basis up to an aggregate consideration of $440 million. The tender offer is scheduled to expire Feb. 18.
The company noted that it has received commitments from lenders for a senior secured first lien bank financing in the form of a $400 million term loan facility, $35 million in a revolving credit facility and $225 million in a senior secured second lien term loan facility.
Following the tender offer, an affiliate of Quadrangle Capital Partners LP and Citigroup Venture Capital Equity Partners LP will purchase up to 24.9 percent of Ntelos’ common stock at $40 per share. Following additional regulatory approval, Quadrangle and CVC will then acquire the remainder of Ntelos at the same $40 per share price in a merger transaction.
Ntelos, which became a private company after emerging from bankruptcy protection in 2003, noted that its two current largest shareholders-Morgan Stanley & Co. Inc. and affiliates of Capital Research and Management Co.-have agreed to the transaction.
Ntelos also reported $334 million in consolidated operating revenues, $55 million in consolidated operating income and $39 million in consolidated net income for 2004. In addition, the company said it expects to post approximately $120 million in earnings before interest, taxes, depreciation and amortization for last year.
Ntelos, which previously served as a partner of Sprint PCS affiliate Horizon PCS Inc., operates a CDMA-based wireless network covering parts of Virginia, West Virginia, Kentucky and North Carolina.
