Alltell Sold For $24 Billion
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Richard Baguley Published on May 21, 2007 Comment on this |
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May 21st 2007 – The wireless network Alltel has been bought out by two private equity firms in a deal valued at $24.8 billion dollars.The deal involves the two firms (TPG Capital and GS Capital Partners) paying $71.50 for each share of the company, which had a price of around $65.35 on Friday. Alltell have been aggressively marketing their services in a number of markets, with their main selling point being their MyCircle plan, which allows unlimited calling to 10 numbers on any wired or wireless network.
Private Equity firms are often known for their habit of buying companies, making big changes to increase profits, then selling them, but Scott Ford, CEO of Alltel (who will remain with the company) claims that isn’t the case for this sale: “"TPG and GSCP are long-term investors who are willing to make the investments necessary to continue to grow our wireless business in all of our markets” he said in a press release announcing the sale. However, private equity firms usually don’t invest the large amounts of money the company would need to expand and compete directly with the 4 large networks, so it seems that the firms may be positioning the company for a sale to one of the big 4 networks sometime in the future. The Alltell deal is expected to be completed by March 28th.
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