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Sprint (NYSE: S) wholesale partner Shenandoah Telecommunications, better known as Shentel, is buying fellow Sprint wholesale partner nTelos Wireless in a deal valued at around $640 million, including net debt. There had been speculation since May that such a deal would come to pass, and nTelos had been reviewing strategic alternatives.
Concurrent with the deal, Shentel entered into a series of agreements with Sprint, including the expansion of Shentel's "affiliate" relationship with Sprint. The deals essentially give Shentel responsibility for expanding the LTE network in the nTelos service area, and will give Sprint access to more spectrum.
The nTelos brand will be discontinued after the close of the deal and around 297,500 nTelos wireless retail customers will become Sprint-branded customers. Additionally, nTelos' retail stores will convert into Sprint-branded stores that will be managed by Shentel.
Shentel said Sprint has agreed to transition around 291,000 existing Sprint wireless customers in the nTelos market to Shentel, bringing the total new Shentel customers under the Sprint brand in the market to around 581,000. With the 435,000 current Shentel Wireless customers, Shentel's total wireless customers will exceed 1 million.
Most significantly, nTelos' Strategic Network Alliance with Sprint, which calls for nTelos to provide wholesale roaming services for Sprint customers, will end with the close of the deal.
NTelos shareholders will receive approximately $208 million in...