The Free Press, Mankato, MN

Local News

June 30, 2014

Enventis purchased by Illinois telecom

$350 million all-stock deal

MANKATO — Longtime Mankato-based Enventis is being purchased by Consolidated Communications Holdings of Illinois in a $350 million all-stock deal.

Consolidated, one of the largest independent communications companies in the country, will acquire 100 percent of the 13.8 million Enventis shares

Shareholders of the 116-year-old Mankato company, formerly called HickoryTech, will receive 0.7402 shares of Consolidated stock for each share of Enventis (formerly HickoryTech) stock.

John Finke, Enventis CEO, said the future of the 290 employees in the Mankato area won't be known until the deal is finalized in the fourth quarter.

"I wish I could be a little more specific on that. There should be no immediate effects on operations or employees," Finke said. He said that the companies will be discussing "integration and what the company will look like" in the coming months.

Based on the closing price of Consolidated on Friday, the deal represents $16.50 per share for each Enventis share equating to a premium of 17.4 percent over the Enventis closing price on Friday, or 27.2 percent over the past 90-day average share price.

Consolidated Communications is maintaining its current annual dividend policy of about $1.55 per share, which it has consistently paid since its initial public offering in 2005.

The combined company will have about $785 million in revenue and $332 million in adjusted income for the 12 months ending March 31.

Companies similar in services, history

“This transaction combines two companies with similar strategies and cultures, resulting in a financially strong company with a robust balance sheet and attractive dividend payout ratio,” Bob Currey, Consolidated CEO said in a statement.

“Enventis has built a strong business delivering competitive business and broadband services over a 4,200 route mile fiber network. The combination and additional markets creates a broader platform from which to grow and expand."

Finke said the two companies, both of which grew from more than century-old local phone companies, are very similar in their services and offerings to largely rural and smaller city areas.

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