Light Reading

CenturyTel, Embarq Merge

Light Reading
LR Cable News Wire Feed
Light Reading

MONROE, La. -- CenturyTel, Inc. (NYSE: CTL) and Embarq Corporation (NYSE: EQ) announced today that they have completed their merger. The combined company, which will be known as CenturyLink, serves more than 2.1 million broadband customers, more than 440,000 video subscribers and approximately 7.5 million access lines in 33 states, based on operating results as of March 31, 2009.

"The completion of this merger is a significant event for our customers, communities, investors and employees," said Glen F. Post III, president and chief executive officer. "CenturyLink has the advanced networks, the people and the financial stability to deliver the reliable and innovative services that our customers want and need. We look forward to this exciting new chapter in our company's history."

CenturyLink expects to generate annual full run-rate operating and capital synergies of approximately $400 million by 2011. Based on this synergy level and operating results of the two companies for the twelve months ended Dec. 31, 2008, CenturyTel would have had combined revenue of more than $8 billion, combined operating cash flow of over $4.2 billion and combined free cash flow of approximately $1.9 billion. The company expects to continue its current annual dividend of $2.80 per share. The company anticipates the combination to be accretive to free cash flow per share in 2010, the first full year post-closing. All figures and statements in this paragraph exclude the impact of one-time integration costs.

In accordance with the terms of the Merger Agreement, EMBARQ stockholders received 1.37 CenturyTel shares for each share of EMBARQ common stock they owned at closing. The transaction was structured as a tax-free stock-for-stock exchange. Other than assuming EMBARQ's existing debt, the combined company has incurred neither any incremental debt nor any change to debt maturity schedules.

While the company's corporate identity will immediately change to CenturyLink, customer-facing operations and communications will continue under the CenturyTel and EMBARQ brand names until a full brand conversion occurs later this year. The company intends to formally change its name to "CenturyLink, Inc." upon receipt of shareholder approval, which it expects to solicit in May 2010. The company's stock continues to trade on the New York Stock Exchange under the ticker symbol "CTL."

The corporate headquarters of the company will remain in Monroe, La. Regional operating headquarters will be located in Las Vegas, Nev., Wentzville, Mo., Orlando, Fla., Wake Forest, N.C., and La Crosse, Wis. The company also maintains a significant presence in the Overland Park, Kan. area, the former location of EMBARQ's corporate headquarters.

CenturyLink Inc. (NYSE: CTL)

Embarq Corp. (NYSE: EQ)

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
User Rank: Light Beer
12/5/2012 | 4:01:41 PM
re: CenturyTel, Embarq Merge


The point of "annual full run rate" is to give a view to what it will be like for the combined entities on a full 12 month basis - like annual results.  "Newco" aka Centurylink can only represent results from when the combination closed (today).  So, this means that they are giving investors a view to a full 12 month view.

"Capital Synergies" represents the ability to spend less on capital than the two entities would have spent separately.  This will come from two factors.  There will be some properties that were nearby or adjacent and there will be some sharing of facilities and equipment (buying a bit less equipment).  The second factor is that Centurylink is a lot bigger than CenturyTel and a some bigger than Embarq.  One would expect them to ask for a better discount structure in at least the f-CenturyTel properties and perhaps some better overall.  Calix, for example, is about to lose a bunch of margin.




User Rank: Light Beer
12/5/2012 | 4:01:41 PM
re: CenturyTel, Embarq Merge

Anyone know what "annual full run-rate operating and capital synergies" means? Is that marketing-speak for "OPEX and CAPEX" savings maybe?


From The Founder
The comms industry is rallying to the cause of open, independent interoperability testing.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
Telecom Innovators Video Showcase
Tail-f, Cisco & What the Future Holds

10|9|15   |   8:17   |   (0) comments

Steve Saunders meets with Tail-f's Director of Technology, Carl Moberg, in Stockholm to discuss becoming part of Cisco, ETSI MANO, virtualization and the need to combine science and business in order to create opportunities for service providers.
LRTV Interviews
Broadband Forum Embraces SDN & NFV

10|9|15   |   02:42   |   (0) comments

At Gigabit Europe 2015, Robin Mersh and Kevin Foster from the Broadband Forum explain how the industry body is adapting to meet the SDN, NFV and cloud needs of the access network sector.
LRTV Interviews
Top Tips for FTTH Operators

10|8|15   |   02:26   |   (0) comments

At Gigabit Europe 2015, Ventura Team co-founder Richard Jones talks about some of the key business case considerations for FTTH network operators.
LRTV Interviews
M-net Calls for FTTx Unity

10|8|15   |   03:45   |   (0) comments

At the Gigabit Europe event, Jörn Schoof from M-net, the Munich city network operator, calls for industry collaboration on fiber broadband access rollouts.
LRTV Documentaries
The Business Case Challenge for NFV

10|7|15   |   03:47   |   (0) comments

Virtual CPE is one of the early success stories for network functions virtualization, as service providers are finding flexible, programmable CPE solves a lot of logistics problems and reduces their cost. But even here, Masergy Communications faced a business case challenge, says CTO Tim Naramore.
LRTV Interviews
JT Offers Some Gigabit Lessons

10|7|15   |   4:08   |   (1) comment

Barna Kutvolgyi, managing director, Global Consumer, at JT, the incumbent operator on the island of Jersey, talks about how other service providers can learn from his company's gigabit broadband rollout experiences.
LRTV Interviews
AT&T's Chiosi on the Potential of Open Source

10|6|15   |   06:27   |   (0) comments

AT&T Distinguished Network Architect Margaret T. Chiosi talks to Light Reading's Carol Wilson about the potential for open source technology to liberate communications service providers.
LRTV Interviews
Network Security in a Gigabit World

10|6|15   |   05:52   |   (0) comments

Masergy's James Harrison talks about some of the network security and data center issues network operators need to consider as they expand their broadband services portfolios.
LRTV Documentaries
Telefónica: In Search of Virtual Simplicity

10|5|15   |   07:30   |   (0) comments

Francisco-Javier Ramon Salguero, head of Telefónica's NFV initiative, admits virtualization initially means greater complexity, but with the right abstraction layer, it is possible to create a services-driven network architecture. He explains how Telefónica's current trials and initiatives are aimed at doing that, and what his company and other carriers need to ...
LRTV Interviews
Gigabit Europe Takeaways

10|5|15   |   03:47   |   (0) comments

Participants from the inaugural Gigabit Europe event in Munich share their key takeaways from the conference.
Women in Comms Introduction Videos
Intel Urges Women to Take Advantage of Their Seat at the Table

10|5|15   |   4:27   |   (1) comment

Have inclusive and constructive conversations, attach a bigger meaning to your work and get involved in the cause, Intel's Monique Hayward advises women in comms.
LRTV Interviews
BT Updates on Plans

10|2|15   |   03:16   |   (2) comments

Peter Bell, CIO at Openreach, the access network division at UK incumbent BT, provides an update on the operator's trials and how Openreach is planning to deploy the broadband technology in its street cabinets.
Upcoming Live Events
October 14-15, 2015, New Orleans Ernest N. Morial Convention Center, New Orleans, LA
November 5, 2015, Hilton Santa Clara, Santa Clara, CA
November 17, 2015, Santa Clara, California
December 1, 2015, The Westin Times Square, New York City
December 2, 2015, The Westin Times Square, New York City
All Upcoming Live Events
Network appliances have a strong value proposition in today's networks and will continue to do so in the NFV and SDN-enabled networks of tomorrow.
Hot Topics
M&A Speculation Swirls Around Juniper
Ray Le Maistre, Editor-in-chief, 10/6/2015
Cisco's Chambers Rules Out Political Bid
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/6/2015
Cord Cutting? 'Fraid so.
Brett Sappington, 10/7/2015
Infinera Fleshes Out Its Metro 100G Story
Ray Le Maistre, Editor-in-chief, 10/7/2015
Cisco Makes 'Martian' Connection
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/9/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
With so many new and exciting communications technologies now under development, it's easy to get caught up in the industry's escalating hype cycle. That's why the ...
Last week saw a big day in the 15-year history of Light Reading when Editor-in-Chief Ray Le Maistre and I were invited to interview the Deputy Chairman and Rotating ...
Cats with Phones
"What?! I'm on with Finisar about their stock price tanking" Click Here