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Western US service provider TelePacific acquires Mpower for $204M
May 8, 2006
LOS ANGELES -- TelePacific Communications, which provides telecommunications services to businesses throughout California and Las Vegas, Nevada, and Mpower Communications Corp. (AMEX:MPE - News), which provides business, residential and wholesale telecommunications services throughout California, Las Vegas, Nevada and Chicago, Illinois, today announced that they have signed a definitive merger agreement pursuant to which TelePacific will acquire Mpower.
Under the terms of the agreement, which has been approved by the boards of directors of both companies, TelePacific will pay $1.92 in cash per Mpower share, which equates to a total equity value of approximately $204 million. The acquisition will be financed through a fully committed senior credit facility arranged by Credit Suisse and Bank of America.
The combination of TelePacific and Mpower will create a more effective and efficient provider of retail, wholesale and residential telecommunications services -- including local, long-distance, private line and data networking services -- in California, Las Vegas and Chicago. Upon completion of the transaction, TelePacific will rank as one of the leading competitive local exchange carriers (CLEC) in the Western United States.
"This transaction brings together two solid, very well-run companies that share a focus on offering a meaningful competitive choice to small and medium sized business customers," said Dick Jalkut, president and CEO of TelePacific, who will lead the combined company in the same positions. "Mpower has an outstanding network, great employees and a strong record in terms of product innovation and quality of services. These strengths, added to those of TelePacific, will improve our ability to provide advanced, high-quality telecommunications services to a broader range of customers and increase the growth opportunities available to us. Along with the numerous customer benefits, we believe the proposed transaction will yield substantial financial benefits from synergies for its investors."
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