Windstream to Acquire PAETEC Valued At Approximately $2.3 Billion

Windstream Corp. WIN has entered into a definitive agreement to acquire PAETEC Holding Corp. PAET, based in Fairport, N.Y., in a transaction valued at approximately $2.3 billion. "This transaction significantly advances our strategy to drive top-line revenue growth by expanding our focus on business and broadband services," said Jeff Gardner, president and CEO of Windstream. "The combined company will have a nationwide network with a deep fiber footprint to offer enhanced capabilities in strategic growth areas, including IP-based services, data centers, cloud computing and managed services. Financially, we improve our growth profile and lower the payout ratio on our strong dividend, offering investors a unique combination of growth and yield." "Both PAETEC and Windstream are built on a customer and employee-focused culture. Together, with far denser network assets, an expansive fiber infrastructure, and larger data center footprint, I believe our brightest days are ahead," said Arunas A. Chesonis, chairman and CEO, of PAETEC. "Our combination now creates a new Fortune 500 company with the financial strength and scale to compete and win against any other provider in the industry. I'm confident that this transaction will deliver substantial long-term value for our customers, employees, and shareholders." Windstream also will assume or refinance PAETEC's net debt of approximately $1.4 billion at the time of closing. PAETEC stockholders are expected to own approximately 13 percent of the combined company upon closing of the transaction.