After previously striking a deal in November, Alaska Communications has reeled in a bigger buyer to the tune of $332 million.
Alaska Communications announced on Monday that it would be bought by a newly formed entity owned by ATN International and Freedom 3 Capital. The $332 million cash deal, which includes net debt, surpassed the $300 million, all cash deal that was previously announced with an affiliate of Macquarie and GCM.
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Under terms of the previous agreement, Alaska Communications was allowed to solicit “superior proposals” from third-parties. Alaska Communication’s board of directors, along with its advisors, said at the time that they intended to look for superior buy-out proposals, which resulted in the new deal.
In connection with the termination of the previous deal, Alaska Communications paid Macquarie and GCM a $6.8 million break-up fee. The new deal, which is expected to close in the second half of 2021, will result in Alaska Communications becoming a consolidated, majority owned subsidiary of ATN.
Under the terms of the new agreement, an affiliate of ATN will acquire all the outstanding shares of Alaska Communications common stock for $3.40 per share in cash. Under the terms of the previous agreement, an affiliate of Macquarie and GCM was slated to buy all of the outstanding shares of Alaska Communications’ common stock for $3 per share in cash.
“This transaction represents an exciting opportunity to augment our market position, as well as, expand our capabilities to better serve our customers,” said Bill Bishop, president and CEO of Alaska Communications, in a statement. “ATN has extensive telecommunications expertise, a strong track record of successfully investing in and operating capital-intensive businesses and has a strong financial position highlighted by its net cash position. These are critical attributes that will support our strategy to deliver superior customer service utilizing our fiber-based network solutions. We firmly believe this transaction will allow us to enhance our expanded fiber network services and drive long-term value for our employees and customers in Alaska.”
Alaska Communications, which was founded in 1998, provides broadband and managed IT services for its business and residential customers in Alaska. It also operates an undersea fiber-optic system to connect Alaska to the contiguous U.S.