Acquisition
VODAFONE AIRTOUCH PLC
19 July 1999
VODAFONE AIRTOUCH ACQUISITION OF COMMNET CELLULAR TO
EXPAND AIRTOUCH'S FOOTPRINT IN NINE WESTERN STATES
Vodafone AirTouch Plc announced today that it has agreed, through
its wholly owned subsidiary AirTouch Cellular, to purchase the
entire issued share capital of CommNet Cellular Inc., ('CommNet')
for $764 million in cash, plus debt which is expected to be about
$600 million at the close of the transaction. Under the terms of
the agreement, shareholders of CommNet will receive $31 per share
in cash, plus 8 percent annual interest from 18 July, 1999 until
closing. CommNet is majority owned by Blackstone Capital Partners
II, a private equity fund of the Blackstone Group, a private
investment bank in New York. The transaction is subject to
customary conditions including receipt of approval from the Federal
Communications Commission.
The deal, which is expected to close in four to five months, will
add vast new regions to AirTouch's coverage area in the Western
United States. CommNet offers service in most of Colorado,
Montana, North Dakota, South Dakota, Utah and Wyoming and parts of
Idaho, Iowa and New Mexico. It also owns minority interests in
operations in three other states.
CommNet's share of those markets gives it access to 3.6 million
potential customers. Today it has about 360,000 proportionate
customers.
The purchase fills gaps in AirTouch's coverage area which until now
have been served through costly roaming agreements. AirTouch will
now be able to extend service to communities such as Rapid City and
Sioux Falls, South Dakota; Sioux City, Iowa; Bismarck, North
Dakota; Great Falls and Billings, Montana; and Pueblo, Colarado.
'CommNet's markets are well managed and fit ours like a hand in a
glove,' said Chris Gent, CEO of Vodafone AirTouch Plc . 'This deal
will allow customers to enjoy the benefits of AirTouch quality over
a much broader area. It will cut our roaming costs and offer
significant marketing synergies, which will enable us to improve
the value we offer customers'.
Arnold C.Pohs, Chairman and CEO of CommNet, said, 'This transaction
joining CommNet with the world's largest wireless
telecommunications company is a true benefit for our shareholders,
subscribers, telephone company partners, employees and future
customers. As the definitive provider of cellular telephony to
rural America, we now know that our heritage of service and quality
is now firmly secure for the future, for truly the best is yet to
come'.
AirTouch serves 9 million US cellular and PCS customers on a
proportionate basis. Its ventures operate in 25 states and 22 of
the top 30 US markets, including Atlanta, Chicago, Dallas,
Detroit, Houston, Los Angeles, Miami, Phoenix, San Diego, San
Francisco and Seattle. AirTouch Cellular is part of Vodafone
AirTouch Plc, the world's largest mobile communications company,
which is based in the United Kingdom. It has operations in 23
countries on five continents, with almost 28 million proportionate
cellular customers.
For further information please contact:
Terry G Barwick, Director of Corporate Affairs, Vodafone AirTouch
Telephone: 01635 33251
Tim Brown/Melissa Stimpson, Investor Relations Department, Vodafone
AirTouch
Telephone: 01635 33251
Jonathan Marshall, AirTouch Cellular
Telephone: 001 415 658 2209
Peter Willetts, Tavistock Communications Limited
Telephone: 0171 600 2288