As a part of the Verizon Wireless (VZW) acquisition of Alltel, regulators required VZW to divest of certain properties.

Atlantic Tele-Network, Inc (ATNI) announced on June 9, 2009 a definitive agreement to acquire certain wireless assets from VZW for $200M in cash.  Under the terms of the agreement, ATNI will acquire wireless properties, including wireless spectrum licenses and network assets, serving over 800,000 subscribers primarily in rural areas across Georgia, North Carolina, South Carolina, Illinois, Ohio and Idaho. 

This is an attractive deal as AT&T forked over more than $1,500 apiece for the 1.5M subscribers it is acquiring from VZW.  Based on this deal for 800,000 subscribers, ATNI will be paying only $250 per subscriber.

Pro forma analysis based on ATNI’s first quarter financials and assuming ATNI won’t quite be able to maintain Alltel’s ARPU and margin going forward results in ATNI wireless revenue leapfrogging from $127M (run-rate) in the first quarter to more than $600M and overall cash flow will increase from about $104M to nearly $250M annually.

Deal multiples were approximately 0.4x revenue and 1.0x OIBDA.  Nice deal for ATNI.

We will look at outstanding ILEC, CLEC, Network and Wireless deals still set to close in 2009 in an upcoming post.