Sprint-affiliated company to purchase nTelos

( SHEN ) in an all-cash deal valued at about $640 million, including net debt. The deal represents about a 60% premium over the company’s 30-day volume weighted average stock price as on August 7. It conducts its business through NTELOS-branded retail operations, which sells its products and services via direct and indirect distribution channels and provide network access to other telecommunications carriers, notably through an arrangement with Sprint Spectrum and Sprint Spectrum on behalf of and as an agent for SprintCom (Sprint Spectrum and SprintCom collectively, Sprint), which is referred to herein as the Strategic Network Alliance.

As a result of the nTelos sale, Sprint will gain 297,500 customers to its brand in the south eastern U.S., the vast majority of which will be affiliate customers; the telco said it anticipates moving all its retail customers in the nTelos territory to Shentel.

After taking into account the payments from Sprint for the exchange of certain assets, ShenTel net consideration of the nTelos acquisition will be $330 million.

Along with the acquisition, Shentel is also amending its affiliate agreement with Sprint. The transaction is expected to close in early 2016. The proposed deal is not expected to have any impact on Ntelos’ previously announced plans to shutter its “eastern” operations, which is still expected to be completed by November.

Shentel will acquire nTelos’ wireless network assets, retail stores and about 298,000 retail subscribers left in nTelos’ western markets.

Shares of NTELOS Holdings Corp. rose by 34.38% in the last five trading days and 92.09% for the last 4 weeks. “We look forward to welcoming nTelos employees to the Shentel team and to serving the nTelos customers”.

Shenandoah Telecommunications says it is committed to investing more than $300 million to continue a 4G LTE upgrade and expand the existing nTelos wireless network. Those spectrum assets are to include Sprint’s 2.5 GHz spectrum holdings in Shentel’s footprint, which are central to Sprint’s planned updates to its LTE service.

Current Sprint and Shentel customers will not be impacted by these transactions. We believe our customers will see a seamless transition to the Sprint platform used by Shentel and will greatly benefit from Shentel’s strong track record of providing reliable wireless service through its expanded and extended affiliate relationship with Sprint. Under the terms of the deal, nTelos customers will be transferred to a Sprint-branded service managed by Shentel, with the nTelos brand ceasing to exist.