Windstream to acquire Paetec, provide guarantee for Paetec's notes

By Angela McDaniels

Tacoma, Wash., Aug. 1 - Windstream Corp. agreed to acquire Paetec Holding Corp. and plans to guarantee Paetec's outstanding 9½% senior notes due 2015, 8 7/8% senior secured notes due 2017 and 9 7/8% senior notes due 2018, according to a company news release.

Windstream must amend its senior secured credit facility in order to provide the guarantee.

Paetec shareholders will receive Windstream common stock in exchange for their Paetec shares, and Windstream will assume or refinance Paetec's $1.4 billion of net debt.

The acquisition is expected to close within six months. Windstream said the transaction is valued at about $2.3 billion, and it has received $1.1 billion of committed financing.

Paetec is a competitive local exchange carrier and provides telecommunications services primarily to business customers. It is based in Fairport, N.Y.

Windstream, based in Little Rock, Ark., is a communications and technology solutions provider.

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