Windstream to acquire Paetec; expands national telecom footprint

Telecommunications firm Windstream on Monday said it would acquire network services company Paetec for about $2.3 billion, including assumed debt of $1.4 billion.

The Little Rock, Ark.-based company says its acquisition of Fairport, N.Y.-based Paetec will allow it to create a "formidable national telecommunications provider" with more than $6 billion in total revenue, creating a nationwide network with about 100,000 miles of fiber.

(Before the deal, Windstream had about 60,000 miles of fiber.)

"This transaction significantly advances our strategy to drive top-line revenue growth by expanding our focus on business and broadband services," Windstream CEO Jeff Gardner said in a statement.

The acquisition also gives Windstream, which specializes in networked services for businesses and government agencies, a stronger presence in the cloud computing, IP-based services, datacenter and metro fiber markets. Paetec operates in 86 of the top 100 metropolitan areas in the U.S.

"Together, with far denser network assets, an expansive fiber infrastructure, and larger data center footprint, I believe our brightest days are ahead," Paetec CEO Arunas Chesonis said in a statement.

Terms call for Paetec stockholders to receive 0.46 Windstream common shares for each Paetec share; Paetec stockholders will own about 13 percent of the combined company when the deal closes in six months or so.