MONROE, La.--(BUSINESS WIRE)--Feb. 3, 2005--CenturyTel, Inc.
(NYSE: CTL) announced today that it has entered into a definitive
agreement to purchase metro fiber networks in 16 markets, primarily in
the central United States, from KMC Telecom Holdings, Inc.
(KMC) for
$65 million cash, subject to purchase price adjustments.
CenturyTel
anticipates completing this transaction by third
quarter 2005, subject to regulatory approval. The transition of these
markets is expected to be seamless to KMC's existing customers. The
transaction is anticipated to be breakeven, or slightly dilutive
including transition costs, for the first 12 months of operation and
accretive to earnings per share thereafter.
CenturyTel
will operate these networks and related assets through
its LightCore subsidiary, which provides fiber optic services to
national and regional communications carriers. The KMC networks being
acquired include almost 1,000 lit route miles of metro fiber and more
than 100 points of presence (POPs), and will bring LightCore's total
network to more than 9,700 lit route miles of fiber and 618 total
POPs.
"This acquisition advances CenturyTel's
strategic goal of
continuing to grow and diversify our revenue streams by becoming a
dominant fiber transport provider to smaller cities and rural areas in
and near our local exchange and LightCore markets," Glen F. Post, III,
CenturyTel
chairman and CEO, said. "It also positions LightCore to
grow the enterprise and government segments of its customer base."
With this purchase, CenturyTel
will add key markets to its
LightCore footprint across Alabama, Indiana, Kansas, Louisiana,
Michigan, Minnesota, Mississippi, Ohio, Tennessee, Texas and
Wisconsin.
Stock Repurchase Program
CenturyTel
also announced today that its board of directors
approved a stock repurchase program authorizing it to repurchase up to
an aggregate of $200 million of either its common stock or convertible
equity units.
Repurchases under the program may be made in the open market or in
privately negotiated transactions at such times and in such amounts as
management deems appropriate, depending on market conditions and other
factors. The program will expire in December 2005, unless extended by
CenturyTel's
board of directors. The new program follows CenturyTel's
$400 million repurchase program, which was completed during 2004.
"CenturyTel's
free cash flow generation and strong balance sheet
enable us to return value to shareholders through another stock
repurchase program while continuing to grow our business through this
strategic acquisition," Post said.
As of December 31, 2004, CenturyTel
had outstanding approximately
132.4 million common shares and $500 million stated value of
convertible equity units. Wednesday's closing prices of CenturyTel's
common stock and convertible equity units (CUSIP 156700403) were
$34.05 and $25.45 per share, respectively.
In addition to historical information, this release includes
certain forward-looking statements, estimates and projections that are
based on current expectations only, and are subject to a number of
risks, uncertainties and assumptions, many of which are beyond the
control of the Company. Actual events and results may differ
materially from those anticipated, estimated or projected if one or
more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect. Factors that could affect actual results
include but are not limited to: Company's ability to obtain
governmental approvals and third-party consents in a timely manner;
the possibility of unforeseen near-term cash requirements; the ability
to manage and maintain key customer relationships; the timing, success
and overall effects of competition from a wide variety of competitive
providers; the risks inherent in rapid technological change; the
effects of ongoing changes in the regulation of the communications
industry; the Company's ability to effectively manage its growth,
including integrating newly acquired businesses into the Company's
operations, hiring adequate numbers of qualified staff, and
successfully upgrading its billing and other information systems;
possible changes in the demand for, or pricing of, the Company's
products and services; the Company's ability to successfully introduce
new product or service offerings on a timely and cost-effective basis;
other risks referenced from time to time in the Company's filings with
the Securities and Exchange Commission; and the effects of more
general factors such as changes in interest rates, in general market,
labor or economic conditions, or in legislation, regulation or public
policy. These and other uncertainties related to the Company's
business are described in greater detail in the Company's Annual
Report on Form 10-K for the year ended December 31, 2003. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release. The
information contained in this release is as of February 3, 2005. The
Company undertakes no obligation to update any of its forward-looking
statements.
CenturyTel, Inc.
(NYSE: CTL) provides a full range of local, long
distance, Internet and broadband services to consumers in 22 states.
Included in the S&P 500 Index, CenturyTel
is a leading provider of
integrated communications services to rural areas and smaller cities
in the United States. Visit CenturyTel
at www.centurytel.com.
CONTACT: CenturyTel, Inc.
Media:
Annmarie Sartor, 318-388-9671
annmarie.sartor@centurytel.com
or
Investors:
Tony Davis, 318-388-9525
tony.davis@centurytel.com
SOURCE: CenturyTel, Inc.