By Scott Miller
smiller@scbiznews.com
Published Nov. 3, 2009

Windstream Corp.’s planned acquisition of Greenville-based NuVox Inc. “bodes well” for the 700 employees located here, said NuVox CEO James Akerhielm.

Windstream of Little Rock, Ark. said today that it has entered an agreement to acquire NuVox for $643 million. The transaction is expected to close in the first half of 2010. NuVox employees were informed of the news this morning.

While details of the integration haven’t been worked out, Akerhielm predicted much of NuVox’s operations would remain in place. Windstream operates mostly in rural communities where NuVox does not, he said, and NuVox’s core products will be new products for Windstream.

“They are attracted to our product set. They are attracted to the technology platforms that serve that product set. They are very attracted to our sales distribution. They are attracted to our people and our product, and I think that bodes well for the employees in Greenville, our customers and our shareholders,” Akerhielm said of Windstream.

“They intend to use the NuVox platform and resources to aggressively grow the enterprise businesses,” he added.

Akerhielm, who has been CEO of NuVox and its predecessor companies since 2001, said his future role with Windstream has not been determined. He did say some Greenville management operations will remain in place.

“My real challenge and NuVox’s challenge is digesting this news and moving forward,” he said. “We’ve got opportunities to improve our business and we’ve got to focus on that.”

He also didn’t know if the NuVox brand would carry forward after the transaction is complete.

Windstream President and CEO Jeff Gardner stated in a press release that the acquisition will allow Windstream to significantly grow its business and broadband revenues.

In the release, Windstream said it "expects to maintain a significant employment presence in Greenville to manage sales and service for the company`s combined competitive local exchange properties after the transaction closes.

“Additionally, NuVox`s complementary footprint allows Windstream to strengthen its presence across the Southeast and Midwest, providing expanded reach to focus on small and medium business growth opportunities.”

NuVox employs 700 people in Greenville and 1,700 across its markets in the Southeast and Midwest. It is a privately held company. Investors include MC Venture Partners, Columbia Capital, Kohlberg Kravis Roberts & Co., and Wachovia Capital Partners.

NuVox has 48 locations in 16 contiguous Southeastern and Midwestern states. In South Carolina, NuVox has offices in Greenville, Charleston and Columbia. The company offers advanced IP-based voice and data services to approximately 90,000 business customers.

Windstream Corp. is an S&P 500 company that provides phone, high-speed Internet and high-definition digital television services to customers in 16 states. Windstream, which is a spinoff of Alltel and Valor Communications Group, reports annual revenues of around $3 billion.

Windstream expects to issue approximately 18.7 million fixed shares of stock valued at $183 million, based on Windstream`s closing stock price on Nov. 2, 2009, and pay approximately $280 million in cash as part of the transaction. Windstream also will assume estimated net debt of approximately $180 million. Windstream intends to finance the acquisition with existing cash and current capacity on its revolving credit agreement.

Windstream stock was down 0.51% in early trading to $9.74 a share.