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AT&T acquires Convergys’ minority stake in Cincinnati-area cellular partnerships

Deal for approximately $320m; does not require regulatory approvals

By CBR Staff Writer

Communications company AT&T has acquired Convergys’ minority interests in the Cincinnati SMSA Limited Partnership and an associated cell tower holding company for approximately $320m.

The company said that the decision to purchase Convergys’ minority stake was driven by financial and operational considerations.

The deal does not require regulatory approvals because AT&T acquired minority interests in partnerships it already controlled.

In the US, AT&T provides mobile broadband network, Wi-Fi services, high speed Internet and voice services.

The company said that it expects any impact on its earnings and cash flows from the deal will be insignificant.

In 1998, Convergys received a 34% limited partnership interest in Cincinnati SMSA and a 45% limited partnership interest in Cincinnati SMSA Tower Holdings, which are together referred to as the "cellular partnerships."

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Under terms of the purchase agreement, Convergys is will receive its share of the cash distribution for the second quarter performance.

Convergys expects net after-tax cash proceeds from the sale to be approximately $250m, or $2 per diluted share.

Convergys president and CEO Jeff Fox said, "This transaction simplifies our corporate structure, increases our financial flexibility, and provides investors better visibility into our recurring earnings stream from our operating units."

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