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In connection with the Merger, each outstanding warrant to purchase shares of FairPoint common stock converted into a warrant to acquire shares of the Company’s common stock, upon exercise, on the same terms and conditions that were applicable to such FairPoint warrant, except that the number of shares of the Company’s common stock for which each such warrant may be exercisable and the exercise price of each warrant was adjusted to reflect the exchange ratio. Accordingly, as of the effective time of the Merger, there are approximately 2,615,153 Company warrants outstanding, each eligible to purchase one share of Company common stock at an exercise price of $66.86 per share. The Company assumed these warrants pursuant to an Assumption Agreement, dated July 3, 2017, between the Company and Computershare Trust Company N.A. (as successor to The Bank of New York Mellon), as Warrant Agent, which is attached as Exhibit 4.1 to this Current Report on Form 8-K and incorporated into this Item 2.01 by reference.
So owning the warrants may have 3 possible outcomes.
1. The share price of CNSL goes above $66.86 before January 24 2018 in which case we could exercise the warrant through our broker to purchase CNSL stock at the lower price and make a paper profit on the difference.
2. The share price of CNSL looks like it will exceed the $66.86 mark and traders want to buy the warrants betting the price will go up and make the warrants more valuable as the timeline approaches.
3. We buy them and do nothing. The price of CNSL does not reach its mark. The warrants expire worthless on the 24th of January.
Awesome. Appreciate you looking into it
Exercisable until later this year....
The exact date I have in the prospectus and will post it. I believe I need to back into the math to see what the prices of both stocks were at the time of the warrant rollout.
Nice. Do you know when the warrants are exercisable and the pps exercise price? If that is how warrants work- lol
Response from VP Corporate Communications FairPoint
Yesterday, 10:15 AM
Mr. xxxx,
Both the share count and price of the warrants were adjusted based on the 0.73 exchange ratio of the merger agreement with Consolidated. CNSL assumed the obligations of FRP under the warrants and all other terms / conditions remained the same, including the expiration date.
Please let me know if you have any additional questions.
Thanks,
Paul
Paul Taaffe – Vice President Corporate Communications and Development
FairPoint Communications | 521 E. Morehead St, Suite 500, Charlotte, NC 28202 | ptaaffe@fairpoint.com
www.FairPoint.com | 704-227-3623 office | 704-936-8941 cell
This seems to good to be true.
good job on the ibox
Consolidated Communications Completes FairPoint Acquisition
Date : 07/03/2017 @ 1:00PM
Source : GlobeNewswire Inc.
Stock : Consolidated Communications Holdings, Inc. (MM) (CNSL)
Quote : 18.42 -0.36 (-1.92%) @ 6:57PM
Consolidated Communications Completes FairPoint Acquisition
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Consolidated Communications Holdings, Inc. (NASDAQ:CNSL) announced today it has completed its acquisition of FairPoint Communications, Inc. (NASDAQ:FRP), an all-stock transaction valued at approximately $1.3 billion including debt and based on present equity value. The merger further positions the company as a leading broadband and business service provider across a 24-state service area.
“Consolidated Communications’ mission is to turn technology into solutions, connecting people and enriching how they work and live,” said Bob Udell, president and chief executive officer of Consolidated Communications. “We know our customers’ needs are changing and this business combination creates a stronger company with greater scale and resources to serve our customers. We are excited to close on the acquisition and look forward to realizing the many benefits of this merger and leveraging our combined team’s expertise.”
Based on today’s transaction closing, under the terms of the agreement, FairPoint stockholders will receive a fixed exchange ratio of 0.7300 shares of Consolidated Communications common stock for each share of FairPoint common stock. No fractional shares of Consolidated Communications common stock will be issued. Each of FairPoint's stockholders will be entitled to receive, in lieu of any fractional share of Consolidated Communications common stock, an amount in cash equal to the value of the fractional share of Consolidated Communications common stock to which such stockholder would otherwise have been entitled, less applicable taxes required to be withheld.
“The financial benefits associated with the combination in the form of cost savings and reduced financial leverage provide us additional operating and strategic flexibility going forward,” Udell said. “The transaction is meaningfully accretive to free cash flow per share in the first year and supports our current dividend policy to shareholders while making meaningful investments to enhance the network.”
Combined Company Facts and Strategic Benefits
Significant Fiber Network Expansion: The acquisition of FairPoint will add 22,000 fiber route miles to the Consolidated Communications fiber network, without any overlapping markets. The combined network spans 24 states and more than 36,000 fiber route miles, making Consolidated Communications the ninth largest fiber provider in the U.S. Consolidated Communication’s on-net buildings grow to 8,800 and fiber-connected towers total 2,600.
Enhanced Product and Services Portfolio: The company plans to expand its cloud services product suite to FairPoint markets, as well as other broadband enhancements. Overall, the combined company will eventually offer an even broader range of solutions, tools, and resources benefiting all customer groups.
Added Scale, Complementary Business Strategies: The merger combines two companies with complementary business strategies and provides a meaningful increase in scale to address the ever-changing competitive landscape.
On-Target Run-Rate Synergies: The transaction is expected to generate annual run rate cost savings of approximately $55 million, which are expected to be achieved within two years after completion of the merger. Consolidated has proven its ability to successfully integrate companies and meet or exceed synergy targets.
Stronger Financial Profile: Consolidated expects the transaction to be meaningfully accretive to free cash flow per share in the first year. The company will benefit from $300 million in net operating losses (NOLs) and it has refinanced FairPoint’s debt on very attractive terms. Additionally, the transaction will significantly improve the company’s balance sheet and capital structure and supports its current dividend policy to stockholders.
Experienced Team and Expertise: The combined team of approximately 4,400 employees will leverage best practices and greater resources to serve customers.
Dividend Practice
Consolidated Communications’ Board of Directors declared a quarterly dividend of $0.38738 per share consistently for 48 quarters since its initial public offering in 2005. The Consolidated Communications Board of Directors expects to maintain its annual dividend of $1.55 per share. The next quarterly dividend of $0.38738, which was declared on May 2, 2017, is payable on Aug. 1, 2017, to stockholders of record on July 15, 2017.
Management, Board and Headquarters
Bob Udell will continue to serve as president and chief executive officer and Steve Childers will serve as chief financial officer of the combined company. As part of the merger agreement, Consolidated has appointed Wayne Wilson, a New Hampshire resident who previously served on the FairPoint Board, to the Consolidated Communications Board at closing. The newly combined company will continue to be headquartered in Mattoon, Ill. and senior executives will be based throughout its service area.
Earnings and Guidance
Consolidated Communications will report second quarter 2017 earnings on Aug. 3, 2017. The company will discuss results and other developments for the combined company during the call and will update its annual guidance with its second quarter earnings report.
About Consolidated Communications
Consolidated Communications Holdings, Inc. (NASDAQ:CNSL) is a leading broadband and business communications provider serving consumers, businesses of all sizes, and wireless companies and carriers, across a 24-state service area. Leveraging its advanced fiber optic network spanning more than 36,000 fiber route miles, Consolidated Communications offers a wide range of communications solutions, including: data, voice, video, managed services, cloud computing and wireless backhaul. Headquartered in Mattoon, Ill., Consolidated Communications has been providing services in many of its markets for more than a century.
The IBOX begins.
sweet dynamite. jackpot $FRPZW
Well we get .73 shares in the new company for each share we have in FRPZW. I don't think that is an issue since their value is off the hook. I would fully expect the authorized to increase since it is so low.
Wow small world. I know Colby and his dad before his dad passed away. Both great people, in fact I worked for them directly. Interesting scenario here.
what is it saying? when i read these filings the most i ever get out of them is usually just a headache.
these warrants may be worth something - FRP traded @ $15 on july 3rd:
Fairpoint Communications, Inc. (FRP)
NasdaqCM - NasdaqCM Delayed Price. Currency in USD
https://finance.yahoo.com/quote/FRP/analysts?p=FRP
Maybe $FRPZW is worth 10% of FRP - that would be $1.5- who knows. the only other warrant i traded was hooters - HOTR / HOTRW - if i'm remembering correctly HOTRW traded at 10% of HOTR
Really great website very professional.
That filing speaks volumes.
Very low float so it moves fast.
Growing communications company I like it.
yep. moved big on not much volume today
Looks interesting. We'll see how it plays out...
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Together, FairPoint and Consolidated Communications (Nasdaq: CNSL) are an even stronger Company. Our combined networks, product suite, resources and expertise make us an even stronger and more competitive provider.
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