Convergys to Sell its Stake in the "Cellular Partnerships" to AT&T for $320 Million
Cincinnati, Ohio, Dallas, Texas, ---
Convergys Corporation (NYSE: CVG), a global leader in relationship management, announced today it will sell its holdings in the “cellular partnerships” located in the Cincinnati metropolitan area to AT&T* for approximately $320 million in cash.
As a result of its spin-off from Cincinnati Bell Inc. (NYSE: CBB) in 1998, Convergys received a 34% limited partnership interest in Cincinnati SMSA and a 45% limited partnership interest in Cincinnati SMSA Tower Holdings. Together, these two properties are referred to as the “cellular partnerships.”
Convergys expects the sale to generate net after-tax proceeds of approximately $250 million. Convergys will update full-year guidance to reflect cellular partnership-related impacts on EBITDA, EPS, and free cash flow after the sale closes. AT&T expects that any impact on its earnings and cash flows from the purchase of Convergys’ minority stake in these operations will be insignificant.
“The sale of this non-core asset further simplifies our business, strengthens our balance sheet, and gives our investors a clear view to the operating performance of our businesses,” said Jeff Fox, president and CEO of Convergys.
AT&T is the general partner, managing all the cellular partnerships’ business on a day-to-day basis. Convergys does not take part in this management.
Cincinnati SMSA provides wireless communications in central and southwestern Ohio and northern Kentucky, while Cincinnati SMSA Tower Holdings is a cellular tower holding company for Cincinnati SMSA.
“Financially and operationally, it makes sense for AT&T to purchase Convergys’ minority stake in our Cincinnati wireless operations,” said Larry Evans, vice president and general manager of AT&T Ohio and Western Pennsylvania. “We remain committed to providing a great experience to all our wireless customers in the Cincinnati area and throughout Ohio and Kentucky.”
Since AT&T is merely acquiring the remaining minority interest in partnerships it already controls, regulatory approvals are not required, and the companies expect the sale to close in early July, 2011.
Convergys Corporation (NYSE: CVG) is a global leader in relationship management. We provide solutions that drive more value from the relationships our clients have with their customers. Convergys turns these everyday interactions into a source of profit and strategic advantage for our clients. For more than 30 years, our unique combination of domain expertise, operational excellence, and innovative technologies has delivered process improvement and actionable business insight to marquee clients all over the world. Convergys has approximately 70,000 employees in 68 customer contact centers and other facilities in the United States, Canada, Latin America, Europe, the Middle East, Africa, and Asia, and our global headquarters in Cincinnati, Ohio. For more information, visit www.convergys.com
AT&T Inc. (NYSE:T) is a premier communications holding company. Its subsidiaries and affiliates – AT&T operating companies – are the providers of AT&T services in the United States and around the world. With a powerful array of network resources that includes the nation’s fastest mobile broadband network, AT&T is a leading provider of wireless, Wi-Fi, high speed Internet and voice services. A leader in mobile broadband, AT&T also offers the best wireless coverage worldwide, offering the most wireless phones that work in the most countries. It also offers advanced TV services under the AT&T U-verse® and AT&T | DIRECTV brands. The company’s suite of IP-based business communications services is one of the most advanced in the world. In domestic markets, AT&T Advertising Solutions and AT&T Interactive are known for their leadership in local search and advertising.
Additional information about AT&T Inc. and the products and services provided by AT&T subsidiaries and affiliates is available at http://www.att.com.
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