Cincinnati Bell shares close near 52-week high on news the company has agreed to be acquired for $2.6B

Randy Tucker | Cincinnati Enquirer

Cincinnati Bell has agreed to be acquired by Toronto-based conglomerate Brookfield Infrastructure Partners LP in a cash-and-debt deal valued at more than $2 billion, the two companies announced Monday.

Under the deal, Cincinnati Bell shareholders would receive $10.50 in cash for each share of common stock, or 36 percent above the company's $7.72 closing price Friday, according to a news release.

That would bring the purchase price to just over $529 million. But Brookfield has also agreed to assume about $2 billion in debt. The total value of the deal is $2.6 billion.

"After thoroughly reviewing a range of strategic alternatives and possible business opportunities for maximizing value, the board determined this transaction was in the best interest of the company, its shareholders, and its customers. The transaction provides clear and immediate value at an attractive premium and represents an exciting new chapter for Cincinnati Bell, '' said Lynn A. Wentworth, chairman of the Cincinnati Bell board.

Shares of the downtown Cincinnati-based telecommunications company closed Monday at $10.45, up $2.73, or 35.36%.

The company's shares have traded this year from a low of $3.19 to a high of $11.

Shares of Brookfield – which owns and operates a global network of infrastructure companies in utilities, transportation, energy and communications infrastructure – ended the day at $49.14, up 78 cents, or 1.61%.

The board of directors of Cincinnati Bell, which has about 4,300 full-time employees, has approved the transaction.

But the deal, expected to close by the end of 2020, is still subject to shareholder and regulatory approval.

Cincinnati Bell provides diversified telecommunications and technology services to residential and business customers across the United States, with more than 1.3 million residential customers.

It operates primarily in two segments: entertainment and communications, and IT services and hardware.

The entertainment and communications segment offers data services, including high-speed internet access through its Cincinnati Fioptics fiber-optic network.

The company reported sales of about $1.4 billion for the 2018 fiscal year, and operating income of $83 million – up $28 million from the previous fiscal year.

Cincinnati Bell officials say they're transforming the company from a legacy copper-based telecommunications company to a technology company with contemporary fiber assets.

The business is upgrading its network to next generation fiber, which will be critical to support the growing demand for data and the advent of 5G.

Our history: Cincinnati Bell service is older than the telephone