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Welcome to Web Hosting Sites ReviewsTuesday, October 22 2013 @ 02:10 PM Eastern Daylight Time

Phone Company Windstream Purchases Hosted Solutions

On Thursday, Windstream announced that it is set to purchase the NC-based web hosting service, Hosted Solutions LLC, for $310 million. Although the transaction is still subject to regulatory approval, both companies are prepared to close the deal in the fourth quarter.

Windstream noted that they would like to use the acquisition to broaden its range of offerings, both in business services and broadband segments. It will finance the purchase with its current cash reserves as well as revolving credit. A representative also noted that they're expecting a tax benefit of approximately $52 million.

Hosted Solutions specializes its service to cater to small and medium-size businesses. They currently have 125 employees and over 600 customers.

Windstream is a landline phone company that operates in eastern regions of the US, mainly in rural areas. They currently have 3.3 million access lines and 1.27 million Internet customers.

The drive to further develop its Internet services and capabilities influenced the the Hosted Solutions acquisition, which will give Windstream more data centers. Windstream will be able to devote a greater emphasis to these areas by taking advantage of Hosted Solutions' experienced management team, particularly in its Internet business enterprise and cloud computing segment.

"Data center space is increasingly in demand among our existing business customers," Windstream president and CEO Jeff Gardner said. "Hosted Solutions is an excellent complement to our existing enterprise service portfolio. For the past decade, they have been delivering highly complex managed hosting solutions to customers of various sizes. In addition, they have a proven track record of growing revenue and generating significant free cash flow."

The new data centers will also mean that Windstream will be able to provide more customers with faster internet speeds.

For more information, check out the LA Time's write up of the acquisition.

Tag: acquisitions windstream hosted solutions data centers

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