AirGate PCS, a Sprint PCS Network Partner serving Southeast America, and iPCS, Inc., a privately held Sprint PCS Network Partner serving the American Midwest, have announced an agreement under which AirGate and iPCS will combine in a tax-free, stock for stock transaction for 13.5 million shares of AirGate common stock.
Under the terms of the transaction, AirGate will issue approximately 12.4 million shares of AirGate common stock. AirGate will hold in reserve an additional 1.1 million shares for issuance upon the exercise of outstanding iPCS options and warrants.
Assuming the full conversion of each company’s options and warrants, AirGate’s shareholders will own 52.5 percent of the combined company, and iPCS’ shareholders will own 47.5 percent. The combination will be accounted for as a purchase.
Upon completion of the transaction, iPCS will become a wholly owned subsidiary of AirGate.
The transaction is subject to customary regulatory review and approvals by the shareholders of AirGate, both companies’ senior secured lenders, and Sprint PCS.
A majority of the shareholders of iPCS have agreed to vote their shares in favour of the merger. The transaction is expected to close by the end of February 2002.