p>ATLANTIC TELE-NETWORK $43.57 (Nasdaq symbol ATNI; TSINetwork Rating: Speculative) (340- 777-8000; www.atni.com; Shares outstanding: 15.6 million; Market cap: $676.7 million; Yield: 2.3%) has agreed to sell its Alltel wireless business to AT&T (symbol T on New York) for cash of $780 million. In April 2010, Atlantic bought Alltel from Verizon Wireless for $223 million. AT&T is paying a big premium for Alltel (the sale price amounts to a profit of 250% for Atlantic in under three years) because it not only includes 585,000 subscribers but also considerable wireless spectrum. AT&T needs this spectrum to keep expanding its 4G long-term evolution (LTE) wireless networks. LTE networks are up to five times faster than those in use today, but they use up much more spectrum.
After the sale, Atlantic Tele-Network will still have telecom operations in the U.S. southwest, New England, New York State, Guyana, Bermuda and portions of the Caribbean islands.
The company will also have a very large cash holding, which it could use to make acquisitions or expand its remaining operations. It could also raise its dividend or pay special dividends. The stock currently yields 2.3%.
Atlantic Tele-Network is still a buy.
