Windstream's board of directors has given its thumbs up for the company to proceed with the tax-free spinoff of its telecom assets into its real estate investment trust (REIT) Communications Sales & Leasing (CS&L).
In tandem with approving the REIT, the telco's board declared a prorated cash dividend subject to the closing of the spinoff.
On April 24, the service provider expects to distribute about 80.1 percent of CS&L shares to Windstream shareholders of record. To distribute the shares, the company has to satisfy a number of customary closing conditions, including financing the transaction.
The service provider said that it plans to use about 19.9 percent retained CS&L shares during the 12-month period following the spinoff to reduce overall debt.
Windstream also will make a cash distribution equivalent to a prorated 25 cents quarterly dividend to Windstream shareholders of record as of 5 p.m. EDT on April 10. If the spinoff occurs on April 24 as planned, the cash dividend would be $0.0659, and the company would expect to make the payment on April 24.
After the spinoff is completed, Windstream will continue to be listed on the Nasdaq stock exchange under the "WIN" symbol, while CS&L expects to list its common stock on Nasdaq under the symbol "CSAL." Nasdaq has approved the listing of CS&L's common stock, subject to official notice of issuance.
Leading up CS&L will be Kenny Gunderman, a banking executive who came to the company from Stephens Inc., where he served as executive vice president and co-head of investment banking.
- see the release
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