Centel
Encyclopedia
Centel Corporation was an American telecommunications company, with primary interests in providing basic telephone service, cellular phone service and cable television service. It was founded in 1900 as an electric company.
Its basic telephone service was generally known as Central Telephone Company
. Its largest coverage areas by lines installed were Las Vegas, two Chicago suburbs (Des Plaines and Park Ridge), Tallahassee, FL and Charlottesville, VA. It was, until the breakup of AT&T
in 1984, the fifth largest telephone company in the United States after AT&T
, GTE
, United Telecom
and Contel
.
Centel was purchased by Sprint
in 1993 for approximately $3 billion in Sprint common stock. Centel's stock was trading at $42.50 per share on the New York Stock Exchange just before the merger announcement in May 1992, but the cash value of the deal (commonly referred to as a "takeunder") worked out to be only $33.50 per share of Centel stock. After a bitter battle with dissident shareholders who believed the company was worth more, the merger was ultimately approved by a very narrow majority with 50.5% of the outstanding shares voting for the merger.
Centel had consolidated revenues of $1.2 billion in 1991.
At the time of its 1993 purchase by Sprint, Centel provided local telephone service to 1.5 million telephone lines in seven states and was also the 10th largest cellular company with operations in 22 states. It had 9,300 employees. It had previously sold its Cable Operations in 1989 and its Electric operations in 1991.
Ironically, Sprint didn't end up keeping either of Centel's businesses (cellular and local telephone service) that it acquired. The cellular operations were spun off in 1996 so Sprint could instead focus on providing Sprint PCS cellular service. The local telephone operations were spun off (after being combined with Sprint's own local telephone operations) in 2006 (see below).
Its basic telephone service was generally known as Central Telephone Company
Central Telephone
Central Telephone Company is a telephone operating company owned by CenturyLink that provides local telephone service in Nevada and North Carolina....
. Its largest coverage areas by lines installed were Las Vegas, two Chicago suburbs (Des Plaines and Park Ridge), Tallahassee, FL and Charlottesville, VA. It was, until the breakup of AT&T
AT&T
AT&T Inc. is an American multinational telecommunications corporation headquartered in Whitacre Tower, Dallas, Texas, United States. It is the largest provider of mobile telephony and fixed telephony in the United States, and is also a provider of broadband and subscription television services...
in 1984, the fifth largest telephone company in the United States after AT&T
AT&T
AT&T Inc. is an American multinational telecommunications corporation headquartered in Whitacre Tower, Dallas, Texas, United States. It is the largest provider of mobile telephony and fixed telephony in the United States, and is also a provider of broadband and subscription television services...
, GTE
GTE
GTE Corporation, formerly General Telephone & Electronics Corporation was the largest independent telephone company in the United States during the days of the Bell System....
, United Telecom
United Telecommunications
United Telecommunications was the predecessor company of two United States telecommunications companies:*Sprint Nextel, a mobile telecommunications company based in Overland Park, Kansas...
and Contel
Contel
ConTel Corporation was the third largest independent phone company in the United States prior to the 1996 telecom deregulation. It was acquired by GTE in 1991.-Early 20th Century:...
.
Centel was purchased by Sprint
Sprint Nextel
Sprint Nextel Corporation is an American telecommunications company based in Overland Park, Kansas. The company owns and operates Sprint, the third largest wireless telecommunications network in the United States, with 53.4 million customers, behind Verizon Wireless and AT&T Mobility...
in 1993 for approximately $3 billion in Sprint common stock. Centel's stock was trading at $42.50 per share on the New York Stock Exchange just before the merger announcement in May 1992, but the cash value of the deal (commonly referred to as a "takeunder") worked out to be only $33.50 per share of Centel stock. After a bitter battle with dissident shareholders who believed the company was worth more, the merger was ultimately approved by a very narrow majority with 50.5% of the outstanding shares voting for the merger.
Centel had consolidated revenues of $1.2 billion in 1991.
At the time of its 1993 purchase by Sprint, Centel provided local telephone service to 1.5 million telephone lines in seven states and was also the 10th largest cellular company with operations in 22 states. It had 9,300 employees. It had previously sold its Cable Operations in 1989 and its Electric operations in 1991.
Ironically, Sprint didn't end up keeping either of Centel's businesses (cellular and local telephone service) that it acquired. The cellular operations were spun off in 1996 so Sprint could instead focus on providing Sprint PCS cellular service. The local telephone operations were spun off (after being combined with Sprint's own local telephone operations) in 2006 (see below).
Former Subsidiaries
- Central Telephone Company: In 2006, Sprint spun off the former Centel telephone subsidiaries (which Sprint merged with its own United Telephone operations) as part of the formation of EmbarqEmbarqEmbarq Corporation was the largest independent local exchange carrier in the United States , serving customers in 18 states and providing local, long distance, high-speed data and wireless services to residential and business customers...
. EmbarqEmbarqEmbarq Corporation was the largest independent local exchange carrier in the United States , serving customers in 18 states and providing local, long distance, high-speed data and wireless services to residential and business customers...
was acquired by CenturyTel (now CenturyLinkCenturyLinkCenturyLink, Inc. is a United States telecommunications firm, headquartered in Monroe, Louisiana. The company, founded as Central Telephone & Electronics Corporation in 1968, later changed its name to Century Telephone Enterprises, Inc. in 1971, and then was called CenturyTel, Inc. from 1999 to 2010...
) in 2009. Central TelephoneCentral TelephoneCentral Telephone Company is a telephone operating company owned by CenturyLink that provides local telephone service in Nevada and North Carolina....
, Central Telephone Company of VirginiaCentral Telephone Company of VirginiaCentral Telephone Company of Virginia is a telephone company owned by CenturyLink that provides local telephone service within the commonwealth of Virginia....
, and Central Telephone Company of TexasCentral Telephone Company of TexasCentral Telephone Company of Texas is a telephone operating company owned by CenturyLink that provides local telephone service in Texas. The company serves communities in Texas such as Killeen, Copperas Cove, and Cranfills Gap....
are still active CenturyLinkCenturyLinkCenturyLink, Inc. is a United States telecommunications firm, headquartered in Monroe, Louisiana. The company, founded as Central Telephone & Electronics Corporation in 1968, later changed its name to Century Telephone Enterprises, Inc. in 1971, and then was called CenturyTel, Inc. from 1999 to 2010...
subsidiaries.- Earlier, in 1997, Sprint sold the Chicago area phone operations (Des Plaines and Park Ridge) to AmeritechAmeritechAT&T Teleholdings, Inc., formerly known as Ameritech Corporation , was a U.S. telecommunications company that arose out of the 1984 AT&T divestiture. Ameritech was one of the seven Regional Bell Operating Companies that was created following the breakup of the Bell System...
(now AT&TAT&TAT&T Inc. is an American multinational telecommunications corporation headquartered in Whitacre Tower, Dallas, Texas, United States. It is the largest provider of mobile telephony and fixed telephony in the United States, and is also a provider of broadband and subscription television services...
).
- Earlier, in 1997, Sprint sold the Chicago area phone operations (Des Plaines and Park Ridge) to Ameritech
- Centel Cellular Company: In 1993, Centel Cellular Company changed its name to Sprint Cellular Company when Sprint acquired Centel. It was subsequently spun off as 360 Communications Company in 1996. AlltelAlltelAlltel Corporation is a wireless service provider, primarily based in the United States. Before an acquisition by Verizon Wireless, it served 34 states. After the merger, Alltel continues to serve six states, mostly in rural areas...
acquired 360 Communications Company in 1998 for $4.1 billion. Verizon WirelessVerizon WirelessCellco Partnership, doing business as Verizon Wireless, is one of the largest mobile network operators in the United States. The network has 107.7 million subscribers as of 2011, making it the largest wireless service provider in America....
acquired AlltelAlltelAlltel Corporation is a wireless service provider, primarily based in the United States. Before an acquisition by Verizon Wireless, it served 34 states. After the merger, Alltel continues to serve six states, mostly in rural areas...
in 2008.
- Centel Cable Television (was the nation's 22nd largest cable company): In 1989, Centel sold all of its cable operations in 6 separate transactions. Southeast Florida operations were sold to Adelphia Communications (then taken over by ComcastComcastComcast Corporation is the largest cable operator, home Internet service provider, and fourth largest home telephone service provider in the United States, providing cable television, broadband Internet, and telephone service to both residential and commercial customers in 39 states and the...
), Ohio operations to Warner Cable (now Time Warner CableTime Warner CableTime Warner Cable is an American cable television company that operates in 28 states and has 31 operating divisions...
), Central Florida operations to American Television and Communications Corporation (a subsidiary of Time Inc.Time Inc.Time Inc. is a subsidiary of the media conglomerate Time Warner, the company formed by the 1990 merger of the original Time Inc. and Warner Communications. It publishes 130 magazines, most notably its namesake, Time...
, now Time Warner CableTime Warner CableTime Warner Cable is an American cable television company that operates in 28 states and has 31 operating divisions...
, later to be spun off as Bright House NetworksBright House NetworksBright House Networks is a cable television company, the seventh largest cable operator and the sixth largest traditional multiple system operator in the United States owned by Advance/Newhouse, headquartered in Syracuse, New York...
), Kentucky operations to Simmons Communications (later to Frontiervision, then Adelphia, then Time Warner CableTime Warner CableTime Warner Cable is an American cable television company that operates in 28 states and has 31 operating divisions...
), Michigan operations to C-TEC (later Michigan Cable, then Avalon Cable, then Charter CommunicationsCharter CommunicationsCharter Communications is an American company providing cable television, high-speed Internet, and telephone services to more than 4.7 million customers in 25 states. By revenues, it is the fourth-largest cable operator in the United States, behind Comcast, Time Warner Cable, and Cox Communications...
) and Illinois operations to Jones IntercableJONES IntercableJones Intercable was a cable television company founded by Glenn Jones in 1970. Jones, already a cable television veteran, had bought his first cable system in Georgetown, Colorado after taking a $400 loan on his Volkswagen....
(then taken over by ComcastComcastComcast Corporation is the largest cable operator, home Internet service provider, and fourth largest home telephone service provider in the United States, providing cable television, broadband Internet, and telephone service to both residential and commercial customers in 39 states and the...
) for a combined total of $1.4 billion. The price yielded a net gain of over $500 million to Centel.
- Centel Electric: In 1991, Centel sold its electric utility holdings in Kansas and Colorado to UtiliCorp (later known as Aquila, Inc.Aquila, Inc.Aquila, Inc. was an electricity and natural gas distribution network headquartered in Kansas City, Missouri in the United States. The company also owned and operated power generation assets...
) for $345 million. In 2006, Aquila sold the Kansas electric properties to Mid-Kansas Electric Company (a cooperative). In 2008, the Colorado electric properties were acquired by Black Hills CorporationBlack Hills CorporationBlack Hills Corporation is a Rapid City, South Dakota diversified energy company that is an electric and gas utility in South Dakota and Wyoming and sells power throughout the American West....
.