Alltel buyout

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At least three groups of private-equity buyers have formed to pursue a potential purchase of wireless carrier Alltel Corp., according to people familiar with the matter.

The groups of suitors each have begun a series of meetings with Alltel's management, which has indicated to investors that it is pursuing strategic alternatives.

The phone company, which has a market capitalization of $22.4 billion, is trying to figure out ways to take better advantage of its balance sheet. The company carries about $2.7 billion of long-term debt, a low figure for a company that produces roughly the same amount in cash flow each year. By comparison, rival Sprint Nextel Corp. carries debt of nearly twice its annual cash flow.

But given how Alltel's stock has soared on speculation of a buyout, Verizon has been put off by the high price of a deal, people familiar with the company say. Verizon may not need to make an acquisition anytime soon, since it has been able to expand its wireless business at a faster clip than competitors in recent months.
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