Wow buying cable co. Knology for $750.5 million

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Wow Internet, Cable & Phone is buying cable TV and Internet provider Knology Inc. for $750.5 million, partly to broaden its geographic reach.

Knology shares gained $1.27, or 7 percent, to $19.32 in morning trading.

Wow, which is owned by private equity firm Avista Capital Partners, offers cable TV, Internet and telephone services in Michigan, Illinois, Ohio and Indiana. Knology serves the Southeastern and Midwest U.S.

In February Knology shares spiked after a report said the company was shopping itself to potential buyers.

Wow and Knology are a “natural fit,” said Wow CEO Colleen Abdoulah said in a statement. She said that the two companies’ networks and infrastructure will aid growth.

The combined company would have more than 800,000 customers.

Wow is paying $19.75 per share, a 9 percent premium to Knology’s Tuesday closing price of $18.05. West Point, Ga.-based Knology has about 38 million outstanding shares, according to FactSet, and about $752 million in debt at the end of 2011. The companies value the total deal at approximately $1.5 billion.

Knology’s board unanimously approved the buyout, which is expected to close following regulatory and shareholder approval.