June 10, 2009 / 4:03 PM / 9 years ago

UPDATE 1-Raymond James ups price target on Atlantic Tele-Net

June 10 (Reuters) - Raymond James raised its price target on Atlantic Tele-Network Inc (ATNI.O) by $13 to $47 and maintained its “strong buy” rating, after the company said it would buy certain wireless assets of Verizon Wireless.

Shares of the telecommunications services provider surged as much as 48 percent to a lifetime high.

The brokerage said ATN’s deal with Verizon, which is expected to add over 800,000 new subscribers, would make the company one of the larger wireless carriers in the United States.

ATN would have more subscribers than NTELOS Holdings Corp NTLS.O, iPCS Inc IPCS.O and Shenandoah Telecommunications Co (SHEN.O), Raymond James said.

“While there are risks to this acquisition given ATN’s inexperience with retail operations in the U.S., the bargain price ATN is paying for these assets makes this an opportunity far outweighing the risks,” analyst Ric Prentiss wrote in a note to clients.

On Tuesday, ATN agreed to buy certain assets of Verizon Wireless, a venture of Verizon Communications (VZ.N) and Vodafone Group Plc (VOD.L), for $200 million in cash. [ID:nWNAB7964]

ATN also said it expects to have more than 1 million retail wireless subscribers, including international operations, after the close of the deal.

Last month, AT&T Inc (T.N) said it would buy the bulk of Alltel Wireless assets being divested by Verizon for $2.35 billion. [ID:nN08498235]

ATN shares touched a high of $39.36 but pared some gains to trade up $10.55 at $37.20 Wednesday morning, making them the second biggest percentage gainer on Nasdaq. (Reporting by Deepti Govind in Bangalore; Editing by Deepak Kannan)

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