Verizon Wireless (VZ), the No. 2 U.S. wireless service, said on Monday it would buy Rural Cellular Corp (RCCC) for $757 million in cash to save on roaming costs and expand its customer base.

Verizon Wireless, a venture of Verizon Communications and Vodafone Group Plc (VOD), said Rural Cellular shareholders would receive $45 per share in cash, a 16 percent premium to the average closing price for the last 10 trading days and 41 percent above Friday's close of $31.88.

The deal is worth $2.67 billion including the assumption of net debt, according to Verizon Wireless. It said it expects more than $1 billion in savings from reduced roaming fees and operating expenses as a result of the deal.

Verizon Wireless said the acquisition, which it expects to close in the first half of 2008, would increase its customer base by more than 700,000 subscribers.

Rural Cellular was advised on the deal by Bear Stearns (BSC), Skadden Arps Slate Meagher & Flom LLP and Falkenberg Capital. Verizon Wireless was advised by JPMorgan Chase & Co. and Debevoise & Plimpton LLP.