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LITTLE ROCK, Ark. — Windstream Corp., a phone company spun off from Alltel Corp. with service in New Mexico, has announced it will buy CT Communications Inc., a small telecom in North Carolina, for $585 million in cash.

The deal will give Windstream an additional 158,000 access lines and 29,000 broadband customers.

Windstream shares rose 11 cents, to $15.03, in midday trading Tuesday, while CT Communications shares surged $9.62, or 45 percent, to $31.20. Earlier in the session, CT Communications shares hit a new high of $31.44, topping its previous 52-week high of $26.85.

Windstream was created last year when Alltel combined its landline phone business with Valor Communications Group Inc. in a $4.9 billion deal.

Windstream will add CT Communications' territory to a coverage area that spans 16 states, from New Mexico to Florida to New York. With the acquisition, Windstream says it will have 3.4 million access lines and 744,000 broadband customers. CT Communications has broadband available for 95 percent of its lines.

The acquisition places continued emphasis by Windstream on serving rural areas.

Windstream is to pay $31.50 per share for the company, a 31 percent premium from CT Communications' previous 30-day close. The transaction is expected to close in the second half of 2007. The deal is subject to regulatory approval from federal and state agencies.

A news release from Windstream says the company plans to finance the acquisition with debt and existing cash.