Broadband provider Great internet, cable, telephone (NYSE: WOW) announced on Wednesday, June 30th, that it has agreed to sell five service areas, including Cleveland and Columbus, in two separate transactions for a total of nearly $ 1.8 billion.
Wow, based in Inglewood, Colorado, Press release It Atlantic broadband broad A cable operator in Quincy, Massachusetts, a Canadian subsidiary Cogeco Communications Inc. (TSE: CCA) has agreed to buy the Cleveland and Columbus area for $ 1.125 billion. Wow’s customers in these regions will be Atlantic Broadband’s customers. Cleveland and Columbus are the only Wow-operated stores in Ohio.
A wow spokesperson didn’t immediately send an email back Wednesday asking for details about the company’s subscriber base in Cleveland and the number of employees here.
Wow also said it sells service areas in Chicago. Evansville, Indiana; Anne Arundel, Maryland donated $ 661 million to Astound Broadband.
“Selling these markets will result in debt while implementing broadband-first strategies, including pursuing edge-out and greenfield strategies and expanding commercial services,” said Teresa Elder, CEO, in a statement. Will be able to be reduced. “
The transaction is expected to close in the second half of this year, subject to regulatory approval. According to Wow, the company’s leverage ratio will be reduced from five to 2.5 as of March 31 due to lower net debt. The company also said it has signed transition service agreements with both buyers to support post-transaction service continuity during the transition period.
“Some employees in each market sold may stay in Wow, some will be integrated into Atlantic Broadband and Astound Broadband, and others will leave the business,” said Wow.
Once both sales are completed, Wow will serve the remaining customer base in 14 service areas in Alabama, Florida, Georgia, Michigan, South Carolina and Tennessee. On a pro forma basis, as of March 31, the company had a total of approximately 532,000 subscribers and 506,000 units generating revenue from high-speed data.
Bloomberg reported that Cogeco said it will be largely funded by new $ 900 million debt in Atlantic and provided by Credit Suisse and Wells Fargo. Credit Suisse advised Cogeco on the transaction and Bank of America advised WideOpenWest.
Cogeco’s share price rose 4.9%, its highest level since January 18. Tim Casey, an analyst at BMO Capital Markets, called the deal “positive” to add a mostly focused broadband customer base, where the pandemic has fueled demand. .. Atlantic Broadband will grow its Internet user base by 38% to 707,000 customers.
Cogeco was Canadian rival Rogers Communications Inc. last year and was the subject of a hostile takeover bid from Altice USA Inc., offering to acquire the company and divide its assets. This move was rejected by the Odette family, who ruled Cogeco. Cogeco said it plans to make the company independent and make further acquisitions.
“The acquisition of Ohio Broadband Systems from WideOpenWest will significantly expand the growing and profitable US broadband business,” said Kojeco CEO Philip Jet in a statement on Wednesday. “This acquisition also illustrates the strong strategic importance of Cogeco Communications to complement Atlantic Broadband’s existing presence and leverage its existing platform.”
Information from Bloomberg was used in this article.
Wow Internet is selling Cleveland, Columbus’ service division, for $ 1.125 billion.
Source link Wow Internet is selling Cleveland, Columbus’ service division, for $ 1.125 billion.
