ABRY Closes $15-Per-Share RCN Takeover

ABRY Partners now owns RCN Corp. and fiber broadband services provider RCN Metro.

Kelly Teal, Contributing Editor

August 27, 2010

2 Min Read
ABRY Closes $15-Per-Share RCN Takeover

Private equity firm ABRY Partners has completed its $1.2 billion takeover of cable operator RCN Corp. and, consequently, fiber broadband services provider RCN Metro.

And perhaps now, with new investor backing, RCN will try once again to consolidate the fiber sector. RCN in 2009 tried to outbid Zayo Group for FiberNet but later bowed out of the proceedings. Certainly the fiber field is rife with M&A as data consumption and wireless backhaul fuel bandwidth demand: The latest deal surfaced yesterday, with Court Square Capital Partners buying Fibertech Networks. Meanwhile, Windstream is purchasing Kentucky Data Link and Norlight as it expands beyond its traditional rural landline focus; nTelos is buying FiberNet from One Communications; and Zayo recently snapped up American Fiber Systems.

The RCN deal was announced in early March and called for RCN investors to receive $15 in cash for each RCN share they own, as well as for ABRY to assume about $630 million of RCN debt. RCN, which stopped holding earnings conference calls once the transaction became public, soon will de-list from the NASDAQ Global Select Market.

Other changes also are in store. For example, the video, high-speed Internet and premium voice services business, which used to be part of RCNs residential and small business segment, will operate as a standalone unit. Jim Holanda will serve as CEO while Steve Simmons will act as company chairman. Both men come from Patriot Media and Choice Cable TV of Puerto Rico.

Meanwhile, Mike Sicoli will become CEO of RCN Metro. Sicoli had been executive vice president and CFO of RCN Corp.

Separating RCN Metro will help us realize the full potential of our business through dedicated investments in our network and focused resources serving our carrier and enterprise customers,” Sicoli said in a press release.

ABRY specializes in media and telecom deals. Its previous holdings include Billing Services Group and Oregon-based CLEC Integra Telecom. Current investments include Atlantic Broadband and Grande Communications, a CLEC in Texas.

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About the Author(s)

Kelly Teal

Contributing Editor, Channel Futures

Kelly Teal has more than 20 years’ experience as a journalist, editor and analyst, with longtime expertise in the indirect channel. She worked on the Channel Partners magazine staff for 11 years. Kelly now is principal of Kreativ Energy LLC.

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