Cogeco Communications Inc. announced that their Atlantic Broadband subsidiary has agreed to buy all of the cable systems operating under the MetroCast brand from Harron Communications. Cogeco/Atlantic Broadband will pay $1.4 billion for the assets, which will come via a combination of committed secured debt from two banks and a $315 million equity investment by Caisse de dépôt et placement du Québec (CDPQ). This deal continues a trend of consolidation among North American cable operators.
“The acquisition of the MetroCast cable systems allows Atlantic Broadband to increase its presence in the growing and lucrative U.S. cable market,” said Louis Audet, President and Chief Executive Officer of Cogeco Communications Inc., the parent company of Atlantic Broadband. “The MetroCast systems are a strong strategic fit for Atlantic Broadband. With this acquisition, we are increasing our customer base in attractive markets adjacent to the ones we currently serve. Under the guidance of Atlantic Broadband’s best-in-class management team, we are in a unique position to grow our customer base, revenues and profits.”
“After our highly successful acquisition and integration of the MetroCast Connecticut system almost two years ago, we understand first-hand the sizable residential and business growth potential that we can expect with the remaining MetroCast systems. We have a proven integration plan and a track record of successfully migrating our platforms and service offerings,” said Atlantic Broadband President and Chief Executive Officer, Richard Shea. “These well-maintained systems deliver attractive demographics which make them ideal for our suite of residential video, Internet and telephony services as well as our business services. We look forward to welcoming MetroCast customers and employees to Atlantic Broadband.”
MetroCast’s networks pass 236,000 homes and businesses in New Hampshire, Maine, Pennsylvania, Maryland and Virginia. They serve approximately 120,000 Internet, 76,000 video and 37,000 telephony customers.
Cogeco’s 2012 acquisition of Atlantic Broadband has been successful. But, acquisitions are by their nature dangerous. In 2006, Cogeco acquired Portuguese cable company Cabovisao for C$660-million. After a long string of losses, they sold it in 2012 C$60 million.
For more details on the announcement, see http://corpo.cogeco.com/cca/en/press-room/press-releases/cogeco-communications-inc-announces-atlantic-broadband-will-acquire-all-metrocast-cable-systems/