CHICAGO, Feb. 26, 2013 /PRNewswire/ -- Telephone and Data
Systems, Inc. [NYSE: TDS], parent company to TDS Telecommunications
Corp. (TDS Telecom), today announced an agreement to acquire
substantially all of the assets of Baja Broadband, LLC ("Baja"), a
cable company headquartered in Alamogordo, New Mexico, for a purchase price
of $267.5 million, subject to working
capital and other adjustments. Baja generated annual revenues of
$82.4 million in 2012, and has
approximately 285 employees. The transaction is expected to close
in the third quarter of 2013, pending regulatory approvals.
Baja Broadband is a full-service communications company,
providing video, high-speed broadband and voice services to
residential and commercial customers in Colorado, New
Mexico, Texas and
Utah.
"Baja Broadband is a natural extension of our existing
businesses, with significant potential to deliver increased returns
over time," said David A. Wittwer,
president and CEO, TDS Telecom. "Our strategy is to leverage our
expertise and existing platform and technologies to accelerate
growth in underserved, high-potential markets. We plan to build on
Baja's solid customer base and upgraded network to increase
penetration and revenues with new services and products and
outstanding customer experiences. And our experience with
commercial customers will enable us to target new services and
products to this fast-growing sector in Baja's service areas."
As of Dec. 31, 2012, Baja passed
approximately 212,000 homes, with approximately 74,000 video
subscribers, 56,000 high-speed broadband subscribers and 15,000
digital voice subscribers. Approximately 96 percent of Baja's
network is equipped to deliver high-speed, high-capacity broadband
and video services.
"Baja's strong network capabilities will enable us to deliver
highly competitive data services, while reducing the need for
future capital investment," added Wittwer.
"Each of our team members has contributed to developing Baja
Broadband into a leading communications operator," said
Peter Kahelin, CEO, Baja Broadband. "TDS Telecom's focus on quality,
integrity and outstanding service will enhance our already strong
relationships with our customers, our employees and our
communities."
"This acquisition is an important step in our ongoing efforts to
build value over the long term," said LeRoy
T. Carlson, Jr., president and CEO, Telephone and Data
Systems. "We continue to seek opportunities to invest our resources
where we believe they can deliver strong returns over time, and
expand into adjacent businesses like cable and hosted and managed
services that enable us to leverage our core competencies to
support our strategy to grow profitably."
RBC Capital Markets served as the exclusive M&A advisor to
Baja in connection with this transaction. Edwards Wildman Palmer
LLP served as legal counsel to Baja.
About Telephone and Data Systems
Telephone and Data
Systems, Inc. (TDS), a Fortune 500® company, provides wireless;
broadband, TV and voice; and hosted and managed services to
approximately 7 million customers in 36 states through its business
units, U.S. Cellular, TDS Telecom and TDS Hosted & Managed
Services. Founded in 1969 and headquartered in Chicago, TDS employed 12,300 people as of
Dec. 31, 2012. Visit teldta.com for
comprehensive financial information, including earnings releases,
quarterly and annual filings, shareholder information and more.
About TDS Telecommunications Corp.
TDS
Telecommunications Corp. is the seventh largest local exchange
telephone company in the U.S. Headquartered in Madison, Wis., it is a wholly owned subsidiary
of Telephone and Data Systems, Inc. For 44 years, the company has
been connecting people with high-speed Internet, phone, and TV
entertainment services in over a hundred rural, suburban, and
metropolitan communities across 32 states. Today, TDS has nearly 1
million customer connections in service and 2,900 employees.
Business customers select from the latest technologies, including:
VoIP (managedIP Hosted) phone service, dedicated high-speed
Internet and hosted-managed services. Visit tdstelecom.com or
tdsbusiness.com for more information.
About Baja Broadband
Baja Broadband is a full-service
communications company offering best-in-class residential and
commercial video, high-speed internet, and voice services. Baja is
committed to being the leading provider of entertainment,
information, and communication services in the communities it
serves. Baja owns and operates broadband networks in communities
within Colorado, New Mexico, Texas and Utah. Visit bajabroadband.com for more
information.
Baja is currently owned by M/C Partners, a leading private
equity firm focused on communications, media and information
technology; and Columbia Capital, a premier investment firm in
wireless, broadband, media and enterprise technology. Visit
mcpartners.com and colcap.com to learn more. Baja is currently
managed by Last Mile Communications, an international management
partnering and telecommunications consulting firm. Visit
lastmile.net for more information.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995: All information set forth in this news
release, except historical and factual information, represents
forward-looking statements. This includes all statements about the
company's plans, beliefs, estimates and expectations. These
statements are based on current estimates, projections and
assumptions, which involve certain risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements. Important factors that may affect these
forward-looking statements include, but are not limited to: impacts
of pending acquisition and divestiture transactions, including, but
not limited to, the ability to obtain regulatory approval,
successfully complete the transaction and the financial impacts of
such transaction; the ability of the company to successfully manage
and grow its markets; the overall economy; competition; the access
to and pricing of unbundled network elements; the ability to obtain
or maintain roaming arrangements with other carriers on acceptable
terms; the state and federal telecommunications regulatory
environment; the value of assets and investments; adverse changes
in the ratings afforded TDS and U.S. Cellular debt securities by
accredited ratings organizations; industry consolidation; advances
in telecommunications technology; uncertainty of access to the
capital markets; pending and future litigation; changes in income
tax rates, laws, regulations or rulings; acquisitions/divestitures
of properties and/or licenses; and changes in customer growth
rates, average monthly revenue per user, churn rates, roaming
revenue and terms, the availability of handset devices, or the mix
of products and services offered by U.S. Cellular and TDS Telecom.
Investors are encouraged to consider these and other risks and
uncertainties that are discussed in the Form 8-K Current Report
used by TDS to furnish this press release to the Securities and
Exchange Commission ("SEC"), which are incorporated by reference
herein.
SOURCE Telephone and Data Systems, Inc.
