The Telecommunications Act of 1996 gave way for more competition to enter the cable TV market. Encouraged by this law a number of investors, led by local telephone companies, established competitive broadcast cable services in markets across the country. These entities became known in the industry as 'cable overbuilders,' meaning they would build new cable infrastructure into areas where there were existing cable systems. [ 2 ]
WOW! was founded in November 1999 in Denver, Colorado . After completing a network build in April 2001, WOW! initially served about 200 people in the Denver area. In November 2001, Americast, an overbuild system in the Midwest built and operated by Ameritech New Media, Inc., was purchased by WOW! for an undisclosed amount per subscriber, estimated to have been at a cost of $1,000 per sub. [ 3 ] This purchase opened WOW! to over 310,000 new customers in metropolitan areas surrounding the cities of Chicago , Cleveland , Columbus , Detroit , Denver , and Evansville . [ 4 ] WOW! no longer serves the Denver market.
In August 23, 2011, Wave Broadband and WOW! Internet, Cable, and Phone announced that they entered into an agreement to purchase substantially all of the assets of Broadstripe LLC , a provider of residential and commercial bundled communications services. On January 14, WOW! Internet, Cable and Phone completed the acquisition of Broadstripe's cable systems in Michigan.
In April 2012, WOW! purchased Knology , a broadband company, operating in 13 markets. With the merger the combined customer total will be over 800,000. [ 5 ]
WOW! is privately owned with Avista Capital Partners having a majority stake. [ 6 ]
http://www.businesswire.com/news/home/2012041...Share-Cash
April 18, 2012 09:07 AM Eastern Daylight Time
ENGLEWOOD, Colo. & WEST POINT, Ga.--( BUSINESS WIRE )--WOW! Internet, Cable & Phone (WOW!), a competitive provider of residential and commercial high-speed Internet, cable television and telephone services which is controlled by Avista Capital Partners, and Knology, Inc. (Knology) (Nasdaq: KNOL), today jointly announced a definitive merger agreement under which a subsidiary of WOW! will acquire Knology in an all-cash transaction. Knology is a leading provider of interactive communications and entertainment services in ten markets in the southeastern United States and three markets in the midwestern United States.
“We are proud of our team’s accomplishments over the years, from our company-wide focus on serving our residential and commercial customers to the creation of significant shareholder value. We look forward to working with WOW! to build an even stronger business.”
Under the terms of the agreement, WOW! will acquire all of the outstanding shares of Knology for $19.75 per share in cash, representing a premium of approximately 34% over Knology’s average closing share price during the 3-month period prior to media reports on Knology’s sales process. The total transaction value is approximately $1.5 billion. The Board of Directors of Knology, acting on the unanimous recommendation of a Transaction Committee of the Board, unanimously approved the transaction, which is expected to close after receipt of approval by Knology’s stockholders and satisfaction of customary closing conditions and regulatory approvals. The transaction is not subject to any financing conditions.
“Our two companies have much in common. We share similar beliefs in how employees and customers should be treated, and we both know how to succeed in competitive environments. WOW! and Knology are a natural fit; together, our people, network and operating infrastructure will combine to provide a strong platform for continued growth,” said Colleen Abdoulah, WOW! Chief Executive Officer and Chairwoman of the Board.
“Since its founding in 1995, Knology has been a leader in the communities we serve,” said Knology Chief Executive Officer and Chairman of the Board, Rodger Johnson. “We are proud of our team’s accomplishments over the years, from our company-wide focus on serving our residential and commercial customers to the creation of significant shareholder value. We look forward to working with WOW! to build an even stronger business.”
“We’ve always thought highly of Knology’s operations and innovative thinking, and we believe that our systems are highly complementary. We are very excited about this opportunity to invest in and expand our geographic reach, and we look forward to welcoming Knology’s employees and customers into the WOW! family,” said WOW! President and Chief Financial Officer Steven Cochran.
WOW! operates in Michigan, Illinois, Ohio and Indiana, while Knology serves the southeastern and midwestern United States. The combined entity will have over 800,000 customers, and its products and services will be available to more than 2.8 million households in 13 states.
In connection with the transaction, Credit Suisse and BofA Merrill Lynch acted as the financial advisors to the Transaction Committee of Knology’s Board of Directors and Hogan Lovells US LLP acted as its legal advisor. Alston & Bird LLP acted as legal advisor to Knology. Morgan Stanley acted as sole financial advisor and Kirkland & Ellis LLP acted as legal advisor to WOW!. Credit Suisse, Morgan Stanley, RBC Capital Markets, SunTrust Robinson Humphrey and Bank of Tokyo-Mitsubishi UFJ have provided fully committed debt financing in connection with the transaction.
About Knology, Inc.
Knology, Inc., headquartered in West Point, Georgia, is a leading provider of interactive communications and entertainment services in the Southeast, upper Midwest and Kansas regions. Knology serves both residential and business customers with one of the most technologically advanced broadband networks in the country. Innovative offerings include over 200 channels of digital cable TV, local and long distance digital telephone service with the latest enhanced voice messaging features, and high-speed Internet access, which enables consumers to quickly download video, audio and graphic files using a cable modem. Knology’s fiber-based business products include iPlex, which delivers Ethernet connections to an IP-PBX using Session Initiated Protocol (SIP) technology, Passive Optical Network (PON), which supplies IP architecture with segmented voice and data bandwidth, and Managed Integrated Network Solutions (MATRIX), an integrated IP-based technology which converges data and voice. For more information, please visit www.knology.com .
About WOW! Internet, Cable & Phone
WOW! is a competitive provider of residential and commercial High-Speed Internet, cable television and telephone services. WOW! Cable features a range of services from Basic Cable to advanced services such as Ultra TV, an innovative whole-home gateway solution that combines television and PC entertainment. WOW! Internet provides customers with a choice of High-Speed connections from 2 Mbps all the way to 50Mbps. WOW! Phone offers the convenience of unlimited local and local toll calling, as well as packages that include unlimited nationwide long distance in the United States. Customers can bundle any two or all three services together at a great value, while benefiting from the convenience of dealing with just one company for all their entertainment and telecommunications needs.
About Avista Capital Partners
Avista Capital Partners is a leading private equity firm with over $4 billion under management and offices in New York, Houston and London. Founded in 2005, Avista's strategy is to make controlling or influential minority investments in growth-oriented energy, healthcare, communications & media, industrials, and consumer businesses. Through its team of seasoned investment professionals and industry experts, Avista seeks to partner with exceptional management teams to invest in and add value to well-positioned businesses. For more information visit www.avistacap.com .
