Two leading communications companies sign definitive agreement
NuVox Communications and FDN Communications today jointly announced that they have signed a definitiveagreement to merge the two privately held facilities-based communications providers. Following a transition period, the combined company will operate under the name NuVox Communications, and will provide IP-based communications solutions including voice, data connectivity and storage, private networking, web hosting, and security services to business customers across the Southeast and the Midwest. The combined enterprise will initially have more than 90,000 customers, 1 million voice and data lines in service, and annual revenues exceeding $500 million.
“Combining NuVox and FDN Communications makes excellent strategic sense given our similar philosophies about customers—that is, a keen focus on the business market evidenced by our suite of products and services aimed specifically at that market and our unwavering commitment to proficient, ‘high-touch’ customer service,” stated Jim Akerhielm, Chief Executive Officer of NuVox Communications. “The two companies have complementary target customers, overlapping geographic markets in the fast growing Florida and metropolitan Atlanta areas, and efficient, customer-centric operations positioning the new company to be a leading provider of communications solutions for business customers.”
“A larger total footprint and deeper customer penetration in key markets will position NuVox for further growth,” added Mike Gallagher, Chief Executive Officer of FDN Communications. “Both companies have a proven track record and have posted very compelling financial results. Together, the new combined company will build on the strengths and experience of each company.”
The senior management team will be comprised of individuals from both FDN Communications and NuVox. Leading the combined company will be Akerhielm, who will serve as CEO, and Gallagher who will serve as President of Strategic Markets. The board of directors will consist of David Solomon as Chairman of the Board, Akerhielm and Gallagher, Jim Wade and Gillis Cashman of MC Venture Partners, James H. (Jamie) Greene, Jr. of Kohlberg Kravis Roberts and Co. (KKR), Scott Perper of Wachovia Capital Partners, and Jim Fleming of Columbia Capital Partners.
“Both NuVox and FDN Communications have made tremendous investments in technology and the build out of their networks” commented Jamie Greene of KKR. “As a result, they are now able to fully implement Voice over Internet Protocol (VoIP) technology, which is enabling their customers to take advantage of a richer set of communication services and applications as well as significantly enhanced broadband connectivity. In addition to the ability to better leverage each company’s investment in technology and the clear benefits to customers, the combination of the NuVox and FDN networks allows for a number of operational and financial efficiencies which will lead to improved profitability and accelerated growth.”
“We are excited to bring together the superb teams of employees of both companies. I believe the people of both NuVox and FDN Communications are the reason each company has been so successful, and as a combined team, we can achieve even more,” added Akerhielm.
The combined company’s headquarters will be in Greenville, SC with extensive sales, customer, and technical operations in both Greenville, SC and Maitland, FL. The transaction is expected to close in June 2007. Until closing, FDN Communications and NuVox Communications will continue to operate separately. Customers of both companies will not experience changes to their existing service agreements as a result of the merger.
The transaction has been approved by the Boards of Directors of both NuVox and FDN Communications. Financial terms of the proposed merger were not disclosed. The combined company will refinance the existing senior credit facilities of both NuVox and FDN Communications. Completion of the transaction is subject to approval by the stockholders of both companies, as well as regulatory approvals and customary closing conditions.
Certain statements in this release may constitute “forward-looking statements.” When used in this release, words like “may,” “will,” “can,” “should,” “expect,” “anticipate,” “believe,” “project,” or “intend” and other similar expressions are intended to identify forward-looking statements. Statements regarding future events and developments and future performance, as well as our expectations, beliefs, plans, or projections, are forward-looking statements which reflect only our predictions, assumptions, and estimates regarding future events and circumstances. Actual events or results may differ substantially as a result of risks and uncertainties facing us, including those regarding the continued development of the combined company’s business, markets for the combined company’s services and products, continued availability and sufficiency of capital, the risk that the merger will not be completed, the ability of NuVox and FDN Communications successfully to integrate their businesses, the combined company’s degree of financial leverage, the ability to establish and maintain relationships with incumbent local telephone companies and to secure transmission capacity, the impact of competitive services, pricing and alternative technologies, negative economic factors, regulatory requirements and uncertainties, and acquisitions and other strategic investments. The forward-looking statements are based on current expectations as of the date of these statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information, or otherwise.
NuVox delivers customized managed communications services, information technology, data, security, and voice solutions designed specifically for business customers. NuVox serves approximately 90,000 customers in the Southeast and Midwest, and provides select services throughout the United States. NuVox delivers services via its industry-leading MPLS-based wide area private IP network. NuVox has been certified by Cisco and is a member of the Cisco Powered Program for VoxNET, the company's MPLS wide-area networking solution. In addition to retail solutions, NuVox also provides services to government and wholesale customers. For more information, visit www.nuvox.com.
Headquartered in Maitland, Florida, FDN Communications has been providing facilitiesbased, business-class communications services in the Southeastern United States for nearly a decade. Serving tens of thousands of satisfied customers with over a quarter million telephone and Internet lines, FDN presents tailored solutions for today’s communication challenges. To learn more about FDN, visit www.fdn.com.