Largest acquisition in company’s history completed, transition underway.
MADISON, WIS. (Aug. 2, 2013)—TDS Telecommunications Corp. (TDS Telecom), subsidiary of Telephone and Data Systems, Inc. [NYSE: TDS], announces the final purchase of 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. The purchase was finalized on Aug. 1, 2013.
In February, Telephone and Data Systems announced their intention to acquire Baja Broadband pending regulatory approvals, which have been received. TDS Telecom will manage the operations of Baja Broadband. In preparation for the announcement, TDS Telecom executives and staff members visited each Baja site on Thursday to welcome employees to the TDS family.
“Spirits are high and we are feeling confident the transition will be successful,” states Mark Barber, vice president of Cable Operations for TDS Telecom. “The transition team has been working around the clock to prepare both organizations for the change. Our goal is to make no impact on customer operations and to support Baja employees, as well as TDS employees, as they work together to meet the needs of customers today and to expand services in the future.”
In 2012, Baja reported annual revenues of $85.6 million. The company has 278 employees. Baja Broadband is a full-service communications company, providing video, high-speed broadband and voice services to residential customers and businesses in Arizona, Colorado, Nevada, New Mexico, Texas, and Utah.
“This is our largest acquisition to date and we are well positioned to drive growth going forward. I believe Baja Broadband has significant potential to deliver increased returns over time,” said David A. Wittwer, president and CEO, TDS Telecommunications Corp. “Our strategy is to leverage our expertise and technologies to accelerate growth in underserved, high-potential markets.”
The company’s experience with commercial customers will also enable them to target new services, including managedIP Hosted to this fast-growing sector in Baja’s service areas. As of June 30, 2013, Baja passed more than 214,000 homes, with approximately 71,000 video subscribers, 59,000 high-speed broadband subscribers and 16,000 digital voice subscribers. Approximately 96 percent of Baja’s network is equipped to deliver high-speed, high-capacity broadband and video services.
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.