Wave Broadband is joining RCN and Grande Communications under the ownership of global private equity firm TPG Capital to create the country's sixth largest cable operator. TPG is providing the financial backing for the $2.36 billion acquisition of Wave. The transaction is expected to close in the second half of 2017 and is subject to customary closing conditions, including regulatory approvals.
TPG closed on its acquisition of RCN and Grande Communications in February. The combined cable operation serves the East Coast, Chicago and Texas. The addition of Wave adds markets in the northwest and on the West Coast. Wave itself recently bought CascadeLink in Seattle, as well as Cascade Networks, which operates in the greater Longview, WA, and Clatskanie, OR, areas. Wave has also been gathering financing to expand its fiber networks.
The combination of RCN (including Grande) and Wave is intended to establish a diversified network across seven of the top 10 U.S. cities. RCN's primary service areas include Boston, Chicago, Lehigh Valley (PA), New York City, Philadelphia (Delaware County) and Washington, DC. Grande serves the Texas cities of Austin, San Antonio, Dallas, San Marcos, Waco, Temple, Corpus Christi, Midland and Odessa. Wave operates mainly on the West Coast, including the Seattle and San Francisco areas, among others.
"RCN, together with Grande and Wave, has tremendous growth potential with the combined company. We will continue to enhance broadband, entertainment and communication solutions that focus on providing high-quality, reliable services along with best-in-class customer service to both business and residential customers," said Jim Holanda, CEO of RCN and Grande. "This acquisition expands the breadth and depth of RCN's fiber rich network to 17,000 miles serving 2.7 million homes passed with over 925,000 residential and business customers delivering close to 1.7 million data, voice and video services. The combined companies will continue to provide customers top-rated and award-winning options at a time when consumer trends and business needs are evolving at an astounding rate."
Chairman Steve Simmons and CEO Holanda, along with the existing senior executive team, will lead the new combined entity.
"We are excited that our new partners in TPG and RCN recognize the value of what we have created at Wave, and share our passion for creating happy customers - we are eager to enter our next era of growth alongside them," said Steve Weed, founder and CEO of Wave. "Over the last several years we have accelerated our growth substantially by expanding from our heritage of residential broadband services into enterprise grade fiber," added Weed.
Wave, RCN and Grande have all deployed gigabit Internet services recently. Wave and Grande have mostly deployed fiber-to-the-home (FTTH), while RCN has largely focused on DOCSIS 3.1.