Mega Broadband Investments Holdings LLC (MBI) and Cable One, Inc. (NYSE: CABO) (“Cable One”) have announced an agreement that, when consummated, will see Cable One buy a 45% minority stake in MBI from affiliates of private equity firm GTCR LLC for approximately $574.1 million in cash. Cable One also will have the right to purchase the rest of MBI at a predetermined multiple of earnings beginning in 2023. MBI owns Vyve Broadband.
The purchase price, which Cable One will pay via cash on hand is subject to adjustment for certain new debt incurrences and transaction expenses. The deal is expected to be completed during the fourth quarter of 2020.
MBI was formed through the acquisitions of Vyve Broadband, Northland Communications, and the broadband assets of Eagle Communications. Now operating under the Vyve Broadband brand, the company offers triple-play broadband services to residential and business customers in rural markets across Alabama, Arkansas, California, Colorado, Georgia, Idaho, Kansas, Louisiana, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Washington, and Wyoming. Vyve operates 15,800 network plant miles, including more than 4,100 fiber route miles; its infrastructure passes approximately 630,000 homes.
Cable One serves more than 900,000 residential and business broadband customers in 21 states via its Sparklight and Clearwave brands. “This strategic investment in MBI reflects a continuation of our commitment to provide rural America with reliable high-speed internet service,” said Julie Laulis, president and CEO of Cable One. “MBI has developed an excellent network in geographies complementary to our existing footprint and we are excited to share in its future growth. MBI’s operating model and local-first focus mirrors our own and we are pleased to partner with MBI.”
“This transaction represents the next step of MBI’s ongoing transformation, and I am excited to have the backing of Cable One alongside GTCR,” added Phil Spencer, CEO of MBI. “Over the last few years our team has invested significant capital to upgrade our networks, roll out Gigabit internet service, and enhance business services across our footprint. Under our new partnership, we plan to continue making significant investments in our network, our communities, and our employees.”
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