Overbuilder WideOpenWest is stepping up to buy up the cable systems being abandoned by telco SBC Communications.
WOW is paying about $275 million for the 310,000-subscriber operation, which overbuilds conventional MSOs in suburban Chicago, Detroit and parts of Illinois. WOW and SBC would not disclose the terms of the deal, other than to say WOW is paying all in cash and SBS isn't providing any financing.
Ameritech initally built the systems, but when SBC bought that telco Chairman Ed Whitacre put the properties on the block, looking for more than $1 billion.
WOW President Mark Haverkate contended that the Americast systems are in good shape, with basic penetration averaging 25% and plant ready to be equipped for high-speed data and digital cable, services Americast never launched. But WOW won't be building all the towns in which SBC had secured franchises. "There's still some homes under construction that's part of the existing franchises," Haverkate said. "Beyond that, our focus is to keep the customers we have." - John Higgins