Puerto Rican cableco Liberty Cablevision has entered into an agreement to acquire another of the island’s triple-play cable network operators, OneLink Communications, in a deal which values the target company at approximately USD585 million. Cablevision’s US-based parent Liberty Global (LGI) has entered into a partnership with private investment fund manager Searchlight Capital Partners, via its subsidiary LGI Broadband Operations, to acquire 100% of San Juan Cable (trading as OneLink Communications). If the offer receives regulatory approval, a new company will be formed, to which LGI will contribute its 100% interest in Cablevision and Searchlight will contribute cash, before in turn acquiring OneLink. Upon completion of the transaction, expected in the fourth quarter of this year, the combined business will be 60%-owned by LGI and 40%-owned by Searchlight. LGI will control the newly-formed company and will consolidate the business for financial reporting purposes.
At 31 March 2012 OneLink passed 347,000 homes and served approximately 262,500 TV, internet and voice revenue generating units (RGUs). Mike Fries, CEO of LGI, stated: ‘Consistent with our strategy of consolidating markets within our footprint, this transaction will make us the leading provider of cable services in Puerto Rico, passing approximately 70% of the cable homes on the island… on a combined basis, we will have approximately 700,000 homes passed and 480,000 RGUs, generating nearly USD300 million in pro forma 2011 revenue.’ LGI’s partner in the venture, Searchlight, is a private investor in a wide range of industries in North America and Europe, and has offices in New York, London and Toronto.
TeleGeography’s GlobalComms Database says that OneLink was bought for USD520 million in October 2005 by a 50/50 private equity venture between New York-based MidOcean Partners and Crestview Partners, who acquired the firm from Adelphia Communications and ML Media Partners. OneLink offers CATV in San Juan and the neighbouring areas of Guaynabo, Carolina, Trujillo Alto, Bayamon, Catano, Toa Baja and Toa Alta, making it the largest provider of CATV services in Puerto Rico, but it was slower than Cablevision to upgrade to advanced broadband services. In late 2009 OneLink belatedly completed a triple-play range over the same cable when it launched a full digital telephony service on its HFC network. Cablevision provides triple-play TV, broadband internet and VoIP telephony services over its 100% digital network in east, central and northern municipalities of Puerto Rico, excluding the capital. Cablevision is currently the island’s second largest cable TV service provider, but is the market’s biggest cable broadband provider by subscribers. A third regional operator, Choice Cable TV is the CATV provider for 31 municipalities in southern, western and north-western areas of Puerto Rico.