Frontier Communications has entered into a definitive agreement to sell its operations and all associated assets in Washington, Oregon, Idaho and Montana to WaveDivision Capital (WDC), in partnership with Searchlight Capital Partners, for USD1.352 billion in cash, subject to certain closing adjustments. WDC, is headed by broadband entrepreneur Steve Weed, the founder and former CEO of regional cable operator Wave Broadband. Frontier will continue to operate the business and serve customers with existing products and services until the transaction closes. For their part, WDC and Searchlight have formed a new company to operate the business and honour existing customer commitments and contracts after the transaction closes.
In operational terms, Frontier’s operations in these states serve more than 350,000 residential and commercial customers as of 31 March 2019 and accounted for USD619 million of revenue, USD46 million of net income and USD272 million of adjusted EBITDA for the twelve months ended 31 March 2019. Across the four states, Frontier’s network passes 1.7 million residential and business locations, of which approximately 500,000 are fibre-to-the-premises (FTTP) capable.
The transaction is subject to regulatory approvals by the Federal Communications Commission, the US Department of Justice (DoJ), the Committee on Foreign Investment in the United States (CFIUS), applicable state regulatory agencies, and certain local video franchise authorities.