Time Warner Cable spends US$600m on fibre operator

Time Warner Cable (TWC) has agreed a US$600m deal to acquire Dukenet Communications, which owns and operates an 8,700 mile fibre optic network.
The US’ second largest cable operator is acquiring Dukenet from utilities company Duke Energy and…

Time Warner Cable (TWC) has agreed a US$600m deal to acquire Dukenet Communications, which owns and operates an 8,700 mile fibre optic network.

The US’ second largest cable operator is acquiring Dukenet from utilities company Duke Energy and infrastructure investment firm Alinda Capital Partners, which own the target 50/50.

TWC is using to cash on hand to fund the deal and will take on all of Dukenet’s debt.

Dukenet’s network is predominantly across the Carolinas, but also spreads over five other south-eastern states.

Commenting on the deal TWC’s COO of business services said: “This acquisition will help us expand our fibre footprint at a price that is consistent with our disciplined approach to M&A, accounting for expected synergies and tax benefits.”

RBC Capital Markets advised Duke Energy and Alinda on the sale, and Moore & Van Allen provided legal counsel.

Edwards Wildman Palmer provided legal advice to Time Warner Cable.

The companies expect the deal, which is subject to regulatory approvals, to close in Q1 next year.

TWC is in the middle of a managerial change as Glenn Britt, CEO of the cableco since 2001, is set to retire at the end of the year. TWC’s president and COO Robert Marcus will succeed him from 1 January 2014.

During the summer TWC was reported to be considering acquisitions that would mark significant consolidation in the sector. Cablevision Systems Corporation and Cox Communications were named as potential acquisition targets.