The 350,000 Northwest residential and commercial customers of Frontier Communications should barely notice the change to local owners, say investors who have agreed to pay more than $1.35 billion for broadband assets in Washington, Oregon, Idaho and Montana.
In Washington, Frontier serves customers in Wenatchee, Tri-Cities, Pullman, Bothell, Kirkland, Redmond, Everett and Mount Vernon. In total, Frontier’s Northwest customers paid $619 million for services during the year ended March 31.
The buyer is a group including Kirkland-based WaveDivision Capital, led by Steve Weed, a familiar name in the region’s communications industry. Weed was previously head of Wave Broadband, which provided internet and cable television to West Coast customers and was sold in 2018 for about $2.36 billion to TPG Capital, becoming part of its RCN/Grande broadband-services company.
The acquisition puts Weed back into the competition to provide high-speed internet access and other communications services in the Northwest, with rivals that include Comcast, CenturyLink and his previous company.
“Our plan is to invest further in our markets, specifically by extending fiber to more homes and businesses, to bring them the high speeds they want,” Weed said in a statement. WaveDivision, founded in 2003, has made six previous investments in internet and telecommunications businesses.
Frontier said its existing Northwest network passes some 1.7 million residences and businesses, including half a million that are already “fiber-to-the-premises capable,” meaning high-speed fiber-optic cables reach all the way to a location.
Weed’s statement said there should be no changes for existing Frontier customers or employees: “All services continue without disruption, all offices remain open, and all contracts and rates will continue to be honored.”
Joining WaveDivision in the purchase of the Frontier assets is Searchlight Capital Partners, a private investment firm with offices in New York, Toronto and London.
The deal is expected to close within a year, pending a slate of regulatory reviews including by state regulators, the Federal Communications Commission, Department of Justice and the Committee on Foreign Investment in the United States.
For Frontier, based in Norwalk, Connecticut, the deal is a means to reduce debt and strengthen its liquidity, said president and CEO Dan McCarthy.