CoreComm Buys Voyager.net for $540 Million
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The deal dramatically enhances CoreComm's (COMM) Internet-based telecom strategy in the Midwest, and significantly increases the firm's Internet-centric capabilities as it rolls out service nationwide.
Voyager.net (VOYN) shareholders will receive 0.292 shares of CoreComm common stock and $3 in cash for each share of Voyager.net common stock. Based on CoreComm's $48 Friday closing price, the purchase price would be $17 per Voyager.net share.
Under the agreement's collar provisions, the shares of common stock issued will be reduced if the CoreComm stock price at closing exceeds $57 per share, and increased if the CoreComm common stock price at closing is below $41 per share. As of December 31, 1999, Voyager.net had total debt of approximately $24 million.
"Voyager.net brings us critical mass in the Internet business in terms of customers, operations, and infrastrurture," Knapp said. "With a combined total of more than 450,000 customers, we become one of the leaders in the Midwest/Great Lakes region overnight."
Chris Torto, Voyager.net president and chief executive officer, said Voyager.net could not find a better partner than CoreComm to help advance its marketing strategy.
"CoreComm will help advance the service offerings to our customers and provide the facilities and backing to complete our DSL expansion," Tortosaid. "This transaction will greatly benefit our customers and employees."
CoreComm is a communications company that provides integrated telephone, Internet, and data services to business and residential customers in select markets throughout the U.S.
East Lansing, Mich.-based Voyager.net is a large full-service Internet service provider serving the mid-western U.S. The company provides high-speed data services to residential and business customers. Voyager.net operates approximately points-of-presence in Michigan, Wisconsin, Ohio, Illinois, Indiana, and Minnesota. It also has Competitive Local Exchange Carrier status in Michigan, Ohio, and Wisconsin.
The transaction is subject to shareholder approval and other customary closing conditions, and is expected to close during this summer.