Millennium Activates Plan B
By Mike Farrell -- Multichannel News, 9/29/2006 12:23:00 PM
With a deal to sell off about 70,000 subscribers on the scrap heap, Millennium Digital Media decided to focus on rebuilding its plant and pursuing new acquisitions, upping longtime president Kelvin Westbrook to chairman and chief strategic officer and hiring former Cebridge Connections (now Suddenlink Communications) president and chief operating officer William Shreffler as president and CEO.
Millennium had an agreement to sell off about 70,000 of its 120,000 subscribers in February to Wave Broadband, the Kirkland, Wash.-based cable company headed by former Millennium executive Steve Weed. That deal, however, was scrapped in favor of recapitalizing the company in early August, according to Millennium senior vice president of marketing Peter Smith.
Smith would not give details on the recapitalization, adding that Millennium is privately owned.
Executives in the cable-finance community said most of Millennium’s debt was purchased by New York-based hedge fund Trimaran Capital Partners and Stamford, Conn.-based distressed-debt investor Black Diamond Commercial Finance. Those investors decided to nix the Wave deal, mainly because they thought they could get a higher price.
Wave was set to acquire Millennium systems in Washington, Oregon and Michigan for $150 million-$200 million. Excluded was Millennium’s 44,000-subscriber system in Anne Arundel County, Md., which competes with Comcast.
The buy was expected to be sort of a homecoming for Weed, who ran the Seattle system for Millennium before striking out on his own with Wave in 2002. Weed said in an interview that he disputed Millennium's right to terminate the agreement, adding, "We continue to pursue the transaction."
One person in the cable-financial community familiar with the failed Wave deal said Weed had already secured franchise transfers for the properties and believed a deal was virtually in the bag.
In hiring Shreffler and promoting Westbrook, Millennium appears to be no longer pursuing a sale, at least for now. Smith said the strategy is actually to acquire more systems and upgrade its plant. “We are definitely out there and talking to people looking for opportunities to grow the business,” he added.
“Ideally, [the goal] would be [to grow] several times our existing size,” Smith said. “I think the upside is based on the resources to do it and the availability of properties at the right price.”
Smith wouldn’t say how much capital is being committed to upgrades and acquisitions, but he added that Millennium is confident that it will have sufficient funding.
Shreffler had been senior vice president of Charter Communications’ Midwest division before joining Cebridge in 2003. He left Cebridge later that same year, forming Home Boulevard, an executive-relocation service.
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