WOW CEO Leaves, Takes Denver Along4/13/2003 8:00 PM Eastern
WideOpenWest LLC chairman and CEO Mark Haverkate has resigned from that company to form a new venture — Champion Broadband — which intends to buy WOW's Denver operation.
Haverkate said last Thursday that he would continue to participate in WOW as its third-largest shareholder. However, he left his active management position last week.
Haverkate and his brother, David, will purchase WOW's partially built system, in operation in Denver and Lakewood, Colo., with their own money, he said. He would not disclose the purchase price of the system, which currently serves about 2,000 customers.
WOW began its business with the new build in Denver, but then expanded by buying the former Ameritech cable properties in Michigan, Illinois, Indiana and Ohio. The Denver build stopped more than a year ago while the company focused on serving the existing sub base it bought in the Midwest.
"Things are going well at the [former] Ameritech systems," said Haverkate. "They all have the same technology, the same marketing plan, but Denver is different. It doesn't fit in geographically."
Haverkate said WOW has generated solid business momentum under the guidance of former AT&T Broadband executive vice president Colleen Abdoulah, who joined the company as president and chief operating officer last August. Given that stability, now is a good time to leave to form the new company, he said.
Denver office of telecommunications director Dean Smits confirmed that Champion Broadband filed a transfer of ownership application on April 1. The petition is in the initial stage of review, said Smits, who noted that WOW's stalled build has left it short of meeting its city franchise requirements.
Noting that overbuilders have seen their sources of venture capital dry up, the Denver official expressed concern over future financing.
Haverkate, a former executive with overbuilder RCN Corp., said the acquisition is contingent on transfer approval by Denver and Lakewood. There's no timetable for resuming the buildout of those two communities, he added.
As the approval process continues, Champion Broadband has already opened its corporate office in Castle Rock, Colo. and launched a Web site.