St. Louis-based cable operator Millennium Digital Media reached an agreement to sell about 70,000 subscribers in Washington, Oregon and Michigan to Wave Division Holdings LLC for an undisclosed sum.
Wave president Steve Weed confirmed the agreement, saying that the deal could be completed as soon as June 30.
Wave currently has about 89,000 subscribers in western Washington and Southern California. The Millennium systems are in areas surrounding Seattle and Portland, Ore. (the Northwest systems), and areas surrounding Lansing, Mich. (the central systems). Portions of the Seattle market are an overbuild of Comcast Corp.
Weed said the systems will require some upgrade -- the Michigan systems are currently at 450 megahertz-550 MHz capacity and only about one-half of the Washington and Oregon systems have high-speed-Internet access.
“These are fixer-uppers,” Weed said of the Millennium systems. “Our plan in the Northwest is to purchase them, interconnect and rebuild them as much as we can and launch all of the new advanced services.”
He added, for example, that some of the Northwest systems currently have between 20 and 25 headends.
“A lot of it can be interconnected to the other systems we’ve purchased,” Weed said, adding that the advanced products would likely be rolled out about 12 months after the deal is closed.
Millennium has had these systems on the block for more than one year. Denver-based cable investment banker Daniels & Associates was said to be representing Millennium on the deal.
One system that won’t be included in the deal is Millennium’s Anne Arundel County, Md., property, an overbuild of Comcast. Millennium senior vice president of marketing Peter Smith said the Anne Arundel system will continue to be run by Millennium. It has about 44,000 subscribers.
“As a normal part of our ongoing business, Millennium looks at all of its options -- purchases, sales, recapitalization, acquisition, merger, etc.” Smith said of the decision to sell the central and Northwest markets. “We intend to remain in the cable-TV business for the foreseeable future.”
Millennium is backed by Stamford, Conn.-based private equity firm TSG Capital Group LLC.