Solution provider Consolidated Communications Monday said it is divesting ownership of two Virginia-based telecom services properties – Peoples Mutual Long Distance Company and Peoples Mutual Telephone Company – through a sale to RiverStreet Networks.
The all-cash sale, valued at approximately $21 million, is expected to close during the first quarter of 2018, according to the Mattoon, Ill.-based company, No. 45 on the 2017 CRN Solution Provider 500. Peoples Mutual accounted for a combined $6.5 million in revenue during fiscal year 2016, providing telecom services in the southern Virginia towns of Gretna, Hurt, Renan and Sandy Level.
Consolidated Communications said the move enables further prioritization of "core" business operations and the integration of FairPoint Communications, which was acquired for a whopping $1.5 billion in December 2016. The company was unable to provide more information by press time.
The FairPoint purchase came within one day of Consolidated Communications selling its IT services equipment and integration business to ePlus Technology, No. 35 on the 2017 CRN Solution Provider 500. The Minneapolis-based IT services division was a Cisco Gold partner that dealt in a broad range of data center, collaboration, networking and security solutions and services.
At the time, executives said Consolidated Communications would be able to deepen its fiber footprint in northern New England by acquiring the 2,600-person Fairpoint, which specializes in cloud telecom and data center co-location services. Roughly 80 percent of its revenue comes from business dealings in Maine, New Hampshire and Vermont.
The deal also allowed Consolidated Communications to diversify its revenue streams. As of last year, the solution provider derived 83 percent of its sales from business and broadband communications dealings.
"This merger positions Consolidated to leverage its extensive product and services portfolio … bringing advanced solutions and a better experience to customers," Consolidated Communications CEO Bob Udell said in a statement.
RiverStreet Networks is a subsidiary of Wilkesboro, N.C.-based Wilkes Communications, which likewise services rural counties in the western part of its home state.
“We are very excited to enter into this agreement and expand our service area into Virginia, strengthening our position as a technology partner in the region,” Eric Cramer, president and CEO of Wilkes Communications, said in a statement. “We look forward to serving the customers of Virginia and expect a seamless transition upon closing.”