RCNC TO ACQUIRE EROLS INTERNET PROVIDER!!!
Hey gang here's some news I just got off the internet.
Erol's Internet, Inc. Agrees To Acquisition by Telecom Revolutionary RCN
SPRINGFIELD, VA, January 21, 1998. Erol's Internet, Inc., a Springfield,
Va.-based Internet service provider (ISP), announced today that it has
agreed to be acquired by RCN Corporation (NASDAQ: RCNC). RCN is the
nation's first and largest single-source, facilities-based provider of
telecommunications services, offering local and long-distance telephone,
video programming, cable and data services (including high bandwidth,
optic fiber, local loops), primarily to residential customers, in several
markets in the Boston/Washington, DC corridor. Erol's, the nation's
largest regional ISP and eighth largest ISP overall, currently serves
residential subscribers, small and medium-sized businesses and small
office/home office customers in targeted markets from Massachusetts to
Virginia. Since inception of its ISP operations in August 1995, Erol's'
subscriber base has grown to more than 295,000.
On December 8, 1997, Erol's filed a registration statement with the
Securities and Exchange Commission for an initial public offering. Dennis
Spina, President and CEO of Erol's, has indicated that the initial public
offering will be withdrawn as a result of the RCN transaction. According
to Spina, "Anticipated reduced network costs, exposure to cable
modem technology and availability of RCN's established sales force to
market our expanding array of business services makes this opportunity
most attractive to Erol's and puts us in a position to enhance our
network infrastructure and grow our business. The elements of this
transaction, and its potential benefits to Erol's, go far beyond what
we could have expected from the IPO." "Erol's' ISP business and RCN's
telecommunications capabilities are a natural fit, and the fact that both
companies have substantial presence in the Washington-to-Boston corridor
should substantially enhance the natural synergies already inherent in
the combination," according to Spina. "The combined company, building on
RCN's powerful telecommunications capabilities and strategic relationships
throughout our existing markets and our strong and growing ISP subscriber
base will be a competitive force to be reckoned with," said Spina. "This
is an exciting opportunity for all of us." Subsequent to the merger,
Spina will assume responsibility for the combined ISP operations.
Under the merger agreement, Erol's will be merged into a wholly owned
subsidiary of RCN. Founder, Erol Onaran, will receive a combination
of RCN stock and cash in exchange for his 69% stake in Erol's. Venture
firm Gold & Appel Transfer, S.A., which owns substantially all of the
remaining Erol's stock, will receive RCN stock in exchange for its
shares. Management options in Erol's will be rolled into RCN options in
connection with the merger transaction. "This aligns the interests of
incumbent Erol's management with the success of RCN," said Spina. The
merger is subject to receipt of all required government approvals and
compliance with other customary conditions.
Erol's Computer and Service Department Erol's Computer and Service
Department will continue to operate as a private company owned by Erol
and Family. erols.com
Cheers.
Captain Nemo |
