MetroNet Acquires Inter-City Fibre for Nationwide IP Network Acquisition Creates Canada's Premier Facilities Based Local and
Long Haul Fibre Telecommunications Company <>
December 8, 1998
TORONTO, Nov. 2 /PRNewswire/MetroNet
Communications Corp. (Nasdaq: METNF and
Toronto, Montreal: MNC.B), Canada's largest
facilities based national competitive local
telecommunications services provider, today
announced that it is acquiring a
state-of-the-art nationwide long haul fibre
optic network from Ledcor Industries Limited,
Worldwide Fiber Inc., and in part from
Call-Net/fONOROLA. The all cash
transactions, valued in aggregate at
approximately C$200 million, includes
dedicated strands of fibre optic cable along
more than ninety-five hundred route
kilometres in Canada and along key border
crossings into the United States. The
inter-city fibre network will connect major
metropolitan cities across Canada. MetroNet
intends to fund this acquisition, as well as its
continued growth and expansion, from its
unrestricted cash balances, which totaled
over $680 million at September 30, 1998.
This inter-city fibre network, which is
approximately 50% completed, with the
remaining segments to be completed over
the next year, will be interconnected with
MetroNet's robust local fibre networks, and
link its voice, frame relay, IP and ATM
services nationally, to create the largest
competitive end-to-end voice and data
telecommunications network in Canada. With
the addition of this nationwide inter-city fibre
optic network, MetroNet will construct over
the next twelve months a high-speed,
efficient IP network utilizing dense wave
division multiplexing (DWDM) and SONET
technologies to provide customers with the
most advanced end-to-end data and voice
products available.
"We have said all along that we fully intend
to create significant value for our customers
and shareholders as Canada's premier
facilities based telecommunications
company," said D. Craig Young, MetroNet's
president and chief executive officer. "This
acquisition is another giant step in securing
our vision while at the same time enhancing
our cost structure, attaining key strategic
cross-border fibre routes, and expanding our
addressable market in the local, data,
Internet and long distance segments of our
business."
In addition to dedicated strands of
cross-country and cross-border fibre optic
cable, the transaction also covers
transmission equipment sites, backup power,
network maintenance, and rights of way
along the more than ninety-five hundred
kilometre route. This advanced fibre network
is designed to provide high levels of reliability
and security, and will be protected by a
combination of physically diverse routing and
self-healing SONET rings.
The inter-city fibre optic network will
interconnect all of the key Canadian market
clusters where MetroNet operates or is
constructing local exchange telephony
facilities. These markets include Vancouver,
Calgary, Edmonton, Winnipeg, London,
Kitchener-Waterloo, Hamilton, Mississauga,
Toronto, Ottawa, Hull, Montreal, and Quebec
City.
In addition, MetroNet's network will connect
the Canadian cities of Victoria, Saskatoon,
Regina, Thunder Bay, Sudbury, Brampton, St.
Catharines, Windsor, Sarnia, and Oshawa.
The network will provide MetroNet with
significant additional network capacity to
accommodate its planned growth and
expansion and will allow it to achieve cost
savings by eliminating long haul facilities it
currently leases between cities from other
carriers.
This acquisition also provides MetroNet with
strategic cross-border fibre optic facilities
connecting its Canadian networks with the
important Northern-U.S. cities of Seattle,
Minneapolis, Madison, Milwaukee, Chicago,
South Bend, Lansing, and Detroit. MetroNet
had previously acquired access to the
important Toronto to Buffalo cross-border
fibre route with its June 30, 1998 purchase
of Rogers Telecom. The U.S.-Canada
exchange of voice and data traffic
represents the most heavily utilized
international calling corridor in the world, and
MetroNet is now well positioned to
participate in originating and terminating
voice and data traffic in this very large
segment of the telecommunications market.
With the completion of the inter-city long
haul fibre optic network, MetroNet will have
Canada's most advanced end-to-end local,
data, Internet, and long distance
telecommunications services available,
provided over a single all fibre optic network,
from a single provider, with a single bill, and
a single point of customer service.
MetroNet has also reached an agreement
with Ledcor that allows the company to
participate, should it choose, in any or all
future long distance fibre optic network
routes which Ledcor constructs in North
America.
Mr. Young concluded by saying that,
"Through the combination of our aggressive
network construction and back office
development programs and key acquisitions,
MetroNet has built one of the most
advanced, comprehensive and strategic
telecom assets in the world. As thousands of
businesses have already discovered,
MetroNet is delivering on its commitment of
providing real choice and value in the
Canadian telecommunications market."
MetroNet Communications Corp.: Built for
Business(TM), MetroNet Communications is
Canada's first national provider of local
telecommunications services and the
country's largest competitive local exchange
carrier (CLEC). Deploying the most advanced
fibre optic networking and switching
platforms, MetroNet offers business and
government customers across the country a
full suite of local and long distance voice,
data and Internet services -- with one point
of contact, excellent customer service and
competitive pricing. MetroNet is a public
company with its common stock traded on
the Toronto and Montreal stock exchanges
under the symbol MNC.B and on the Nasdaq
National Market System under the symbol
METNF.
Ledcor Industries Limited: Ledcor Industries
Limited is a multi-disciplined, international
construction company with operations
throughout Canada, the United States and
Mexico. Ledcor was founded in 1947,
employs more than 2,000 people, and in 1997
ranked as the fourth largest construction
company in Canada. Worldwide Fiber Inc. is
the recently incorporated
telecommunications division of Ledcor, which
is developing and building a 23,000 kilometre
fiber optic network across North America.
Forward-Looking Statements
This news release includes statements about
expected future events and/or financial
results that are forward-looking in nature and
subject to risks and uncertainties, including
satisfaction of the conditions to the
transaction and the successful completion
and integration of the intercity fibre assets
being acquired. For those statements, we
claim the protection of the safe harbor for
forward-looking statements provisions
contained in the Private Securities Litigation
Reform Act of 1995. The company cautions
that actual performance will be affected by a
number of factors, many of which are beyond
the company's control, and that future
events and results may vary substantially
from what the company currently foresees.
Discussion of other factors that may affect
future results is contained in the company's
recent filings with the Securities and
Exchange Commission and the Canadian
Securities Commissions.
SOURCE MetroNet Communications Corp.
/CONTACT: MetroNet Communications:
Investors and Analysts: Bruce M. Mann, Vice
President, Investor Relations, 416-640-6777,
or brucemann@metronet.ca, or Media: Drew
Van Parys, Director, Marketing
Communications, 416-640-9030, or
drewvanparys@metronet.ca; Ledcor
Industries Limited: Larry Olsen, Vice
Chairman, 604-681-1994, or
lolsen@worldwidefiber.com, or Will Walls,
Finance Manager, 604-681-1994, or
wwalls@worldwidefiber.com, both of
Worldwide Fiber/ /Web site:
ledcor.com
metronet.ca (METNF MNC.B)
[Copyright 1998, PR Newswire] |
