Anchorage-based Alaska Communications announced plans Thursday to sell its remaining wireless assets in the state to General Communication Inc. (GCI) to help pay down debt and focus on its growing broadband business.
The sale, for $300 million, includes Alaska Communications’ wireless subscriber base and its 33 percent interest in a partnership between the companies known as The Alaska Wireless Network LLC. At the end of September, Alaska Communications had more than 100,000 wireless customers.
Alaska Communications plans to use the net proceeds, which it estimates at about $250 million after costs associated with the deal, toward paying down its current debt of about $415 million.
Over the last three years, the company has been paying down the debt that includes about $125 million incurred in the building of submarine cables from Alaska to the Lower 48, president and CEO Anand Vadapalli said in an interview.
Vadapalli said the sale will strengthen his company’s position and allow it to focus on broadband and information technology services, currently the largest part of its business.
The company will need consent from lenders, which it expects, and GCI will have to get financing for the purchase, he said.
GCI spokesman David Morris said GCI is in a favorable financial position to secure the necessary funding,
Alaska Communications would move its wireless contracts to GCI next year. Wireless customers who get home Internet through Alaska Communications will be able to continue receiving that service from the company.
The companies said wireless services will be uninterrupted.
GCI is in the process of hiring for about 150 new positions to accommodate the change, Morris said.
Between 150 and 200 jobs will be affected at Alaska Communications, including some eliminated through voluntary buyouts and attrition.
