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RCN means business with Con Edison buy

December 6, 2005 By Jeff Baumgartner, CED

RCN Corp. said it will expand its commercial services footprint after inking a deal to buy Consolidated Edison Communications Holding Company (CEC) for $32 million in cash.

CEC, the telecom subsidiary of Consolidated Edison Inc., services large commercial customers and carriers in New York. RCN said the acquisition will complement its presence in the small- and medium-business segment, and more than double RCN’s annualized commercial services revenue to roughly $70 million.

RCN said the deal will allow it to increase its base of addressable homes in residential franchise areas in New York, New Jersey and Connecticut.

The agreement “is a key strategic move that strengthens our New York residential and commercial presence, which is central to our strategic plans,” said RCN Chairman James Mooney, in a release.

RCN’s and Con Edison’s boards, and RCN’s required lenders have already approved the deal. The companies expect to close the agreement in Q1 2006.

CEC, considered a competitive local exchange carrier, recorded $33 million in revenues in 2004, and expects to extend that to $42 million this year. CEC operates 560 route miles of fiber optics throughout Manhattan that connect 193 “on-net” buildings.

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