NEW YORK, Dec. 13 -- FiberNet Telecom Group Inc., a provider of managed network services, announced today it has signed an agreement to acquire Con Edison Communications (CEC), a subsidiary of Consolidated Edison Inc., for approximately $37 million in cash. FiberNet said the acquisition of CEC, a company that also provides managed network services in the New York metropolitan area, will more than double its revenues. The boards of both companies have approved the acquisitio, which is pending regulatory approval from federal, state and municipal authorities.
In acquiring CEC, FiberNet gains access to the Con Edison Company of New York (CECONY) electric conduit system, positioning it as the only company to extensively use both the electric utility and conventional telecommunications rights-of-way. The combined companies will focus on designing, implementing and managing private networks and high-performance data services. Together, FiberNet and CEC currently serve more than 400 customers, including financial institutions, trading exchanges and other data networking users. Combined network assets will include almost 80,000 fiber miles and access to 190 buildings in New York and Los Angeles, including 18 central offices, 22 carrier hotels and 150 commercial buildings.
FiberNet said key CEC employees will become FiberNet employees. The new management team will comprise executives from both FiberNet and CEC. Michael Liss, FiberNet president and CEO, will remain chairman after the acquisition. Jon A. DeLuca, currently FiberNet's senior vice president of finance and CFO, will become president and CEO; Edward Granaghan, FiberNet's vice president of finance, will succeed DeLuca as CFO; and Peter Rust, CEC's president and CEO, will be president of FiberNet Enterprise Services, a wholly-owned subsidiary. Richard E. Sayers, recently appointed vice chairman of the FiberNet board of directors, will retain that role.
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