ABRY Group purchased the assets of RCN Corp. for about $1.2 billion last March and brought the competitive cable operator private. In the process, it split the consumer and business divisions into separate divisions and renamed RCN Metro as Sidera Networks.
What's the value of the deal?
By going private, RCN Metro, now the new privately-owned Sidera, will be able to concentrate on its core markets and leverage ABRY's capital facilities for new growth initiatives, while continuing to work with the residential and SMB services side of RCN Corp.
"...separating the two companies would enable each company to achieve its full potential on its own" - Mike Sicoli, CEO, Sidera
While RCN Metro was growing as a division of the larger RCN Corp., the problem according to Michael Sicoli, now CEO of Sidera, was that it struggled to get the elements it needed to grow.
"They felt like separating the two companies would enable each company to achieve its full potential on its own and not have to compete with its brother for resources and attention," he said in a previous interview with FierceTelecom.
Sicoli added that Sidera is a "pure play growth company now" that's "100 percent aligned with the exponential growth of broadband, and we have an equity partner now and a capital structure that enables us to invest whatever it takes to deliver the growth that we can capture."
Part of that focus also included retaining a management team that was already familiar with RCN Metro's customer base and focus. So when the deal was complete, Abry did not look for outsiders to run the company. Instead, it turned to the existing RCN Metro and RCN Corp. management such as Sicoli and other executives to run Sidera.
In addition to Sicoli, Ed O'Hara, who previously served as CFO of the Residential and Business Services segment of RCN Corp., took on the role of CFO. Felipe Alvarez became President and COO, Paul Eskildsen the General Counsel, Patrick O'Hare took on the role of VP Engineering and Operations, and Maura Mahoney was named VP Sales and Marketing.
In keeping the management team intact, the new Sidera Networks is likely signaling to its ownership that it can provide consistency in its leadership and keep advancing the company forward and that they are stable.
Part of Sidera's fiber footprint (Source: Sidera)
Keeping to its promise of growth, Sidera has already conducted two acquisitions of its own to scale its colocation and fiber-based Ethernet business.
By acquiring Cross Connect Solutions, Sidera not only gained 28,000 square feet of colocation space to its 100,000 colocation footprint, but expanded its customer base in Philadelphia's Central Business District.
At the same time, Sidera continues to expand its Ethernet service footprint, acquiring Long Island Fiber Exchange, which gave it 900 miles of fiber and 550 lit buildings.
The key for Sidera going forward in 2011 will lie in its ability to continue growing organically and through targeted acquisitions that add value to its portfolio.