TDS Telecom sells four of its ILEC properties to Direct Communications

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TDS Telecom has begun the process of shedding four of its independent ILEC companies to Direct Communications, signaling yet another sign of the rapidly consolidating independent telco market segment.

Under the terms of the agreement, TDS will transfer three Missouri locations, including Stoutland, Orchard Farms and New London, and one in Condon, Ore. Set to close on or about Aug. 1, the combined companies represent about 2,900 access lines.

Direct Communications, which provides traditional voice and Internet services in Missouri and Oregon, will absorb the TDS Telecom markets into its two existing ILEC operating companies, New Florence Telephone Co. in Missouri and Oregon Tel in Oregon. Existing local TDS Telecom field service technicians will become employees of the new respective companies.

"Direct Communications is a lot like TDS Telecom, building their business through acquisition," said Jim Butman, group president of marketing sales and customer service at TDS Telecom. "They were looking to expand and contacted us to see if we'd be willing to sell."

In related news, TDS Telecom's Baja Broadband cable subsidiary upped its presence in its New Mexico market by buying two cable markets in Lovington and Socorro, N.M., from Comcast (NASDAQ: CMCSA) for about $1.9 million. These cable properties reside near several existing Baja markets in the state which will increase Baja's geographic concentration in New Mexico.

Regional telcos selling assets to other players has been an ongoing trend as they either look to expand or divest particular regional assets.

Besides TDS, FairPoint sold its Idaho-based network properties to Blackfoot Telecommunications for about $30 million in 2013. Earlier, Ritter Communications purchased western Tennessee's Millington Telephone Company and Millington Cable TV.

For more:
- see the release

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