Hawaiian Telcom (Nasdaq: HCOM) on Monday completed its acquisition of Honolulu-based CLEC Wavecom Solutions.
After initially announcing its intention to acquire Wavecom in July, Hawaiian Telcom received regulatory approvals from both the FCC and Hawaii Public Utilities Commission last Thursday, Dec. 28.
By acquiring Wavecom, Hawaiian Telcom will immediately expand its business and wholesale service capabilities with a six-island subsea and terrestrial fiber network that currently service over 1,700 customers throughout the state.
The service provider said that the Wavecom deal will generate about $4.5 million of annual unlevered free cash flow upon completion of integration activities as a result of net incremental revenues and EBITDA of approximately $7 million and $3.5 million, respectively, in addition to related capital expenditure synergies.
Already delivering a wide array of its own fiber and IP/MPLS networks, the telco said that as it integrates Wavecom's fiber network, its network capabilities "will be enhanced through augmentation of fiber capacity and diversity statewide."
Acquiring Wavecom will provide another boost to Hawaiian Telcom's business and wholesale revenue mix. In Q3 2012, it reported that business revenues rose 1 percent year-over-year to $41.6 million due to a 6.3 percent rise in business high-speed Internet (HSI) subscribers as well as higher equipment sales.
And while legacy TDM revenue losses drove Hawaiian Telcom's wholesale revenue down 2.1 percent to $17.6 million, the ongoing growth of Ethernet circuits provisioned over the new fiber builds helped drive wholesale carrier data revenue up one percent year-over-year to $15.7 million.
In related news, Hawaiian Telcom announced on Wednesday that its stock has been elevated to trade on the Nasdaq Global Select Market.
- see the Wavecom release
- here's the Nasdaq announcement
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