HickoryTech Corp. (HTCO) has reached an agreement to acquire Computer Pro Inc., dba CP Telecom, a privately held facilities-based telecom provider, serving Minneapolis, St. Paul and northern Minnesota. The purchase price is approximately $7 million, subject to closing adjustments. The acquisition is anticipated to be funded primarily with cash. The closing of the transaction is subject to regulatory approvals, and is expected in the third quarter 2009.
“This acquisition fits HickoryTech’s strategic direction as it enhances our focus on the small and medium sized business (SMB) customer, expands our business product portfolio, and further develops our agent sales channel program,” said John Finke, HickoryTech president and CEO. “CP Telecom has an experienced management team, a solid customer base, robust product portfolio and expertise in developing and implementing new products, such as mid-band Ethernet for the SMB customer. We anticipate important cost and revenue synergies as we integrate CP Telecom into our current lines of business.”
With operations in Minneapolis and Duluth, Minn., CP Telecom provides voice, data and Internet services. CP Telecom’s 2008 unaudited revenue totaled approximately $10 million. CP Telecom operates in 23 colocations throughout Minnesota, 10 of which HickoryTech does not have a presence in today and five that bring enhanced functionality to HickoryTech’s product portfolio. CP Telecom’s assets include long-term rights on a fiber network encompassing Minneapolis and St. Paul as well as softswitching technology.