Brookfield to acquire Cincinnati Bell for $2.6bn

Brookfield Infrastructure to acquire Cincinnati Bell for $2.6bn

10 January 2020 | Natalie Bannerman

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Brookfield Infrastructure has entered into an agreement for the acquisition of Cincinnati Bell for approximately $2.6 billion.

Each share of Cincinnati Bell stock has been valued at $10.50 at the close of the deal. This figure represents a 36% premium to the existing closing share price of $7.72 as of December 20 2019 and a 84% premium to the 60-day volume weighted average price.

“After thoroughly reviewing a range of strategic alternatives and possible business opportunities for maximising value, the Board determined this transaction was in the best interest of the company, its shareholders, and its customers,” said Lynn Wentworth, chairman of the Cincinnati Bell board of directors. “The transaction provides clear and immediate value at an attractive premium and represents an exciting new chapter for Cincinnati Bell.”

Cincinnati Bell is the owner, operator of a data transmission and distribution network in Cincinnati, Ohio and Hawaii. Its footprint spans 1.3 million homes delivering fibre broadband, video and voice services to residential and enterprise customers. At present the company is in the midst of a transformation to upgrade its network to next-gen fibre, succeeding so far in upgrading 50% of its network.

“The transaction strengthens our financial position, enabling accelerated investment in our strategic products that is not presently available to Cincinnati Bell as a standalone company,” added Leigh Fox, president and chief executive officer of Cincinnati Bell. “This will allow us to drive growth and maximise value over the long term to the benefit of all our stakeholders. With Brookfield Infrastructure’s support, we will be better positioned to deliver next generation, integrated communications for our customers through an expanded fibre network.”

The deal is expected to close by the end of 2020 and is subject to the standard regulatory conditions.

“This investment represents an opportunity for Brookfield Infrastructure to acquire a great franchise and leading fibre network operator in North America,” continued Sam Pollock (pictured), chief executive officer of Brookfield Infrastructure. “We are excited to leverage our operating expertise to work with the company’s management team as it completes its industry-leading fibre optic rollout plan. CBB is a great addition to our data infrastructure portfolio and we expect it will contribute strong utility-like cash flows with predictable growth.”