Summary:

It is not obviouos to the naked eye, but slowly …. actually very slowly the broadband business is going through a consolidation. In past three days, I have come across three companies which have bought rivals. Cogent Communications, which had been flirting with disaster itself, has […]

It is not obviouos to the naked eye, but slowly …. actually very slowly the broadband business is going through a consolidation. In past three days, I have come across three companies which have bought rivals. Cogent Communications, which had been flirting with disaster itself, has acquired Aleron Broadband (formerly AGIS Internet).  Cogent’s sixth acquisition this year also includes an infusion of cash as part of the transaction. Previous buys include PSINet, NetRail, and AleronThrough the acquisition, Cogent has also received over $18 million in cash to be used for a variety of purposes including network expansion, marketing and sales activities in the U.S. and abroad, and the potential acquisition of additional assets. Ken Peterson of Columbia Ventures Corporation will join Cogent’s board as a result of the transaction. Further details were not disclosed. (Om is investigating, so to speak!)

Mpower Holding Corp., owner of services provider Mpower Communications Corp., has agreed to acquire ICG Communications Inc.’s customer base and certain network assets in California. In case you were wondering, ICG went bankrupt and its assets were bought by Columbia Capital and M/C Venture Partners. Mpower will pay $13.5 million in stock, as well as issue warrants to purchase 2 million shares of common stock with a strike price of $1.38. These capitalized leases have an approximate value of $24 million. Mpower expects to fully integrate the ICG assets throughout 2005. The acquisition is expected to contribute in excess of $30 million in revenue and $8-$10 million of operating income (excluding expenses related to depreciation and amortization of the acquired assets) in 2006. Elsewhere, Cable & Wireless sold its Japanese assets to rival, Softbank for about $134 million. C&W had earlier sold its US business to Savvis Communications or $155 million in cash and assumption of $12.4 million in debt.

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