Little Rock-based telecom operator Windstream Holdings Inc. on Friday (July 28) closed on the acquisition of upstate New York cloud solutions operator Broadview Networks Holdings Inc. in an all-cash deal worth $227.5 million, company officials announced after Friday’s opening bell.
Broadview Networks, based in Rye Brook, N.Y., is the provider of cloud-based solutions to small and medium-sized businesses under the “OfficeSuite” brand. Windstream first announced in April its plans to acquire the East Coast telecom, which company officials have said will emerge as important solution for Windstream customers that are increasingly dependent on the cloud and looking to digitally transform onsite.
“The addition of Broadview advances our strategy to differentiate ourselves by delivering a truly superior customer experience using disruptive technologies,” Windstream President and CEO Tony Thomas mas said in a statement. “Broadview’s innovative, award-winning unified communications solution, OfficeSuite, perfectly complements Windstream’s SD-WAN offering. Both are highly scalable, easy to customize and less expensive to deploy than traditional solutions. We will move quickly to sell the combined solution across our national footprint.”
Windstream spokesman David Avery said Broadview’s will bring nearly 725 employees to the company’s current workforce count of 13,500. Windstream expects to realize approximately $30 million in annual operating synergies within two years, while the deal will improve the company’s balance sheet by reducing leverage through the realization of synergies and will be accretive to free cash flow in the first year, officials said.
Speaking at a recent conference with Wall Street analysts and investors in Boston, Thomas said recent acquisitions with former rival Earthlink and Broadview Networks will bolster the Little Rock telco’s future earnings and revenue growth as the industry transitions to cloud computing and software-defined network technology (SD-Wan).
Windstream completed its acquisition of former rival EarthLink Holdings Corp. of Atlanta on Feb. 27 after both companies’ shareholders approved the $1.1 billion deal over the weekend. Windstream officials said the company expects to achieve more than $150 million in annual operating and capital expense synergies within 36 months of closing, an increase of $25 million over its initial estimates.