At least five rural telcos are embracing the idea that companies such as theirs need to consolidate. Those companies back in March created a new entity known as USConnect Holdings that aims to acquire other rural and independent communications providers.
“USConnect is an industry-rooted effort committed to sustaining the financial and operational viability of rural and independent communications providers,” said a USConnect press release issued late Friday to announce the organization’s first acquisition – Livingston Telephone Company of Livingston, Tex.
Five rural telcos are the “majority investors” in USConnect, a USConnect spokeswoman told Telecompetitor this morning. The spokeswoman declined to reveal the names of minority investors.
The five rural telco majority investors are:
- Golden West Telecommunications of Wall, S.D.
- Horry Telephone Cooperative of Conway, S.C.
- Farmers Telephone Cooperative of Kingstree, S.C.
- Brazoria Telephone Company of Brazoria, Tex.
- Dickey Rural Networks of Ellendale, N.D.
According to Friday’s release, USConnect is “committed to sustaining the financial and operational viability of rural and independent communications providers.” But the USConnect spokeswoman declined to provide details on what strategy or business model the organization might use to achieve that goal.
“The existing business models of rural telecom companies [are] changing,” she said. “There are new opportunities and challenges and every communications company in America is aligning [its] resources with solid business plans. As [the industry] evolves, the company will evolve with it.”
The spokeswoman also would not provide specifics about the types of companies USConnect would look to acquire. “As opportunities present themselves and as the industry continues to consolidate, this group will assess opportunities as they come up.”
Asked why the five telco majority investors are making this move now, the spokeswoman said, “As the industry consolidates and evolves, the way to keep rural America a viable place to live, work and play is with a strong communications infrastructure. This group does that today and wants to make sure these types [of communications services] are available for rural consumers.”
In addition to acquiring rural telcos, Friday’s release indicates that USConnect would consider acquiring “related properties strategic to the provision of community-based communications, broadband and technology services.”
Livingston Telephone Company’s serving area includes 83 square miles located approximately 65 miles north of Houston. The company also has a Telcom Supply subsidiary that offers video, high-speed Internet and security monitoring services under the Livingston Telephone brand. Telcom Supply also owns and operates local AM and FM radio stations and a local TV station.
Makes good sense. would rather see the telcos band together to get better, than have outsiders who don’t understand the industry come in.