Two Liberty companies are being rolled into one, bringing together the parent company of Alaskan telecom company GCI and Liberty Broadband, which holds a 25% stake in cable provider Charter Communications.
The stock-for-stock transaction will combine the two companies and values GCI Liberty at $8.7 billion; it is expected to close in the first half of 2021. As reported by MultiChannel News, the two companies are investment vehicles of billionaire and “cable cowboy” John Malone, who serves as chairman of the board of both companies. The transaction will simplify and reduce the costs of operating and administration as public companies, although the companies also noted that a potential benefit is “[improved] flexibility for future strategic combinations.”
Liberty Broadband’s primary asset is its 25% stake in Charter and subsidiary Skyhook. GCI Liberty’s principal assets consist of GCI Holdings and non-controlling interests in Liberty Broadband, Charter Communications and LendingTree.
Greg Maffei, Liberty Broadband and GCI Liberty President and CEO, said the transaction is “financially attractive and beneficial for both companies.”
In related news, GCI Liberty reported its quarterly results and saw a 5% increase in revenue, including 6% year-over-year growth in wireless consumer revenues and a 10% jump in data service revenues, offset by falling voice and video revenues. GCI said that it has “seen a substantial increase in network traffic since early March, with utilization stabilizing at approximately 25% greater than pre-COVID-19 levels” and that its network continues to perform well. GCI began turning up 5G service in April and in June, began a 5G roaming relationship with T-Mobile US.
“GCI continued to make substantial financial and operational progress during the quarter,” said GCI CEO Ron Duncan in a statement. “Despite the challenges of serving our customers in the midst of a pandemic, we added 3,700 consumer cable modem customers during the quarter. Our consumers responded to 5G service, faster speeds and improved coverage from our wireless network upgrades and we added 3,500 new consumer wireless subscribers sequentially.”
