EVERETT — Last year, Steve Weed, then the CEO of Wave Broadband, sold the Kirkland-based company that he founded in 2003 for $2.36 billion.
The buyer, TPG Capital, is one of the largest private equity firms in the world, according to financial experts.
But the sale of the company didn’t sever Weed’s ties to telecommunications.
As CEO of WaveDivision Capital, a private equity firm he launched in 2003, Weed has continued to invest in broadband providers.
Now he’s about to jump back into the local broadband scene.
Kirkland-based WaveDivision and Searchlight Capital Partners, which has offices in New York, Toronto and London, announced last week they’re buying the Northwest operations of Frontier Communications for $1.36 billion.
“Our plan is to invest further in our markets, specifically by extending fiber to more homes and businesses, to bring them the high speeds they want,” Weed said in a news release.
Beyond that written announcement last week, WaveDivision declined to comment or elaborate “due to regulatory requirements,” a company spokesman said.
Weed’s company is buying what was once the Everett area’s legacy landline telephone company.
Today, Frontier Communications offers television and internet services in addition to phone service. But the origin of the business, two owners ago, was General Telephone & Electronics Corp., the largest independent phone company during the days of the massive Bell Telephone system, when landline telephone service was a regulated monopoly.
General Telephone eventually changed its name to GTE. GTE Northwest, which served Idaho, Montana, Oregon and Washington, was founded in 1964 as one of GTE Corp.’s operating companies.
Deregulation eventually freed telephone providers and cable TV companies to compete and provide the full range of telecommunications — TV, internet, landline phone and cellular service. In 2000, Bell Atlantic Corp. and GTE merged to become Verizon Communications.
In 2010, Verizon sold its landline phone assets to Frontier Communications.
Today Frontier serves about 156,000 residential and business customers in Washington and another 194,000 in Oregon, Idaho and Montana, according to the Washington Public Utilities and Transportation Commission. In Washington, Frontier serves customers in Snohomish, Skagit and Whatcom counties and eastern portions of the state.
The company’s Western Washington headquarters is in Everett, in a building GTE had built in 1981 at 1800 41st St. In 2018, Frontier employed about 590 here.
Frontier sold the building in 2012 but still occupies the north tower. (The Daily Herald and its parent, Sound Publishing, leases part of the third floor of the south tower.)
For Frontier, based in Norwalk, Connecticut, the cash deal with Weed’s company helps reduce debt. The deal is expected to close by the end of the year and is subject to approval by the Federal Communications Commission, the U.S. Department of Justice and the Committee on Foreign Investment in the United States.
Frontier said it will continue to operate the business and serve customers with existing products and services until the transaction closes.
WaveDivision said no immediate changes are planned that would affect customers or regional Frontier employees.
WaveDivision has investments in telecom companies all over North America. They include Hargray Communications in South Carolina; Metronet Communications in Evansville, Indiana; and RCN/Wave/Grande, serving parts of Massachusetts, Chicago, Pennsylvania, New York City, Washington, D.C., Texas, Washington, Oregon and California; and Xplornet based in New Brunswick, Canada.
WaveDivision’s managing directors include former Wave Broadband executives Harold Zeitz and Wayne Schattenkerk.
Janice Podsada; jpodsada@heraldnet.com; 425-339-3097; Twitter: JanicePods.
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