Oak Hill Capital completes acquisition of Otelco Inc.

Otelco Inc. announced today that an entity formed by Oak Hill Capital completed its acquisition of Otelco, Inc. for $11.75 per share in cash, representing a total equity purchase price of approximately $40.6 million. As a result of the transaction’s completion, Otelco’s common stock will cease trading at the close of market today and will be delisted from the NASDAQ Stock Market.

Oak Hill, a private equity firm, is an experienced investor in the fiber-to-the-premises space. According to a press release, the firm’s current investments include NetSpeed LLC d/b/a GoNetspeed, a fiber-to-the-premises operator serving residential and business customers in Pennsylvania and Connecticut, and Lantek Fiber Optic Services, Inc., a fiber construction company. With Oak Hill’s acquisition of the three companies, the press release stated, “The acquisitions… bring together the talent and resources to accelerate fiber network deployment throughout their combined footprint.”

Scott Baker and Benjamin Diesbach, partners of Oak Hill, said, “We are excited to work with Otelco, GoNetspeed, and Lantek to expand the availability of fiber-based data services in the communities where the companies operate. We are thrilled to partner with Richard Clark, who will continue to serve as president and CEO of the combined group of companies, and the rest of the senior management teams to become a leading fiber-to-the-premises operator in the northeastern United States.”

Richard Clark, who is president and CEO of Otelco, commented, “This is an exciting day… With the full strategic and financial support of Oak Hill, we are now uniquely positioned to rapidly expand our fiber network investments and provide exciting new capabilities to current and prospective customers and communities.”

Both Trevor Jones, Otelco’s head of marketing and customer operations, and Michael D’Angelo, GoNetspeed’s head of sales and marketing, expressed their excitement regarding the acquisitions. “We are committed to providing the best communication services to our customers. We believe that bringing the companies together will drive innovation to deliver reliable, high-speed fiber internet to more homes and businesses. We are excited to combine our efforts to accelerate the expansion of our best-in-class internet service.”

Otelco Inc. provides wireline telecommunications services in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont, and West Virginia. The company’s services include local and long-distance telephone, digital high-speed data lines, transport services, network access, cable television, and other related services. GoNetspeed is a high-speed fiber-optic internet provider serving residential and business customers. GoNetspeed has been delivering high-speed fiber internet to more than 20 communities and more than 70,000 homes and businesses in Hartford, New Haven, and Fairfield counties and surrounding areas in Connecticut, and 15,000 homes and businesses in Beaver County and surrounding areas in Pennsylvania. Lantek was founded in 2004 and specializes in all aspects of fiber-to-the-premises construction including underground, splicing, and all aspects of installation. Lantek provides services in New York, Pennsylvania, and Connecticut.

Oak Hill Capital is a private equity firm managing funds with over $16 billion of initial capital commitments and co-investments since inception. Over the past 35 years, Oak Hill Capital and its predecessors have invested in approximately 100 private equity transactions across broad segments of the U.S. and global economies.