Fort Worth and San Francisco-based private-equity firm TPG announced Monday it has agreed to purchase two small cable providers, RCN Telecom Services LLC and Grande Communications Networks LLC, for $2.25 billion.
TPG will acquire both from Abry Partners LLC, paying $1.6 billion for
RCN and $650 million for Grande.
TPG will combine the assets to create a top ten U.S. cable company and a regional market-leading provider of next-generation, high-speed data to residential and business customers, according to a news release. The transaction is expected to close in the first quarter of 2017 and is subject to customary closing conditions and regulatory approvals.
TPG is partnering with Patriot Media, an industry management team headed by Steve Simmons and Jim Holanda that currently manages both RCN and Grande on the deal.
Grande Communications provides internet, TV and telephone services in Austin, Corpus Christi, Dallas, Midland-Odessa, San Antonio, San Marcos, Waco and the Temple area. The company serves more than 160,000 customers.
RCN offers services in Boston, Chicago, Washington, D.C., New York City and parts of Pennsylvania.
Patriot Media, which has managed RCN since 2010 and Grande since 2013, has led both businesses through significant periods of growth.
TPG was advised on the transaction by PJT Partners, UBS, Cleary Gottlieb, and Deloitte. ABRY, Patriot Media, RCN, and Grande were advised by Credit Suisse, Kirkland & Ellis, Locke Lord and PwC. – The Associated Press contributed to this report.Â