NEW YORK - Verizon Communications (NYSE:VZ) will purchase OnePoint Communications Corp., an acquisition that will accelerate delivery of voice, video and high-speed Internet services to apartment buildings, condominiums, business offices and other multi-unit structures.
The companies have entered into a definitive agreement calling for Verizon to acquire Chicago-based OnePoint, a leading provider of communications services for residents of multiple dwelling units (MDUs). Verizon is the national communications company formed by the merger of Bell Atlantic and GTE.
Under the arrangement, a subsidiary of Verizon will acquire all of the stock of closely held OnePoint. Financial terms were not disclosed. The transaction is subject to certain conditions, adjustments and regulatory approvals. The companies plan to complete the deal by the end of this year.
"OnePoint is the best at what they do - analyzing the MDU marketplace and putting together the right packages of services for the right audience," said Bruce Gordon, president - Verizon Retail Markets. "With this acquisition, we will further enhance our ability to bundle local, long distance, video and Internet services," said Gordon.
Gordon said OnePoint's relationship with real estate developers would give Verizon entrée to prime MDU properties. He said Verizon also plans to pursue contracts with developers of multiple tenant units (MTUs) that are occupied by small and medium-size businesses. Gordon noted that OnePoint's focus on offering Digital Subscriber Line (DSL) access will greatly enhance Verizon's Internet services. Verizon also plans to offer streaming video services over DSL lines.
"The availability of high-speed Internet access and video-on-demand will make Verizon a superior alternative to cable TV companies and other providers in the MDU market," said Gordon.
A recent study by the Yankee Group concludes that the MDU market, which covers apartments, condominiums, gated communities and other multi-unit dwellings, is valued at $20 billion nationwide.
Together, Verizon and OnePoint currently have 650,000 MDUs under contract in 31 major markets across the country. Gordon said he expects Verizon to have an additional two million properties under contract over the next five years.
"With operations in nine top markets nationwide, OnePoint will offer a strong out-of-region presence for Verizon," said Jim Otterbeck, chairman and founder of OnePoint. "Our relationships with real estate developers, coupled with our sales force focused solely on MDUs, will help Verizon deliver high-speed Internet access to more people, more quickly."
Under the terms of the deal, Otterbeck will remain in Chicago and head up the new subsidiary. He will report to Gordon.
OnePoint currently operates in Atlanta, Ga.; Baltimore, Md.; Charlotte, N.C.; Chicago, Ill.; Denver, Co.; Washington D.C.; Raleigh-Durham, N.C.; Philadelphia, Pa. and Phoenix, Az. The company also has a customer care center in Largo, Md., in the Washington, D.C. suburbs.
Verizon Communications (NYSE:VZ), formed by the merger of Bell Atlantic and GTE, is one of the world's leading providers of communications services. Verizon companies are the largest providers of wireline and wireless communications in the United States, with 95 million access lines and 25 million wireless customers. A Fortune 10 company with more than 260,000 employees and approximately $60 billion in 1999 revenues, Verizon's global presence extends to 40 countries in the Americas, Europe, Asia and the Pacific. For more information on Verizon, visit www.verizon.com.
NOTE: Except for any historical information contained in this press release, the matters discussed herein contain certain forward-looking statements that involve risks and uncertainties, including but not limited to economic, key employee, competitive, governmental, regulatory, contractual and technological factors affecting the company's growth, operations, markets, products, services, licenses and other factors discussed in the company's filings with the Securities and Exchange Commission. Actual results may vary materially due to these and other risks and uncertainties.