Apollo Global Management, Inc. (NYSE: APO) (together with its
consolidated subsidiaries, “Apollo”) and Lumen Technologies, Inc.
(NYSE: LUMN) (“Lumen”), today announced that funds managed by
affiliates of Apollo (the “Apollo Funds”) have entered into a
definitive agreement to acquire Lumen’s ILEC assets and all
associated operations across 20 states (“NewCo”) for $7.5 billion.
The transaction is subject to customary closing conditions,
including regulatory approvals, and is expected to close in 2022.
Today, the NewCo platform serves more than 6 million homes and
businesses across the Midwest and Southeast regions of the United
States. As a standalone company, NewCo will be led by Bob Mudge,
Chris Creager, and Tom Maguire – industry veterans who together
were responsible for the buildout and growth of Verizon’s
fiber-based Fios service. The investment from the Apollo Funds will
help accelerate the upgrade to fiber optic technologies, bringing
faster and more reliable internet service to many rural markets
traditionally underserved by broadband providers, while delivering
best-in-class customer service.
“The team at Lumen has built a great business and we see an
incredible opportunity to provide leading edge, fiber-to-the-home
broadband technology to millions of its business and residential
customers,” said Aaron Sobel, Private Equity Partner at Apollo.
Sobel continued, “As more of our economy, educational systems
and entertainment choices move online, it reinforces the urgency
and importance of providing faster, more reliable internet
connectivity to bridge the digital divide, particularly in rural
and suburban America. Through this investment, we will address this
divide by expanding the latest fiber infrastructure to more local
communities while delivering exceptional customer service. We are
thrilled to have a team of industry-leading executives, led by Bob
at the helm, and are confident in their ability to execute on our
collective thesis.”
“Tom, Chris and I know the tremendous benefits fiber optic
technology can bring to customers, employees and their communities,
and I’m energized by the transformational opportunity that lies
ahead,” Mudge said. “The three of us look forward to working
closely with our new team to build a state-of-the-art fiber network
while continuing to serve the existing customer base. We have a
great strategic partner in Apollo, and they have been extremely
thoughtful about the experience, resources and investment required
to complete an exciting, multi-year transformation of this
scale.”“Apollo invests in opportunities, communities and their
people to achieve exceptional outcomes for investors
and make a positive social impact,” said Jeff Storey,
Lumen president and CEO. “With this transaction, the Apollo Funds
will acquire a well-developed fiber backbone network spanning 20
states and generating consistent cash flow, along with the
operations and back office support necessary to successfully
operate the business on day one.”
Transaction Details and Advisors The
transaction is subject to satisfaction of certain closing
conditions, including regulatory approvals from the Federal
Communications Commission, the U.S. Department of Justice, and
applicable state regulatory agencies. Lumen will continue to
operate all assets and serve all customers until the transaction
closes, which is expected in 2022.
Advisors to the Apollo Funds include Barclays, Credit Suisse,
Deutsche Bank, LionTree, and Mizuho as financial advisors; Altman
Solon as telecommunications, media and technology consultant; and
Paul, Weiss, Rifkind, Wharton & Garrison LLP as lead legal
counsel, together with Jenner & Block LLP and Morgan Lewis
& Bockius LLP as regulatory counsel.
Citi, Goldman Sachs, Bank of America and Morgan Stanley acted as
financial advisors to Lumen, and Jones Walker LLP is acting as its
legal counsel.
About ApolloApollo is a high-growth, global
alternative asset manager. We seek to provide our clients excess
return at every point along the risk-reward spectrum from
investment grade to private equity with a focus on three business
strategies: yield, hybrid and opportunistic. Through our investment
activity across our fully integrated platform, we serve the
retirement income and financial return needs of our clients, and we
offer innovative capital solutions to businesses. Our patient,
creative, knowledgeable approach to investing aligns our clients,
businesses we invest in, our employees and the communities we
impact, to expand opportunity and achieve positive outcomes. As of
March 31, 2021, Apollo had approximately $461 billion of assets
under management. To learn more, please visit
www.apollo.com.Forward-Looking StatementsThis
communication and other written or oral statements made by or on
behalf of Apollo contains forward-looking statements. In
particular, statements using words such as “may,” “seek,” “will,”
“likely,” “assume,” “estimate,” “expect,” “anticipate,” “intend,”
“believe,” “do not believe,” “aim,” “predict,” “plan,” “project,”
“continue,” “potential,” “guidance,” “foresee”, “might”,
“objective,” “outlook,” “trends,” “future,” “could,” “would,”
“should,” “target,” “on track” or their negatives or variations,
and similar terminology and words of similar import, generally
involve future or forward-looking statements. Forward-looking
statements reflect Apollo’s current views, plans or expectations
with respect to future events and financial performance. They are
inherently subject to significant business, economic, competitive
and other risks, uncertainties and contingencies. The inclusion of
forward-looking statements in this or any other communication
should not be considered as a representation by Apollo or any other
person that current plans or expectations will be achieved.
Accordingly, you should not place undue reliance on any
forward-looking statement. Forward-looking statement speak only as
of the date on which they are made, and Apollo undertake no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future
developments or otherwise, except as otherwise required by law.
Contact Information
Apollo
For InvestorsPeter Mintzberg, Head of Investor
RelationsApollo Global Management, Inc.(212) 822-0528
APOInvestorRelations@apollo.comFor MediaJoanna
Rose, Global Head of Corporate CommunicationsApollo Global
Management, Inc.(212) 822-0491Communications@apollo.com
Lumen
Media Contact: Stephanie
Meisse Lumen 419-610-3142 stephanie.n.meisse@lumen.com
Investor Relations Contact: Mark
Stoutenberg Lumen 720-888-1662 Mark.stoutenberg@lumen.com
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