Frees Management to Focus on Perfecting Policies and Procedures Necessary to Scale Business
PRINCETON, N.J., Dec. 7 /PRNewswire/ -- At a meeting of the Board of Directors, RCN Corporation (Nasdaq: RCNC, news, msgs) today announced approval of a contract with SKANSKA USA, Inc. under which SKANSKA will manage the construction of RCN's Megaband(TM) Network in select markets. The agreement will improve efficiencies and allow RCN to accelerate its network build.
"The agreement with SKANSKA, coupled with our recent influx of capital, will enable RCN's management team to focus on perfecting the policies and procedures necessary to accelerate the development and expansion of our state-of-the-art fiber-optic network," said Michael Adams, President and Chief Operating Officer. "In this phase of our company's development, it is critical that we have the right resources in place to successfully accomplish this key objective."
In October, the company announced a $1.65 billion investment by Vulcan Ventures, Inc., the investment organization of Paul G. Allen. With Allen's investment, RCN now has $3.8 billion in cash and available capital, enough to fund the company's aggressive network expansion and continuing operations through early 2003.
RCN plans to spend approximately $3 billion over the next three years constructing its network. SKANSKA will initially provide management services to include construction oversight for the installation of the cable television, telephony and data communications' infrastructure in many of RCN's current and targeted markets.
"SKANSKA is a worldwide, multi-billion dollar company with resources in all of RCN's relevant markets, as well as every major market in the U.S. Their presence in these markets could be beneficial if we ever decide to go outside of our current operating territory," said Adams.
"We are delighted to be working with a company like RCN. Because both David McCourt and Mike Adams have strong backgrounds in engineering and construction, it's a win-win situation for both parties," said Stuart Graham, President of SKANSKA USA, Inc.
"Mike has done a superb job leading RCN's network expansion. The hiring of SKANSKA will allow him to focus more closely on the additional responsibilities he recently assumed which involve the management of all aspects of the company's internal operations, particularly the expansion of the network in RCN's target markets," said David C. McCourt, Chairman and Chief Executive Officer.
"One of my main priorities is to continue perfecting our core operations -- with an emphasis on ensuring that our best systems, policies and procedures are being applied uniformly across all of our markets so that we can continue growing at an accelerated rate. Our relationship with SKANSKA will enable me to devote more of my time to this effort as we move RCN to the next level," said Adams.
About the RCN Network
RCN's Megaband(TM) Network is a unique broadband fiber optic platform capable of offering a full suite of communications services -- including fully featured voice, video and high-speed Internet -- to residential customers. The network employs SONET ring backbone architecture, and localized nodes built to ensure RCN's state-of-the-art fiber optics travel to within 900 feet of RCN customers, with fewer electronics and lower maintenance costs than existing local networks.
RCN's East and West Coast local fiber optic networks target densely populated areas comprising nearly 40% of the U.S. residential communications market spread over just 6% of its geography.
About RCN Corporation
RCN Corporation (Nasdaq: RCNC, news, msgs) is the nation's first and largest single- source, facilities-based provider of bundled communications services to the residential market, and the nation's largest targeted Internet service provider (ISP), with all of its customers strategically clustered in the Boston to Washington and San Francisco to San Diego corridors. The company is currently providing local and long distance phone, cable television and high- speed Internet services to the densest telecommunications markets in the country, from Boston to Washington, D.C. in the East and in the San Francisco region in the West. RCN is designing and building its Megaband(TM) Network in the San Francisco to San Diego corridor where it intends to offer all its broadband services in the future.
About SKANSKA, USA, Inc.
Headquartered in New York City, SKANSKA USA, Inc. is a multi-billion dollar company with 22 subsidiaries located throughout the United States. SKANSKA has affiliated companies' worldwide and total revenues of nearly $9 billion.
Some of the statements made by RCN in this press release are forward- looking in nature. Actual results may differ materially from those projected in forward-looking statements as a result of a number of factors. RCN believes that the primary factors include, but are not limited to uncertainties relating to economic conditions, acquisitions and divestitures, government and regulatory policies, the pricing and availability of equipment, materials, inventory and programming, RCN's ability to develop and penetrate existing and new markets, technological developments and changes in the competitive environment in which RCN operates. Additional information concerning these and other important factors can be found in RCN's filings with the Securities and Exchange Commission. Statements in this release should be evaluated in light of these important factors.
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