Suddenlink hearing set for next month
CHARLESTON, W.Va. - The City of Charleston has scheduled a public hearing on Nov. 14 to consider the pending sale of Suddenlink Communications.
The hearing by the City Council's Committee on Cable Television will be at 6 p.m. in the mayor's Conference Room on the second floor of City Hall, 501 Virginia St. E.
According to a notice issued by City Clerk James Reishman, the purposes of the hearing will be to:
The city has a say in the deal because state law says that for a change of ownership to occur, written application and approval is required from all of the appropriate franchising authorities. Charleston City Council unanimously approved a five-year cable television franchise deal with Suddenlink on Nov. 21, 2011.
Many other cities and some counties also have franchise agreements with Suddenlink. The state Public Service Commission is the franchising authority in Nicholas and Gilmer counties.
Suddenlink offers television, Internet, phone, security and other services to more than 220,000 residential households and 9,500 businesses in West Virginia, making it the largest cable broadband company in the state.
In July, Suddenlink announced that it and its existing equity holders, led by Goldman Sachs Capital Partners and including Quadrangle and Oaktree Capital Management, had reached an agreement under which a private-equity firm, BC Partners, and the Canada Pension Plan's CPP Investment Board, would join with Suddenlink's management team to purchase the company for $6.6 billion.
The company said at the time that the change in ownership would result in a nearly $2 billion cash infusion.
In a July 26 letter to Charleston Mayor Danny Jones, Suddenlink said the change "will be entirely seamless from a consumer standpoint. Suddenlink will continue to provide high-quality communications services to customers without interruption, and it has no existing plans to discontinue any existing service or to implement any changes in rates, terms, or conditions in connection with the transaction."
However, in a discussion of its financial condition, Suddenlink said that video service is its largest service in terms of revenues generated and, "Although providing video services is a competitive and highly penetrated business, we expect to continue to increase video revenues through the offering of advanced digital video services, as well as through price increases and digital video customer growth, offset in part by basic video customer losses."
In another part of the discussion, Suddenlink said, "We expect that our video service margins as a percentage of video service revenues will continue to decline over the next few years as increases in programming costs outpace growth in video service revenues, and are not certain we will be able to pass all such increases on to our customers.
"However, in order to mitigate such a decline in our video service margins, we continue to review our pricing and programming packaging strategies."
Contact writer George Hohmann at email@example.com or 304-348-4836.