Our client, New Age Communications Construction, earned headlines this week in the Cincinnati Business Courier for its acquisition by Davey Resource Group, Inc. The announcement comes after the closing of the deal in August 2018. The details of the transaction are available here. Read the full text article below, or subscribers can visit the Business Courier here. Thank you to Cincinnati Business Courier for consulting Footprint Capital’s Managing Director, Josh Curtis, on this story.
Cincinnati cable, telecom company gets acquired
A Cincinnati-based utility construction company that repairs and installs cable TV and telecommunications wires and equipment has been sold to a firm that’s among the largest employee-owned companies in the U.S.
New Age Communications Construction, based in Queensgate, was acquired by a unit of Kent, Ohio-based Davey Tree Expert Co. for an undisclosed amount.
The deal combines two companies that provide complementary services. If a storm hits or a road is being widened, New Age moves or repairs the cable wires while Davey cuts down the trees. Now, Davey, whose Davey Resource Group Inc. subsidiary made the acquisition, has both capabilities so the two companies don’t have to work separately on one job.
“This is a service expansion,” Josh Curtis, managing director of Footprint Capital, a Columbus-based investment banking firm with a Cincinnati office that advised New Age in the deal, told me. “It’s very synergistic.”
New Age had brought in Footprint nearly a year ago to help it explore the possibility of selling the company. Not long after that, Davey contacted New Age on its own to inquire about potentially buying it.
“It was coincidental that Davey reached out to them,” Curtis said.
Davey was a customer of New Age and had brought in the firm to handle the cable aspect on numerous projects in the past. It knew New Age quite well.
New Age was looking to sell because it wanted additional resources so it could expand the company and because one of its three shareholders is getting older and wanted to cash out, Curtis said. Davey’s interest helped seal the deal.
“It really came down to Davey’s reputation and what this meant to NACC in terms of growth,” Curtis said. “It’s a compelling opportunity.”
Jay Martin, New Age’s president and one of its owners, didn’t reply to requests for comment.
He pointed to Davey’s “reputation and substantial resources” in a news release while indicating the acquisition gives New Age plenty of opportunity to grow.
“We believe the joint service capabilities our combined teams provide offer a solution for our clients that is poised to meet the ever-growing demand for wireless infrastructure across the U.S.,” Martin said in the release.
New Age will keep all of its employees following the sale, Curtis said.
Davey Tree Expert has 9,500 employees, making it the 12th-largest employee-owned company in the U.S., according to the National Center for Employee Ownership. It’s the seventh-largest company that’s 100 percent owned by its employees. It generated $916 million in revenue last year and $22 million in profit, according to its financial statement filed with the Securities and Exchange Commission. Just nine Greater Cincinnati-based private companies are larger than Davey by revenue.
New Age operates in 12 states. It provides fiber, copper and cable TV services with expertise in aerial construction, underground placement, emergency restoration, design and maintenance, among other areas.