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Thursday August 24 9:25 AM ET WorldCom to get 14% stake in Canadian business service firm Bracknell Corp. TORONTO (CP) - Telecom giant WorldCom Inc. (NasdaqNM:WCOM - news) will end up with a key partner and 14 per cent stake in Bracknell Corp., a Canadian business services firm, after Bracknell acquires Able Telcom Holding Corp. (NasdaqNM:ABTE - news), a U.S. telecom network company. Bracknell, which has been focusing on high-tech services for commercial properties in the past year, announced the all-stock move for Able Telecom on Thursday, along with the planned alliance with WorldCom. "Bracknell will perform at least 75 per cent of WorldCom`s network buildout over the next six years," Bracknell said in a release. Able Telcom is a leader in the deployment of fibre-optic networks and the sixth-ranked U.S. broadband infrastructure services provider, Bracknell said. "Able`s capabilities in telecom networks complements Bracknell`s expertise in critical-use telecom facilities and in deploying intelligent network infrastructure within buildings," the company said. "As a result, Bracknell will be the only end-to-end telecommunication services company with the ability to deliver outside-plant fibre, inside-plant operating centres, in-building wiring, customer connections and wireless systems." After the Able Telcom acquisition, "Bracknell will have more than 50 per cent of its revenues from the rapidly expanding, higher-margin telecom infrastructure sector, up from virtually nothing 12 months ago," said chief executive Paul Melnuk. "We will also forge a valuable, long-term and preferred supplier relationship with WorldCom, one of the world`s largest communication companies." Able has reported annual revenue of $440 million US. Its shares on the Nasdaq stock market were valued at about $55 million US as of Wednesday. Melnuk said Able has had recent difficulties related to its transportation division, unprofitable construction projects and the effect of several lawsuits, but those matters should be settled soon. The acquisition is conditional on regulatory and shareholder approval, financing and completion of satisfactory due diligence. Bracknell will issue about 22 million common shares in the deal and seek a listing on Nasdaq. Bracknell is scheduled to report results for the third quarter ended July 31 on Sept. 5. Since June 1999, Bracknell has transformed its business, investing $250 million US in acquisitions related to new technology. The company provides infrastructure services to businesses across North America, serving the technology, telecom, industrial and commercial markets. On the Toronto stock market Wednesday, Bracknell shares gained 20 cents to $6.05. © The Canadian Press, 2000 |
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