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Choice One Communications and CTC Communications Finalize Merger, Simultaneously Complete Acquisition of Conversent Communications; Telecommunications Services Companies Announce New Name

Posted on: Monday, 3 July 2006, 09:00 CDT

Choice One Communications, CTC Communications and Conversent Communications jointly announced today the completion of their previously announced combination. The merged organization will be called "One Communications" as of July 24th and will serve businesses in sixteen states within the Northeast, Mid-Atlantic and upper Midwest regions. With revenues of over $800 million, One Communications is the largest privately-held competitive local exchange carrier in the United States.

"This transaction transforms three telecommunications companies that were strong in their own right into a single broadband IP-based telecommunications powerhouse," said Thomas J. Casey, CEO of One Communications. "We will offer a unique combination of advanced telecommunications solutions and exceptional customer service. Businesses throughout our target markets will benefit from a new competitor that is large enough to make substantial investments in enhanced services while being nimble and focused enough to serve every customer with exceptional support provided by accessible and friendly experts."

The One Communications network spans from Maine to West Virginia and the eastern seaboard to Wisconsin. The company will maintain substantial operations centers in Rochester, NY; Waltham, MA; Marlborough, MA and Charleston, WV. In addition, One Communications will maintain dozens of regional offices in local business communities to serve small and medium sized business customers.

Financing for the transaction includes a $75 million additional equity investment by both Columbia Ventures Corporation (the sole shareholder of CTC Communications), and Choice One shareholders (backstopped by Camulos Capital LP and Varde Investment Partners LP), and a $590 million credit facility arranged by Goldman Sachs Credit Partners LP. The credit facility includes $30 million in revolving credit, a $435 million first lien term loan, and a $125 million second lien term loan. Proceeds from the debt and equity offerings enabled the company to refinance existing debt, purchase 100% of the outstanding shares of Conversent and fund transaction and merger integration costs and provide additional working capital.

The Choice One Board was advised by The Blackstone Group L.P.'s Corporate Advisory Services team, Akin Gump Strauss Hauer & Feld LLP, and Mintz Levin Cohn Ferris Glovsky & Popeo P.C. Choice One's largest shareholder is an advisee of Camulos Capital LP. The CTC Board was advised by Columbia Ventures Corporation and Kelley Drye & Warren LLP. The Conversent Board was advised by Miller Buckfire and Co., LLC and Edwards, Angell Palmer and Dodge, LLP.

In February 2006, Choice One and CTC announced their merger of equals. In March 2006, Choice One and CTC announced their intent to purchase Conversent Communications including FiberNet, Conversent's provider of communications services in West Virginia.

About One Communications

One Communications is a leading integrated communications provider that offers a broad portfolio of advanced telecommunications solutions tailored to meet the individual needs of small and medium sized businesses in 16 states across the Northeast, Mid-Atlantic and upper Midwestern United States. The largest privately-held provider of telecommunications services in the country, One Communications represents the integrated companies of Choice One, CTC Communications, Conversent and FiberNet. The company operates a network with an IP core supported by nearly 10,000 route miles of fiber connecting 700 unique collocation sites. This network density, combined with the company's advanced network technologies, enables One Communications to provide high value services at competitive prices. Visit One Communications on-line at www.onecommunications.com

Source: Business Wire

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