Bell officially exits broadband
Cincinnati Bell’s 3-year experiment in the national broadband cable business came to an end Friday when the company unloaded its 18,700-mile fiber optic cable network.
The final sale price was $91 million, 29 percent less than the originally announced price of $129 million and a tiny fraction of the more $3 billion that Broadwing Inc. spent to acquire and complete construction of the network.
St. Louis-based C III Communications, a partnership between Corvis Corp. and Cequel III, also will pay Cincinnati Bell $17 million for other “working capital” that is owned by Bell.
Payment on the $17 million will be deferred for a year.
Cincinnati Bell operated as Broadwing until it reverted back to its original name late last month.
The sale was finalized on Daniel J. Meyer’s final business day as chairman of the board.
The closing of the sale opens a seven-day window for CEO Kevin Mooney, whose contract, renegotiated in February, contains a clause that allows him to leave the company within the seven days with a bonus that is equal to his $660,000 salary plus a bonus that is equal to his salary.
Mooney said Friday evening he hopes to continue working as the CEO of a company that is refocusing on its business as a regional telephone company.
“If the board wants me to stay, I’d like to stay. It would be my intention to stay on with the company,” he said.
Mooney said he hopes to talk with new board chairman Phillip R. Cox early next week.
If Mooney would leave, he would receive the $1.32 million bonus for closing the sale plus two years of severance pay and bonus, another $2.64 million.
Three other top executives have similar clauses in their contracts that give them 180 days to make a decision about taking their bonuses and leaving the company.
Chief Financial Officer Thomas Schilling; Jeffrey C. Smith, the chief human resources officer, general counsel and corporate secretary, and Michael W. Callaghan, senior vice president of corporate development, have contracts that call for a bonus equal to half their annual salary plus their regular bonuses.
The sale price was cut from $129 million to $91 million plus the $17 million for other property and equipment because of the company’s financial performance during the first quarter and its decision not to make other investments in the network before it was sold, a company spokesman said.