This summary highlights information contained elsewhere in this prospectus.
This summary may not contain all of the information you should consider before
tendering your notes for the notes offered hereby. We urge you to read this
entire prospectus carefully, including the "Risk Factors" described herein.
Our company was formed in 1997 to acquire, operate and develop cable
television systems in mid-sized markets we believe to be attractive. Our
strategy is to assemble two or more regional clusters, each consisting of
200,000 to 300,000 basic subscribers. We believe that our cluster strategy will
allow us to achieve economies of scale while maintaining geographic diversity
for our company as a whole. As of December 31, 1998, on a pro forma basis
giving effect to all our completed and pending acquisitions:
. we were one of the leading cable system operators in the State of
. we were one of the 30 largest multiple system cable operators in the
. our systems would have passed approximately 403,600 homes; and
. our systems would have served approximately 247,300 basic subscribers, of
which approximately 221,200 are located in Michigan and approximately
26,100 are located in western New England and upstate New York.
Our Operating Clusters
We currently operate in two regional areas: the Michigan Cluster and the New
Our Michigan Cluster. On November 6, 1998, we established our Michigan
Cluster by completing our acquisition of Cable Michigan for approximately
$425.9 million. We acquired Cable Michigan because of its strong growth
prospects. We believe that there are good growth prospects for the communities
Cable Michigan serves and good opportunities to increase penetration rates,
which refers to the percentage of homes in a given area that purchase cable
In March 1999, we acquired the approximately 38% of the shares of Mercom,
Inc. that Cable Michigan did not own at the time we acquired Cable Michigan for
total consideration of approximately $21.9 million. In addition, we have
acquired, for a combined purchase price of approximately $13.3 million, the
. cable television systems from Nova Cablevision, Inc., Nova Cablevision
VI, L.P. and Nova Cablevision VII, L.P. which had approximately 6,400
basic subscribers as of March 1999;
. cable television systems from Cross Country Cable TV, Inc. which had
approximately 1,900 basic subscribers as of January 1999,
. assets of Novagate Communications Corp., an Internet service provider
which had approximately 5,000 Internet subscribers as of March 1999, and
. cable system assets of R/COM, L.C. which had approximately 800 basic
subscribers as of March 1999.
We have also entered into agreements to acquire assets of Traverse Internet,
Inc., an Internet service provider which had approximately 5,000 Internet
subscribers as of March 1999, and certain cable system assets of Galaxy
American Communications which had approximately 600 basic subscribers as of
March 1999. The combined purchase price for these pending transactions is
approximately $2.9 million.
As of December 31, 1998, on a pro forma basis, we had a total of 221,200
basic subscribers and 10,000 Internet subscribers in our Michigan Cluster,
after giving effect to all completed and pending transactions.