Charter Communications Inc. has offered to purchase the assets and contracts of High Speed Access Corp. for about $73 million in cash and assumed debt.
The MSO said it has offered to buy contracts and assets related to its own systems, including HSA's call-center and network operations center in Louisville, Ky., and all HSA-owned equipment in Charter's headends and customer homes.
As a result of the offer, several Charter executives have resigned from HSA's board of directors, including Charter president Jerald Kent, senior vice president of corporate development Steve Silva and director William Savoy, according to a press release.
HSA has not accepted the offer, but in a press release said it would evaluate the proposal.
The data-over-cable provider has about 176,000 subscribers, with Charter representing the bulk of those customers. Charter and Vulcan Ventures Inc. — the investment arm of Charter chairman Paul Allen — agreed in December 2000 to invest about $75 million in HSA preferred stock.
HSA spokesman Andy Holdgate said that the Charter and Vulcan investment would fund HSA into the first quarter of 2002, but that allocation would not fully maintain its business plan.
"We have looked at additional funding and financing," Holdgate said.
HSA's board has formed a special committee to consider its strategic options, including a sale of the company or its assets, a merger, a consolidation or some other strategic transaction.
No decision has been made to accept or decline the Charter offer, Holdgate said. But if the offer is accepted, he said, HSA would have to determine what to do with its other non-Charter-related assets.
HSA has been moving away from its turnkey data solutions for about a year, said Holdgate. Other customers include Insight Communications Co., which HSA provides with sales, marketing and installation functions for its Road Runner high-speed-data customers in Columbus, Ohio.
"One of the needs for the board to evaluate is the impact [a deal] would have on our other operations, including serving customers for those other affiliates," Holdgate said. "One of the things that has been happening in tandem with [seeking out] funding has been the evaluation of our turnkey business."
Even if Charter did buy the assets, Holdgate said, it would not mean that HSA would necessarily go away. The company also has an agreement with Kabel NRW in Germany, has been investigating entry into the digital subscriber line business. It also has an agreement to be a third-party ISP for Time Warner Cable, he noted.
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