Cogent Raises $41M, Restructures Debt

Cogent raises $41M in cash to fund operations and restructuring, cuts debt from over $380M to $27M and extends repayment terms

June 19, 2003

2 Min Read

WASHINGTON -- Cogent Communications Group, Inc. (AMEX: COI), a Tier One, next generation, optical Internet service provider, announced today that it has reached agreement to restructure its debt and raise $41 million in cash equity from investors that will be used to fund the operations and the restructuring. Over the last six months, Cogent has reduced its total debt from a face amount of over $380 million to $27 million and extended repayment terms, with the company’s first principal payment due in 2006. The transactions are subject to execution of final documents and certain closing conditions.

The equity financing will be provided by JVP (Jerusalem Venture Partners), Oak Investment Partners, Worldview Technology Partners, Broadview Capital Partners, Boulder Ventures, and Nassau Capital. Following the transaction the investors, Cisco Capital, and employees will own 99% of the company.

“This is an exceptional round for Cogent and its investors, as the company has significantly outperformed the sector while greatly limiting its debt exposure,” said Erel Margalit, managing partner, JVP. “We look forward to Cogent’s continued growth as it positions itself to take full advantage of the telecom recovery.”

“Cogent continues to perform well by providing value and service at a price per megabit that remains unmatched in the marketplace today,” said Dave Schaeffer, CEO Cogent Communications. Adding, “Cogent remains confident and focused in our ability to continue to provide value to customers looking for high quality, high capacity Internet service at an affordable price.”

“Cogent now has one of the strongest balance sheets in the ISP sector,” said Helen Lee, CFO Cogent Communications. “Moreover, with this financing the Company will have sufficient funds for its growth and operations.”

Cogent’s successful refinancing comes on top of several other recent corporate milestones in 2003, including the retirement of $107 million in subordinated debt, the lighting of Cogent’s 700th building with Internet service and the most recent acquisition of Fiber Network Solutions, Inc. out of Ohio.

Cogent Communications Group Inc.

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