[January 23, 2017]

Lumos Networks Announces Closing of Clarity Communications Acquisition

Lumos Networks Corp. ("Lumos Networks") (NASDAQ: LMOS), a leading fiber-based service provider in the mid-Atlantic region announced it recently completed the closing of its acquisition of Clarity (News - Alert) Communications Group ("Clarity"), in line with prior guidance of a first quarter of 2017 closing. Clarity operates a 730 mile fiber network with 75 on-net locations with the vast majority of its operations in the state of North Carolina.

Timothy G. Biltz, CEO of Lumos Networks, said, "I am excited to announce the closing of our acquisition of Clarity Communications and we are thrilled to welcome the founders of Clarity, Todd Peverall and Andy Carwile and the rest of the Clarity team onto the Lumos fiber platform. We look forward to a productive year as an integrated unit in 2017 as we leverage their military sales channel expertise and pursue opportunities in North Carolina, which is now our 26^th Enterprise Market."

"Given the favorable metrics of this transaction, including the imputed adjusted EBITDA multiple, we view the Clarity acquisition as we would an organic transaction requiring upfront capital spending to produce sustainable high-quality fiber revenue," Mr. Biltz noted. "However, the fiber EBITDA derived from the Clarity transaction bolstered our financials immediately upon closing rather than having to complete a fiber build that could take many months to complete. Simply put, Clarity is already a contributing factor in Lumos achieving the necessary scale needed to become a pure play fiber bandwidth infrastructure company."

Mr. Biltz continued, "Further, I am happy to report that our sales teams have already begun to cross-sell Clarity's extensive expertise into the military channel across our entire footprint of more than 9,200 fiber route miles. We believe there are 409 military installations in the existing Lumos Networks footprint and estimate that the total military networking addressable market is $44 million. Further, we estimate non-military data networking spend near Clarity's network is $88 million."

"This transaction gives us an instant foothold within the Carrier and Enterprise verticals in many high growth North Carolina markets and gives us a new sales channel into various government end markets, including military installatons and e-rate," finished Mr. Biltz.

About Lumos Networks

Lumos Networks is a leading fiber-based service provider in the Mid-Atlantic region serving Carrier, Enterprise and Data Center customers, offering end-to-end connectivity in 24 markets in Virginia, Pennsylvania, West Virginia, Maryland, Ohio and Kentucky. With a fiber network of 9,204 fiber route miles and 475,507 total fiber strand miles, Lumos Networks connects 1,297 unique Fiber to the Cell sites, 1,642 total FTTC connections, 36 data centers, including 7 company owned co-location facilities, 1,984 on-net buildings and approximately 3,300 total on-net locations. In 2015, Lumos Networks generated over $114 million in Data revenue over our fiber network. Detailed information about Lumos Networks is available at www.lumosnetworks.com.

SPECIAL NOTE FROM THE COMPANY REGARDING FORWARD-LOOKING STATEMENTS

Any statements contained in this presentation that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements and should be evaluated as such. The words "anticipates," "believes," "expects," "intends," "plans," "estimates," "targets," "projects," "should," "may," "will" and similar words and expressions are intended to identify forward-looking statements. Such forward-looking statements reflect, among other things, our current expectations, plans and strategies, and anticipated financial results, all of which are subject to known and unknown risks, uncertainties and factors that may cause our actual results to differ materially from those expressed or implied by these forward-looking statements. Many of these risks are beyond our ability to control or predict. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, forward-looking statements speak only as of the date they are made. We do not undertake any obligation to update or review any forward-looking information, whether as a result of new information, future events or otherwise. Important factors with respect to any such forward-looking statements, including certain risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, include, but are not limited to: the impact of the acquisition of Clarity Communications on our operations; rapid development and intense competition with resulting pricing pressure in the telecommunications and high speed data transport industry; our ability to grow our data business on an organic or inorganic basis in order to offset expected revenue declines in legacy voice and access products; our ability to obtain new carrier contracts or expand services under existing carrier contracts at competitive pricing levels to offset churn and achieve revenue growth from our carrier businesses; our ability to separate our legacy business on a timely basis; our ability to effectively allocate capital and timely implement network expansion plans necessary to accommodate organic growth initiatives; our ability to complete customer installations in a timely manner; adverse economic conditions; operating and financial restrictions imposed by our senior credit facility and our unsecured debt obligations; our cash and capital requirements; our ability to maintain and enhance our network; the potential to experience a high rate of customer turnover; federal and state regulatory fees, requirements and developments; our reliance on certain suppliers and vendors; and other unforeseen difficulties that may occur. These risks and uncertainties are not intended to represent a complete list of all risks and uncertainties inherent in our business, and should be read in conjunction with the more detailed cautionary statements and risk factors included in our SEC (News - Alert) filings, including our Annual Report filed on Form 10-K.

View source version on businesswire.com: http://www.businesswire.com/news/home/20170123005911/en/

[ Back To TMCnet.com's Homepage ]