Ritter Communications of Jonesboro is looking for a partner, not a buyer.
Responding to a Wall Street Journal article published Friday, officials of the family-owned, regional broadband provider said that at this time the company is seeking investment partners only.
"It is not the objective to pursue an outright sale of Ritter Communications," Ritter President Alan Morse said in a statement to Arkansas Business. "We're looking for a partner who can help fund the acceleration of our business plan. We are currently evaluating several potential partners and both minority and majority investment proposals."
Morse said the process was ongoing and more information would be available by the end of the third fiscal quarter. Ritter has enlisted investment bank Cowen & Co. of New York City to help find an equity partner.
The Journal reported Friday that the company had initially been interested in bringing in a minority investor but that its thinking had evolved to include the possibility of selling a majority stake and was considering prospective "buyers," which included private equity firms.
Morse confirmed the company was seeking investment proposals, but not buyers.
"The decision to raise equity capital to support Ritter Communications was driven by its opportunity for faster growth," said Chip Dickinson, CEO of parent E. Ritter and Co. "Our board has directed management to find a compatible equity partner that embraces our shareholders' commitment to our employees and the communities we serve."
Ritter operates an enterprise-services, fiber optic network across Arkansas and western Tennessee and provides residential voice, video and broadband service in several markets. The Journal report said Ritter generates "roughly" $30 million in earnings but, while not releasing revenue or earnings figures, Morse said the company's earnings before interest, taxes, depreciation and amortization (EBITDA) figure is higher than that.
E. Ritter & Co. reported 2018 revenue of $109.2 million. It ranked No. 73 on Arkansas Business' most recent list of the state's 75 largest private companies, with 2017 revenue of $138 million. Its subsidiaries include Ritter Communications and Ritter Agribusiness.
Founded in Marked Tree, Ritter began providing local phone service in the early 1900s. In addition to its Jonesboro headquarters, the company has offices in Marked Tree, Searcy, Jasper, Blytheville, Harrison, Little Rock; Millington, Tennessee and Munford, Tennessee.
Ritter recently broke ground on an $8 million, 8,882-SF cloud and data storage center next to its headquarters in Jonesboro, signaling its intent to extend service beyond larger population centers. In February, it announced a $7 million infrastructure project to underpin a high-tech communications and business services system in Hot Springs.
The search for new shareholders marks an effort to accelerate its expansion and fiber deployment after five years of significant growth, Morse said.
"Our focus remains our customers and providing them with the products and services they need to be successful," Morse said. "We continue to expand our state-of-the-art fiber network, invest in technology and grow our business. Our 'Right by You' pledge to our customers and communities will be further supported with a new equity partner."