Wednesday, July 14, 2010

Tech Valley Communications in Albany has received a major investment from a Boston-based private equity firm that will allow the Internet service provider to expand its fiber network and add 30 jobs over the next couple years.

The deal with Riverside Partners in Boston is expected to close in the next 45 days, following federal regulatory approvals, said Kevin O'Connor, CEO and co-founder of Tech Valley Communications. He declined to reveal the amount or terms of the investment, but called it "significant."

Tech Valley Communications will use the equity funding to expand its fiber optic network north to Saratoga Springs in Saratoga County, and Glens Falls in Warren County. In growing its customer base, the company will hire 30 new employees to install fiber and perform sales and office duties.

"This is the biggest hiring initiative we've ever engaged in as a company," said O'Connor, whose 64-person company has generally grown staff through acquisitions and mergers.

Tech Valley Communications began looking for private investors in 2008, but suspended the search when the recession hit. The company resumed the search this past January, and O'Connor said he met with at least 12 potential investors before deciding on Riverside.

"They really understand the region and what we are trying to do," he said. In 2005, Riverside paired with another equity firm to finance the $18 million acquisition of a Montreal wireless company by Sixnet, an electronics device manufacturer in Clifton Park.

Steven F. Kaplan, a general partner at Riverside Partners, said his company chose to invest in Tech Valley Communications because of its reliable, cost-effective services and "outstanding" reputation in the market.

"We believe Tech Valley Communications is poised for significant growth," Kaplan said.

Tech Valley Communications owns and operates 440 miles of fiber optic cable that connect commercial buildings in the Capital Region. In April, it broke into the residential market with a low-cost wireless service. Tech Valley Communications, formed in 1999, had $14.4 million in revenue in 2009, according to The Business Review's most recent list of privately held companies.