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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
August 20, 1997 (August 1, 1997)
C-TEC CORPORATION
(Exact name of registrant as specified in its charter)
Pennsylvania 0-11053 23-2093008
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
105 Carnegie Center, Princeton, NJ 08540
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(609) 734-3700
(Former name or former address, if changed since last report).
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Item 5. Other Events
On August 1, 1997, Potomac Capital Investment Corporation (PCI),
an unregulated subsidiary of Potomac Electric Power Company (PEPCO) and RCN
Corporation (RCN), a subsidiary of C-TEC Corporation, entered into a letter of
intent to form a joint venture to provide Washington, D.C. area residents and
businesses local and long-distance telephone, cable television and Internet
services as a package from a single source.
The joint venture will be equally owned by PCI and RCN, and each
will invest up to $150 million over the next three years to provide the
"bundled" services over an advanced fiber optic network. Initial network
construction will begin in the District of Columbia and portions of Maryland and
Northern Virginia. Within three years, the new company plans to offer to more
than 40 major communities the bundled services that include the first
full-service alternative to current cable television providers. In advance of
the buildout of the fiber optic network, a competitive package of local and
long-distance telephone and Internet services will be offered throughout the
Washington area. The joint venture, which will be headquartered in the District
of Columbia and will have more than 200 employees, could ultimately expand to
more than 200 communities.
PCI is a wholly-owned subsidiary of PEPCO. PEPCO provides electric
service to 682,000 businesses and households in the Washington, D.C. and the
Maryland suburbs. PCI conducts PEPCO's ongoing nonutility businesses and has
been operated separately from the regulated utility since its inception in 1983.
Consummation of the joint venture is subject to certain conditions, and
there can be no assurances that any transaction will take place.
Item 7. Exhibits
(c) Exhibits
99 Press release of C-TEC Corporation and Potomac Electric Power
Company dated as of August 6, 1997 announcing the Agreement to
form a joint venture to provide Washington, D.C. area residents
and businesses local and long-distance telephone, cable
television and Internet services as a package from a single
source.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
C-TEC Corporation
By: \s\ Bruce C. Godfrey
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Name: Bruce C. Godfrey
Title: Executive Vice President
and Chief Financial Officer
Date: August 20, 1997
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For Immediate Release Contacts: Nancy Moses,
August 6, 1997 202-872-2680
Jim Maiella, RCN
212-376-4399
PEPCO Subsidiary Joins RCN Corporation to Bring Washington Area
A Single-Source Package of Telecommunications and Cable Services
. News Conference August 6, 10:30 a.m. Sheraton Washington; Connecticut &
Woodley (Kansas Room)
. To participate in the news conference by telephone, call 1-800-263-9155
. Replay of the news conference until August 8, 1997: 1-800-633-8284
(PIN 3009364)
Washington, DC -- Potomac Capital Investment Corporation (PCI), an
unregulated subsidiary of local utility Potomac Electric Power Company (PEPCO),
today announced an agreement to form a joint venture with RCN Corporation (RCN)
to provide Washington-area residents and businesses local and long-distance
telephone, cable television and Internet services as a package from a single
source.
The joint venture will be equally owned by PCI and RCN, and each will
invest up to $150 million over the next three years to provide the "bundled"
services over an advanced fiber optic network. Initial network construction will
begin in the District of Columbia and portions of Maryland and Northern
Virginia. Within three years, the new company will be offering to more than 40
major communities the bundled services that include the first full-service
alternative to current cable television providers. In advance of the buildout of
the fiber optic network, a competitive package of local and long-distance
telephone and Internet services will be offered throughout the Washington area.
The joint venture, which will be headquartered in the District of Columbia and
will have more than 200 employees, could ultimately expand to more than 200
communities.
PEPCO President John M. Derrick, Jr., said, "Through this venture,
PEPCO is responding to the desires of our technology-savvy customers who want
many communication options yet simplicity of service. By becoming an integrated
provider of energy and
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telecommunications services in the Washington metropolitan area, PEPCO will be
better able to successfully compete in a deregulated environment."
"We had always planned to launch RCN in Washington," said David C.
McCourt, Chairman and CEO of RCN Corporation. "But the overwhelming demand for
our bundled telecommunications services in New York City and Boston encouraged
us to enter this market earlier than we had originally anticipated. Washington
is a fantastic market for this joint venture, because the population craves
information and access to the type of services it will provide."
RCN is the nation's first and largest facilities-based
telecommunications company to offer a package of competitive local and long-
distance telephone, cable television and high-speed Internet access to
residential and commercial customers over advanced fiber optic networks. RCN
currently provides bundled telecommunications services in New York City and, in
concert with Boston Edison, in the Boston metropolitan area.
PCI President John D. McCallum said, "The recent Telecommunications Act
has given us the opportunity, and competition has given us the impetus, to offer
area customers a superior, price-competitive, integrated telecommunications
service. We are very pleased to have found a partner with the depth of
telecommunications experience, reputation and strength of RCN."
"When we decided to enter the Washington market, we evaluated a list of
potential local partners and PCI and its parent, PEPCO, were head and shoulders
above the other candidates. We are thrilled to be in business with a company
that has such deep roots in the community and such a demonstrated commitment to
quality service and customer care," McCourt said.
PCI is a wholly owned subsidiary of PEPCO (NYSE:POM). PEPCO provides
electric service to 682,000 businesses and households in the Washington, D.C.
and the Maryland suburbs. PCI conducts PEPCO's ongoing nonutility businesses and
has been operated separately from the regulated utility since its inception in
1983.
RCN is a subsidiary of C-TEC Corporation (Nasdaq: CTEX, CTEXB),
headquartered in Princeton, NJ. C-TEC has received approval from the Internal
Revenue Service to spin RCN off
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into its own separate, publicly-traded company. It is anticipated the spin will
occur by the end of 1997 and that RCN will trade on The Nasdaq Stock Market.
Consumers can reach PCI by calling 202-775-4623 and RCN by calling
1-800-RINGRCN. Information can also be obtained by visiting RCN's site on the
World Wide Web at www.rcn.com.
