Advertisement

Archive for Saturday, October 16, 2010

Sale of Sunflower Broadband complete

In a deal valued at $165 million that was finalized on Friday, Knology Inc., a Georgia-based communications company, formally acquired Sunflower Broadband, which is located at One Riverfront Plaza in Lawrence, from The World Company.

In a deal valued at $165 million that was finalized on Friday, Knology Inc., a Georgia-based communications company, formally acquired Sunflower Broadband, which is located at One Riverfront Plaza in Lawrence, from The World Company.

October 16, 2010

Advertisement

After more than 40 years of family ownership, Sunflower Broadband has a new public parent.

Knology of Kansas Inc., part of a Georgia-based communications company, formally acquired Lawrence-based Sunflower on Friday in a deal valued at $165 million.

The sale ends Sunflower’s ownership by The World Company, whose Sunflower Cablevision had started providing cable-television programming and services in January 1972. It would later become Sunflower Broadband, expanding into Internet, telephone and other services.

Today’s Sunflower customers — more than 33,000 for video, 28,000 for Internet and 15,000 for telephone in Douglas, Wyandotte and Leavenworth counties — won’t notice much, if any, difference in products or services, at least in the short term, said Rod Kutemeier, general manager for Knology of Kansas Inc., a division of Knology Inc., which is based in West Point, Ga.

Customers will continue to use the same phone numbers, pay the same rates, enjoy the same channels and rely on the same local customer service that they’ve grown accustomed to, Kutemeier said.

Even the Sunflower Broadband name will remain, at least for now.

“There should be no changes in the immediate future,” said Kutemeier, who had been general manager for Sunflower. “Any changes in the future will be expansions of our current services.”

Such changes will be expected to be “gradual,” he said, and come with plenty of advance notice: at least 30 days for adjustments to rates or levels of service.

“There are no changes on the docket at this point,” Kutemeier said.

Sunflower’s 200 employees now become Knology employees, a staffing level expected to remain in place at least until Dec. 31, Kutemeier said. Knology also now owns Free State Studios, which will continue to provide local shows such as “Jayni’s Kitchen,” “1 on 1 Trivia” and others.

Knology also owns 6News, which will continue to provide news programming six nights a week.

“This is an exciting transaction for our company,” said Rodger L. Johnson, Knology’s chairman and CEO, in a statement. “Sunflower is a very successful, customer-focused business that will expand Knology’s footprint and add meaningful scale to our existing operations. We welcome the Sunflower team to Knology and are excited about our future together.”

The World Company continues to own and operate the Lawrence Journal-World, as well as other business ventures.

Comments

inklines 4 years ago

Will the online LJW still feature channel 6 video clips?

0

Ralph Gage 4 years ago

Yes, at least until Channel 6 has its own web site. The news teams will share resources but each will control its own assignments. Plans are for a multi-media, multi-team effort to cover elections, and to work together on major breaking news efforts. Eventually, the Channel 6 team that's presently working from the News Center will relocate to space owned or leased by Knology.

0

Richard Heckler 4 years ago

Expect lay off's and perhaps increased rates. This is traditionally what takes place to ease the pain of a high dollar purchase.

Let's hope for the sake of sunflower employees I'm wrong.

0

mr_right_wing 4 years ago

...and I'm expecting most of you will be dropping the serviice altogether; after all, now it's owned by a big, unfeeling, evil, nasty, uncaring, greedy corporation.

0

jafs 4 years ago

If rates go up, and they lay off employees, why would we continue to support them?

My experiences with Sunflower to date have generally been good ones - I'd be sorry to see that change.

0

Keith 4 years ago

"...and I'm expecting most of you will be dropping the serviice altogether; after all, now it's owned by a big, unfeeling, evil, nasty, uncaring, greedy corporation."

What changed exactly?

0

Sparko 4 years ago

Maybe they can outsource everything. The Chamber of Commerce Way.

0

Bobo Fleming 4 years ago

There is competition. So I think rates will not change a lot. Direct TV is now broadcasting 1 3d football game per week.

0

dogsandcats 4 years ago

So what is going on with "dsimons" trying to sell the Sunflower Broadband offices to the library???? See his posts here: http://www2.ljworld.com/news/2010/oct/10/destination-library-voters-will-be-asked-approve-e/#c1390936 and here: http://www2.ljworld.com/news/2010/oct/15/library-support/#c1392903

Is Knology closing the local customer service center?

0

jafs 4 years ago

It looks like Simons is selling off his stuff.

0

Sagecasey 4 years ago

This is a big blow to not only Sunflower employees,but the Lawrence community as well. Sunflower purchased all of their vehicles locally and had them insured by local insurance agents. They purchased office supplies locally. Knology will probably purchase from their own suppliers. Knology purchasing Sunflower takes not only jobs away from people, but also removes thousands of dollars from the local community.

0

Sparko 4 years ago

Excellent post--this is the core issue of what is wrong with these mergers. God knows Lawrence has enough bottom line issues killing the local economy, but all the efficiencies this parent company adds will not drive down the cost to local consumers one dime--indeed, prices will go up to finance this deal.

0

cmdln 4 years ago

Yes, its so sad that the loving local company will be swallowed by a big evil behemoth. I mean wage freeze, and cutting 401k contribution on Jan1, when they had to have been already planning to sell the company off to a company they obviously don't expect to keep many employees as they are offering up the mall as library space, and the final insult of terminating flexible spending accounts months early with days notice is such a kind service to the community. Simons/The World Company seems to be doing a huge cash grab, and I don't see any plans of putting it back into the community. Gee I think the community will really miss all that tender care. It will be interesting to see what they decide to do with LJ in the coming years as most papers are facing financial troubles.

0

somebodynew 4 years ago

Sagecasey - while you may be correct, just how are you so sure of this already??? I know that is a possibility, but you seem to think it is a done deal.

As far as dsimons on his posts - At least he is honest upfront as to who he is and his interest. And he presents some really good ideas that seemed to have been ignored or overlooked. And I don't think any of them cost $18 million is taxpayer dollars.

0

jafs 4 years ago

They would cost $11 million. Still not chump change.

0

just_another_bozo_on_this_bus 4 years ago

Now that the Simons family has $165 million in spare change laying around, they'll likely need some tax deductions. What better way than donating the $11 million towards renovating the Riverfront property into the new city library?

0

cmdln 4 years ago

They are great ideas, and frankly I think the Mall would be a sweet library. Very unique to say the least. But the issue here is the community benefactor like status people give to the Simons, when all they are trying to do is line their pockets. Sell sunflower, without regard to the employees who have served them for years, sell the mall, etc .. Not that they have to, but are they putting all that money back into the community? Are they creating more jobs? Not that I have heard, so dont try to say they are so great for the community.

0

cmdln 4 years ago

I'm not saying by any means we should be doing the library project at with the economy in its current state. We really cant afford to do that right now. But if we had (which we don't) to do something i like the mall idea.

0

JM Andy 4 years ago

I moved back to the area recently and specifically chose to go with Sunflower because it was owned LOCALLY. So much for that. I'll be switching soon, I'm sure. I have no doubt that prices will "gradually" increase and customer service will "gradually" diminish.

0

jafs 4 years ago

What local company will you switch to?

0

Randall Uhrich 4 years ago

Local customers are screwed. Get ready to pony up more cash for less service. You can count on it.

0

ksjayhawk74 4 years ago

Remember when 105.9 the Lazer, when it was the Lazer, was sold to a big company and there were not going to be any changes that you could notice?...

0

cmdln 4 years ago

I wouldn't paint the Simons or The World Company in such a favorable light. They have always touted and advertised themselves as the local company who "cares". It seems they just hung their employees out to dry by terminating Flexible Spending Accounts early, and giving just a few days notice to spend or lose the funds. http://www2.ljworld.com/weblogs/word-on-the-street/2010/oct/15/the-world-company-gives-t/ Of course its possible Knology and The World Company couldn't come to an agreement about extending employee benefits to the normal plan end. But if The World Company was so caring about the local community and their employees who have worked so hard and made them so much money over the years they could have at least offered to refund the balances. Perhaps they have and I haven't heard. But Ive seen no mention of the subject.

Whats up with that? And it seems clear if Dan is planning on selling off mall space (http://www2.ljworld.com/news/2010/oct/10/destination-library-voters-will-be-asked-approve-e/#c1390936, and http://www2.ljworld.com/news/2010/oct/15/library-support/#c1392903) there was some early knowledge that Knology (no pun intended) would be closing or at least vastly reducing local customer service operations in lieu of facilities they already have. Now I don't blame Knology for a decision like that, its probably best for their company to leverage existing resources. But I think its unfair to paint the Simons and The World Company as being so kindly to the local community.

0

Ralph Gage 4 years ago

Our HR director, Kelly Calvert, gives this information: Sunflower Broadband employees’ last day with The World Company was Oct. 15, 2010. Participation in the Flex Spending Account ends at separation of employment.

In anticipation of this separation date, we sent an email to employees about a week before this separation date to remind them of the flexible spending account plan requirements for timely reimbursement for incurred expenses. This notification was provided to remind employees of the opportunity to incur expenses for any unused medical spending account funds before their separation date, if they were able to incur expenses for any unused funds. On Oct. 15, 2010, employees were provided the opportunity to receive written, benefits separation information with detailed instructions regarding what, if any, next steps employees may take to maximize their continuation of all benefits for which they were enrolled. The notification for Flexible Spending Accounts included the option for employees to elect COBRA continuation coverage if their Medical Spending Accounts were under-spent which would provide the employee with the opportunity to continue to use their medical spending account through the end of the calendar year and receive reimbursement up to 30 days past the end of the calendar year. In addition employees are able to continue to incur dependent care expenses after separation of employment through the end of the calendar year. This information was provided to employees:

Medical Flexible Spending Account

You have been a participant in the Medical Flexible Spending Account (“Medical FSA”). You may continue to submit un-reimbursed medical expenses up to the amount for which you are eligible until 30 days after the end of the plan year as long as expenses were incurred prior to the last day of your separation date.

In addition, COBRA coverage under the Medical FSA will be offered; however, it is only available to qualified beneficiaries losing coverage who have “underspent accounts.” A qualified beneficiary has an “underspent account” if the unused balance in the Medical FSA is equal to or more than the cost for Medical FSA COBRA coverage that will be charged for the remainder of the plan year. The use-it-or-lose-it rule will continue to apply, so any unused amounts will be forfeited at the end of the plan year, and COBRA coverage will terminate at the end of the plan year. All qualified beneficiaries who were covered under the Medical FSA component of the Plan will be covered together for Medical FSA COBRA coverage. However, each qualified beneficiary could alternatively elect separate COBRA coverage to cover that qualified beneficiary only, with a separate Medical FSA annual coverage limit and a separate COBRA cost. See the COBRA Continuation Coverage Election Notice that will be provided to you from OptumHealth Financial Services for additional information. (continued)

0

Ralph Gage 4 years ago

(continued from my preceding comment referencing information given to employees by our HR department):

Dependent Care Reimbursement Account

You have been a participant in the Dependent Care Reimbursement Account. You may continue to submit un-reimbursed amounts paid for qualified dependent care expenses until April 15 after the end of the plan year containing your separation date. Any such qualified dependent care expenses must have been incurred during the plan year containing your separation date (i.e., on or before December 31 of the plan year containing your separation date). This includes expenses incurred after your separation date. However, you will only be reimbursed for expenses up to the amount contained in your account as of your separation date. Qualified dependent care expenses may only be reimbursed if the expenses are incurred to permit you to be gainfully employed.

The World Company values its employees and fully appreciates the tremendous amount of change that the Sunflower Broadband employees are facing during this transition. In addition, we administer our benefit plans according to their respective plan documents. -- This is a complex situation and we have done our utmost to keep all our employees informed. Ralph Gage

0

cmdln 4 years ago

As I read that employees were notified that these benefits would not transfer with the sale of the division about a week before the sale was finalized. I was told the email went out at almost 6pm 10/8. Many employees may not check their work email on the weekend so that really leaves about 5 days to arrange using the remainder of their Flex Accounts. That doesn't leave much time to make an appointment and arrange time off to visit a Dr or do whatever other things you may want to do with your Flex balance. On top of the fact that many insurance plans will not cover procedures done inside a year. Leaving employees who have yearly checkups the last half of Oct, Nov and Dec in a rough position. On one hand they could go early (as stated above "if they were able to incur expenses for any unused funds", if they can get an appointment on such short notice) and use their flex account but have insurance not cover the office visit. The COBRA option is available. However I would think it likely that the cost of COBRA would outweigh the savings gained from being able to fully use any balance in a flex account (perhaps im wrong about that) and I assume Knology will be offering health coverage to their "new" employees. In my mind COBRA offering is just a technicality not much of a thank you. I don't think an employee should have even had to worry about that issue. The World Company and Knology should have worked out transfer of the plans to the end of the plan year. And in the event an agreement couldn't be reached The World Company would have only had to offer refunds of Flex Account balances for employees departing with the sunflower division.

I don't know, I just don't think a week (or less depending on your interpretation) notice that certain benefits are not following a sale, and are in fact terminating early is not a great way to honor valued employees for years of service. It is even more upsetting that those funds (at least to my understanding of how a flexible spending account works) are contributed by the employee and the employees don't receive a refund of their own funds contributed to a plan being terminated early, with short notice.

0

HaRDNoK9 4 years ago

The goal of every business is to maximize profits. How does that make them a "big, unfeeling, evil, nasty, uncaring, greedy corporation"? It is the goal of every consumer to get the best price. Does that make all consumers cheapskates? There are two sides to every market: suppliers and demanders. Even a pure monopoly cannot set it's prices so high that people are not willing AND able to buy their product. If they did, they would go out of business because even a pure monopoly relies on sales to grow their business.

There are non-price determinates of supply and demand, too. And where a company buys its office supplies, capital, etc is not one of them. If a company buys it's office supplies from somewhere else, it is not because they prefer to spend their money outside of their community, it is because as a consumer of office supplies, they are looking for the best price. In this way, they are able to offer their own product for a better price and maximize their profit because they can sell more.

If the local car dealers, insurance companies, office suppliers, etc. want to secure Sunflower Broadband's business locally, then they too will offer their goods and services for a lower price, and that equates to better prices for everyone. All of the naysayers will argue everything I say as usual, but the LAWS of supply and demand are not called LAWS because they can be disproved. Naysay all you like.

SB will likely provide a better product, better service, for a better price under it's new ownership. Knology thinks so anyway, or it would not have made the purchase. I can think of no company, (besides the Federal Government) that thinks it can make money by spending more than it takes in. And if you don't like the way they do business, then DON'T BUY FROM THEM. Their are two sides to every market, and the consumer is half of that equation.

0

jafs 4 years ago

Economics is not a hard science - "laws of supply and demand" are not akin to "laws of physics".

Knology doesn't have any interest in whether they provide a better service for a better price - all they're interested in is whether they can make a profit.

0

MyName 4 years ago

I don't think people understand the new company at all. Sunflower was focused more on being a "jack of all trades" kind of company where alot of stuff was done in house to try and figure out what new options would make them more money. Knology's focus is on going for the rural/exurban customers that Time-Warner &co. don't care about. They haven't historically been interested in new or better tech as their customers are just glad to have anything at all.

What this means is, expect service to not be as good as Time Warner anymore. Expect customer service to lag compared to where it was, which is understandable as they aren't even in this state anymore, and don't expect prices on their internet stuff to be any better than competitive when compared to DSL.

This is a good move for Knology, as it moves them up the tech chain a bit, and a good move for the people who made money off that $165M sale, but it won't necessarily be a good move for the customers.

0

mtorkzadeh 4 years ago

just another company selling the division of the company that they think will boost more profits and keep them afloat. this will be a big blow to Lawrence customers and EVERY SINGLE SFBB Employee.

0

Kontum1972 4 years ago

greed...just plain greed...

time will tell...

0

EJ Mulligan 4 years ago

I agree with all the concerns above about losing a local company and its impact on the local economy. It's too bad that not everyone appreciated it while we had it. Sunflower was unique and lasted much longer than similar ventures across the country. I'm very sad for all the employees and their families -- and the impact this will surely have on Lawrence.

I wish the Simons family would step up to the plate and share some of their wealth with the city in a visible way. They have contributed quietly to causes in the community for decades. This is the perfect time for them to assist the community as it struggles to recover from the loss of Sunflower. Homeless shelter? Library? Ballard Center? Recreation center?

0

cmdln 4 years ago

But a contribution to a public works project still isnt as beneficial as job creation in my mind. I would prefer to see them re-invest the money into the community. Instead of giving a few hundred thousand dollars for some project here and there.

0

KUinAussie 4 years ago

Dear Mr Ralph Gage,

So would you take this time to tell the journal world employees and its readers whether or not you have locked into a long term agreement with USAToday?

If you cannot publicly state there is a long term commitment, then what portion of profits of the sale of sunflower, are you going to use to 'prop up' the paper side of LJW?

You know as well as i do, that without propping up these local papers, without funding from USAToday, you will then outsource your printing operations as well.

I was a first hand casualty of your companies devious tactics, and I have friends that work for you that deserve better than what you are doing to them.

0

Ralph Gage 4 years ago

I'd be glad to meet with you.

0

jafs 4 years ago

Why wouldn't Sunflower have simply refunded any employee contributions into FSA's?

0

jafs 4 years ago

That hadn't been spent already, of course.

0

tirednhungry1 4 years ago

I'm already noticing a difference in the way my internet works. Certain URL's give me this message: "You don't have permission to access / on this server." WTF?

0

mtorkzadeh 4 years ago

the sale of SFBB does not have any effect over Internet Service at the present time. Check your proxy server settings it may help. if that does not work give SFBB a call.

0

KUinAussie 4 years ago

its possible, that the new transition, they could be determining, via their servers, what content they want to make available to you.

it would help to know what sites give you the error first

0

John Hamm 4 years ago

Keywords, "in the short term" "for now" English translation - Sunflower Broadband is dead and there's gonna be hell to pay.

0

whats_going_on 4 years ago

oh good grief, should have expected "sky is falling" comments on about 90% of this. Alas, I was right. I looked at some of Knology's other ownerships, and their prices were the same or lower than Sunflower. Chill the ___ out.

0

jafs 4 years ago

Unfortunately, I experienced the worst customer service I have ever experienced with AT&T.

0

KUinAussie 4 years ago

I still want to know what the world company plans to do, to secure the printing side of the business.

without USAToday, now that sunflower is gone, what revenue is going to prop it up?

there is no way the local papers will survive without selling out.

facts to consider:

the daily draw for the LJW, has never increased incrementally, unless you all want to pay ten dollars for a daily paper.

also, do not forget, advertising is down.

USAToday used to average about 45% advertisements to 65% news. It has been under 20% for over three now.

0

mtorkzadeh 4 years ago

thank you whats_going_on...i completely understand where people are worried and think their bill will "magically jump". it's within the policies that any rates or services changes that happen, the customer must get 30 days notice atleast. so from my perspective atleast, there are no rate changes yet and everything is OK. naturally any customers or employee's of SFBB are going to be concerned, but all the talk and conjuring up of "what if's" doesn't do anything at the current time but cause unneeded stress.

0

Christine Anderson 4 years ago

All I can say is, if my kid loses her job as a result of this buyout, I hope Knology goes down the toilet, and that Mr. Simon's teeth rot and fall out thru his shorts! (Oh chill, censors-that's supposed to be funny.)

0

mtorkzadeh 4 years ago

is that the only thing you can say? AT&T just gained a customer? anywhere you go and have cable or high speed internet, you will eventually encounter "something" that you don't like about the service whether it be the prices, the speed of data, or lack or programming, scheduling conflicts. these are common things. when a buyout happens everyone's response is to run to the door and leave before you "get burned". it may be true that some prices conflict with what they have. but you won't have the same local community care that you have here. there will always be something to "complain" about. in reality, technology is a blessing and a curse in disguise. there will never be a "perfect" provider.

0

MyName 4 years ago

The problem is that we're not even looking for a "perfect" provider. We just need internet that doesn't suck, and you can't even get that in most of the country. Freakin Canada has better internet service than we do.

0

Commenting has been disabled for this item.