BALTIMORE–In a move that will lead to the creation of 60 jobs in the Baltimore area, TRF Private Equity announced today that it will invest $1.75 million in MidAtlanticBroadband, a niche telecommunications company.
The investment will be made through Urban Growth Partners, a private equity fund supported in part by Baltimore-area foundations.
Baltimore-based MidAtlanticBroadband (MidAtlantic) provides telephone, high-speed data communications and internet access to small- and medium-sized businesses as well as residences located in underserved areas. TRF’s investment will support MidAtlantic’s acquisition of Protel Services, a telecommunications provider based in Wichita Falls, Texas. Protel’s contracts cover more than 24,000 access lines.
MidAtlantic expects to create the 60 new jobs over the next five years as the company expands its customer service center and relocates Protel’s headquarters from Wichita Falls, Texas, to Baltimore. Joining TRF in this round of financing are the Maryland Small Business Development Financing Authority and Community Development Ventures Inc., managed by MMG Ventures Inc., which are currently invested in MidAtlantic. Debt financing for the Protel acquisition is through BB&T Bank.
“MidAtlantic has been extremely encouraged by the level of support we’ve received from public officials and our investors,” said Willie Vereen, President of MidAtlanticBroadband. “We are pleased to build our workforce in Baltimore with TRF’s help.”
The investment in MidAtlantic is consistent with the Urban Growth Partners’ goal of supporting companies that can provide positive financial results while creating much-needed jobs for low- and moderate-income workers.
“We are excited about MidAtlanticBroadband’s revenue growth potential and its ability to create job opportunities in the Baltimore area,” said Peter Askey, TRF Private Equity’s managing director. “The opportunity to combine a social return and an economic return to its investors is tremendous.”
TRF Private Equity, an affiliate of The Reinvestment Fund, generates economic development by investing in high-growth companies located in or near Mid-Atlantic cities. TRF works closely with the management teams of its portfolio companies, providing advice, workforce development assistance and a network of partners and resources. TRF has significant capital remaining in its funds and is looking for new investment opportunities in the Baltimore market, Askey said.
TRF Private Equity manages approximately $60 million of committed capital in two funds, DVCRF Ventures and Urban Growth Partners. DVCRF Ventures has made 13 investments leading to the creation of more than 1,600 jobs for low- and moderate-income urban workers.
Urban Growth Partners was launched with the support of national and regional financial institutions, philanthropic entities and concerned citizens. The largest investor in Urban Growth Partners is The Baltimore Fund, which raised $15 million in capital to invest in companies that will create jobs for low-income workers.
The lead investors in the Baltimore Fund are the Open Society Institute-Baltimore and The Annie E. Casey Foundation.
“This investment in MidAtlantic Broadband will improve economic opportunities for dozens of workers in Baltimore city,” said Diana Morris, director of OSI-Baltimore. “We look forward to seeing the company continue to grow and create critically needed jobs here.”
Douglas W. Nelson, president of the Casey Foundation, said more such investments are needed in Baltimore. “The Baltimore Fund is an important vehicle for supporting economic and workforce development in poor communities. These kinds of investments help build the skills of many Baltimore workers,” Nelson said.
Other investors in the Baltimore Fund include The Jacob and Hilda Blaustein Foundation, France-Merrick Foundation, The Morris Goldseker Foundation, The Aaron and Lillie Straus Foundation, The Zanvyl and Isabelle Krieger Foundation, The Alvin and Fanny B. Thalheimer Foundation, Deutsche Bank, the Baltimore Community Foundation, the Hoffberger Foundations, The Fund for Change, and Johns Hopkins University.