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Tech Industry

NuVox gets new funds, cuts staff

NuVox Communications raised $78.5 million in fourth-round financing, the telecommunications company said Wednesday. Of that, $66 million was in equity financing from Goldman Sachs, J.P. Morgan Partners, Whitney & Co. and Meritage Private Equity Fund. The St. Louis-based company also received $12.5 million in debt financing from General Electric Capital and CIT Lending Services.

NuVox, which sells Internet access with local and long-distance phone service to small and medium-sized businesses, has used the funds to pay down some of its existing debt and will use the rest to fund operations, said CEO David Solomon. NuVox expects to be cash-flow positive by the fourth quarter of 2004, he said. As part of the new funding and the restructuring of its debt, NuVox scaled back some operations, reducing its headcount over the last 60 days from 1,000 employees to 850, Solomon said. The job cuts targeted the direct sales force and back-office operations. NuVox has raised a total of about $500 million, Solomon said.