The Zayo Group, which operates a large metro and long haul fibre optic network in the UK, has signed a merger agreement to be acquired by Digital Colony Partners and the EQT Infrastructure IV fund in a deal that is valued (cash transaction) at $14.3 billion (£11bn). As a result they will go from being a public to a private company.
Apparently Zayo’s existing team will continue to execute the Company’s strategy and their HQ will remain in Boulder, Colorado (USA). As usual the deal still has to jump through all the usual regulatory hurdles, but assuming all goes well then it’s hoped that the transaction will complete during the first half of 2020 (calendar).
One particularly interesting detail about this development is that at the end of 2018 Digital Colony separately acquired another company called OpenCell, which is based in the UK and focused upon the development of Small Cell infrastructure for all four primary mobile network operators (they currently have about 2,000 live cells across 100 networks).
The fact that future 5G mobile networks will be very dependent upon high capacity fibre optic lines to support their ambition for multi-Gigabit mobile broadband speeds is perhaps something that Zayo’s new owner may be very keen to exploit, albeit more so in dense urban areas where they already have a significant presence (e.g. London, Glasgow, Manchester, Birmingham, Bristol, Leeds and Edinburgh).
Dan Caruso, Zayo’s Chairman and CEO, said:
“Digital Colony and EQT share our vision that Zayo’s Fiber Fuels Global Innovation. Both are experienced global investors in the communications infrastructure space, and they appreciate our extraordinary fiber infrastructure assets, our highly talented team and our strong customer base. I am confident this partnership with EQT and Digital Colony will empower Zayo to accelerate its growth and strengthen its industry leadership.”
Marc Ganzi, Managing Partner of Digital Colony, said:
“Zayo has a world-class digital infrastructure portfolio, including a highly-dense fiber network in some of the world’s most important metro markets. We believe the company has a unique opportunity to meet the growing demand for data associated with the connectivity and backhaul requirements of a range of customers. We are excited to work alongside the management team and EQT to grow the business and expand its presence in the global market.”