Comcast's biz unit deals for Nitel

Comcast Business dipped into the M&A pool again, announcing today that it has inked a deal to acquire Nitel from Cinven, a private equity firm.

Terms of the deal were not disclosed. Cinven, which originally invested in Nitel in November 2021, said it will sell its stake in the Chicago-based company.

Comcast said the deal will help it expand its portfolio of managed services, including new options for midsized and enterprise customers.

Nitel is billed as a network-as-a-service (NaaS) provider spanning areas such as networking, cloud services and cybersecurity. It claims to have 6,600 customers in the US, including in markets such as financial services, retail, healthcare and education.

Nitel is led by Margi Shaw, the former CEO of First Communications and an exec late of Cimco, a Chicago-based CLEC (competitive local exchange carrier) that Comcast acquired in 2009. That deal signaled the cable operator's decision to start its move up market to serve large and midsized business customers.

Nitel's expansion

Nitel has also been acquiring assets. In March, it snapped up WAN Dynamics, a Cleveland-based SD-WAN company, after buying Hypercore Networks in June 2022.

Nitel has also been expanding into different types of access platforms. In January, the company announced the launch of low-Earth orbit (LEO) satellite service access to expand its international reach and cover rural areas, but it did not reveal its partner. Notably, Comcast Business recently notched a deal with Starlink to help it serve customers in areas unserved or underserved by wireline broadband.

Related:Comcast Business acquires Masergy at 'opportune time,' say industry analysts

In June, Nitel announced an integration agreement with network security/SD-WAN specialist Fortinet.

Comcast said its deal with Nitel, which is in the process of securing regulatory approvals, will help its business services unit enable customers to manage their operations and networks more security and efficiently.

"Nitel is a dynamic player in managed network services, and its addition to our portfolio will strengthen our capabilities in advanced network, cloud and cybersecurity solutions," Comcast Business President Edward Zimmermann said in a statement.

Getting bizzy with M&A

Nitel joins a string of acquisitions made by Comcast Business in recent years.

Comcast Business acquired Masergy in 2021, a move that gave Comcast a large list of customers and SD-WAN technology, and one that also helped the company put more focus on midsized and enterprise-level customers. Jim Glackin, who currently runs Nitel's channel sales, served in a similar role at Masergy.

Related:Comcast Snares a CLEC

Other Comcast Business acquisitions include Blueface (2020), Deep Blue (2019), Defined Technologies (2021) and New Global Telecom (2010).

Business services remain a key growth engine for Comcast, though the rate of growth has slowed as the unit has scaled up its base of customers and revenue base. Comcast pulled in $2.45 billion in US commercial revenues in Q3 2024, up from $2.32 billion in the year-ago period.

Speaking at this week's UBS Global Media & Communications Conference, Comcast Cable CEO David Watson said the operator views business services as a $60 billion addressable marketplace.