Lightower, Fibertech Merge in $1.9B Cash Deal
Fiber optic network providers Lightower Fiber Networks and Fibertech Networks are merging in an all-cash deal valued at $1.9 billion, the two companies announced Monday. (See Lightower, Fibertech to Merge.)
The merger will create a single larger network company providing wholesale fiber optic and dark fiber services in the highly populated Northeast, Mid-Atlantic and Midwest regions of the US.
The deal is the latest network expansion by Lightower Fiber Networks , which has been aggressively increasing its footprint through both organic expansion and acquisitions such as its $2 billion purchase of Sidera Networks. The Fibertech Networks LLC deal gives the company both a denser footprint and greater reach into the central part of the US, where Fibertech operates networks throughout Ohio and in places such as Detroit and Indianapolis. (See Lightower Expands Its Fiber Network and Lightower, Sidera Merge in $2B Deal.)
Both the fiber optic services and dark fiber options are increasingly in demand for a variety of applications including mobile backhaul, data center interconnection and content distribution networks as more web content companies build out their own facilities. The combination of Lightower and Fibertech will have 30,000 route miles of fiber in the Northeast, Mid-Atlantic and Midwest US, with access to 5,000 wireless towers and 13,000 on-net facilities including data centers, financial exchanges, content hubs, colocation sites and commercial buildings.
The merger is being funded through a combination of equity and debt and backed by Lightower's current backers including Berkshire Partners, Pamlico Capital and ABRY Partners.
Lightower's CEO Rob Shanahan, who will lead the newly merged company, said in a statement that the two companies' networks are largely complementary, without substantial overlap, and will continue to grow.
"The combination of Lightower and Fibertech is a win for customers by enabling us to serve more locations, across a wider area, and with more service options -- all with the same superior level of reliability and customer support," he said. "Lightower and Fibertech have built distinct networks in their respective regions that will be very complementary when merged. In addition, we plan to continue to invest capital in these regions for additional network expansion."
— Carol Wilson, Editor-at-Large, Light Reading