Mergers & acquisitions

Zayo to Buy AllStream for $348M

Zayo plans to expand its fiber presence in Canada by buying AllStream from MTS for $348 million in cash.

The company revealed the deal on Monday morning. Zayo Group Inc. (NYSE: ZAYO) will pay 465 million Canadian dollars ($348 million) for Allstream Corp. , which is a subsidiary of MTS.

The point of the buyout is to give Zayo a presence in the major cities in Canada and links into the US market. Allstream has over 5,992 route miles of metro fiber network concentrated in Toronto, Montreal, Vancouver, Ottawa and Calgary that connect to around 3,300 buildings. The unit has a long-haul fiber network connecting all major Canadian markets and ten US network access points. In addition, Allstream operates co-location space in Toronto, Montreal and Vancouver.

The deal is expected to close in the first quarter of 2016. AllStream will become Zayo Canada.

The buyout continues Zayo Group Inc. (NYSE: ZAYO)'s acquisition spree in 2015. The Boulder, Colorado-based group has this year closed a $675 million takeover of Latisys Holdings and a $52 million acquisition of IdeaTek and recently agreed to pay €95 million ($101 million) for Ireland-based Viatel.

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— Dan Jones, Mobile Editor, Light Reading

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