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Windstream Spinoff CS&L to Buy PEG Bandwidth In $400 Million Deal

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**Editor’s Note: Please click here for a recap of the biggest channel-impacting mergers in Sept.-Oct. 2015.**

Communications Sales & Leasing (CS&L), a real estate investment trust (REIT) and Windstream spinoff, announced Friday it is buying competitive fiber provider PEG Bandwidth.

PEG’s fiber network spans more than 300,000 strand miles in the Northeast/Mid Atlantic, Illinois and South Central regions of the United States. PEG is owned by affiliates of Associated Partners, an investment and operating partnership.

CS&L currently owns 3.5 million fiber strand miles, 235,000 route miles of copper and other property across 29 states.{ad}

The purchase price for all outstanding equity interests of PEG is valued at $409 million. The deal, which will be funded through a combination of cash and stock, is expected to close in April.

“PEG Bandwidth is a compelling and strategic acquisition for CS&L with a rich fiber-to-the-tower network, respected management team, and strong customer relationships with over 80 percent of revenues from the largest wireless carriers,” said Kenny Gunderman, CS&L’s president and CEO. “PEG will provide us a high-growth operating platform as we continue to build a fiber rich REIT focused on acquiring and constructing mission critical communication infrastructure assets.”

Last April, Windstream completed its tax-free spinoff of telecommunications network assets into CS&L. At the time, Windstream CEO Tony Thomas said the spinoff “made Windstream a stronger company with less debt and increased capacity to invest in our network to provide advanced communication services to customers.”

“CS&L is a great partner as PEG continues to grow and diversify its business, and we are thrilled to have a continuing equity interest in CS&L given our assessment of their future prospects,” said Scott Bruce, Associated Partners’ managing director. Following the closing of this transaction, he is expected to join CS&L’s board of directors.


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