COMPTEL PLUS Lightower Fiber Networks on Tuesday made good on rumors swirling at COMPTEL PLUS Fall 2010 and said it is buying Lexent Metro Connect, marking the second fiber-centric acquisition announced in as many days on Monday, New York-based CLEC PAETEC revealed its $460 million purchase of Cavalier Telephone Corp.
Lightower specializes in fiber broadband services while Lexent focuses on dark fiber connectivity among carrier hotels, central offices and enterprise buildings.
Lightower gains more than 150 route miles throughout New York and New Jersey, as well as access to more than 200 commercial buildings, thanks to the Lexent takeover. Lightower already owns 4,600 fiber-route miles throughout Connecticut, Massachusetts, New Hampshire, New Jersey, New York and Rhode Island. Privately held Lightower and Lexent did not disclose the terms of the transaction, which should close in the fourth quarter.
Discussing the deals rationale, executives pointed to the increasing demand” for fiber connectivity in the greater New York City area and perhaps increasing demand” marks an understatement. At one COMPTEL session on Monday, panelist John Scarano, COO of Zayo Group and president of Zayo Bandwidth, said the insatiable use of [mobile] devices” alone is eating capacity that, fulfilled three years ago by three or four T1s, now requires 20-25 megs.
We see this trend continuing,” Scarano said.
And while Lightower focuses on the financial and media vertical markets, rather than wireless backhaul, bandwidth consumption still is spiraling. All fiber operators are juggling higher usage, whether from consumers on wireless devices or businesses needing ultra-fast, low-latency broadband connections. This uptick in consumption is spurring fiber carriers to join forces for operational strength and coverage density. Some key transactions include PAETEC-Cavalier, Windstream-KDL-Norlight, Zayo-American Fiber Systems, nTelos-FiberNet and a number of others.
For Lightower and Lexent, then, the combination creates a natural fit,” said Rob Shanahan, Lightower president and CEO, in a prepared statement. To wit, Lexent customers will be able to buy Lightowers managed services including Ethernet, SONET and colocation. Lightower clients will have access to more fiber in New York and New Jersey.
Of note, private equity firm M/C Venture Partners features prominently in this latest round of M&A. M/C Venture Partners backs fiber companies including Zayo and invested in Cavalier, the company combining with PAETEC. A year ago, M/C Venture Partners Gillis Cashman said fiber providers would usher in the telecom industrys next wave of M&A and usher it in they have. Operators know they need to build into demand, not in front of demand,” Cashman said last year. The fiber space has held up well,” he added.
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September 24 2018 @ 18:15:10 UTC