Zayo Group to purchase 360networks
By Joan Engebretson, Connected Planet
Oct 7, 2011 3:36 PM,
Acquisition, the consolidator’s biggest to date, will nearly double its network assets
Zayo Group, a wholesale fiber network operator that has been particularly aggressive in acquiring other carriers, announced today that it has signed an agreement to purchase 360networks, a wholesaler that operates fiber networks throughout Tier 2 and Tier 3 markets in the western United States.
The companies did not disclose the purchase price, but Zayo said the acquisition is the largest of the 17 it has made since 2007. Zayo said the acquisition will nearly double its network infrastructure and allow the company to provide a greater range of solutions, both in terms of markets served and the ability to interconnect services across markets.
360networks operates more than 18,5000 route miles of intercity and metro fiber networks across 22 primarily western states and British Columbia.
Zayo is a privately held company backed by M/C Venture Partners. In an interview with Connected Planet late last year (CP: A VC view of buying and selling telecom providers), M/C Venture Partners General Partner Gillis Cashman said demand for fiber has increased substantially in the last couple of years, but the available supply of fiber has not kept pace.
Cashman added that the greatest demand for fiber is at the network edge, driven in large part by mobile backhaul demand. “Carriers with core backbone networks are well positioned to address the edge,” Cashman said.
Zayo’s strategy has been to buy up other fiber operators who sometimes have been cash-starved, with the goal of meeting the increased fiber demand. The company also has done some judicious build-outs of its own, including some funded through the broadband stimulus program (CP: Announcing the broadband stimulus round 2 winners). 360networks calls itself a ‘wholesale telecommunications provider of private line transport, carrier Ethernet, IP transit, VoIP and local access (T1/DS3) services.’
One of the company’s more unique offerings is a virtual peering service based on cross-connects that leverages the company’s co-location in numerous carrier hotels throughout its footprint (CP: 360 Networks launches remote peering service for wholesale customers).