Zayo anticipates significant revenue and more than $40 million in annual savings from the acquisition of Electric Lightwave, previously known as Integra Telecom, which provides infrastructure and telecom services primarily in Western US and has 8,100 route miles of long haul fibre and 4,000 miles of dense metro fibre in Portland, Seattle, Sacramento, San Francisco, San Jose, Salt Lake City, Spokane and Boise.
“Electric Lightwave provides us another unique and dense regional fibre network that advances our position as the only national independent infrastructure provider remaining in the US,” said Dan Caruso, chairman and CEO, Zayo. “Electric Lightwave has both strong metro fibre assets in key West Coast markets and capacity and routes that will augment Zayo’s intercity footprint.”
This is just the latest merger to surface in the industry, which recently saw CenturyLink and Level 3 merge in a $34 billion deal and US carriers Windstream and EarthLink are to merge in an all-stock deal valued at £1.1 billion.
“Approximately 40% of Electric Lightwave’s existing revenue aligns with Zayo’s infrastructure-focused business segments and will be rapidly integrated into the core Zayo organisation, processes and systems,” a Zayo statement said. The remainder, which is a valuable and viable cash-flow generating business, has a customer base that aligns well with Zayo’s Canadian SME and voice businesses.”
Zayo’s Caruso added: “Zayo has a proven track record of integrating key fibre infrastructure assets while also maximizing the value of more traditional telecom business units.”
Zayo expects to achieve significant revenue and cost synergies over the coming quarters, driven by the efficiencies of scale and achieved via Zayo’s proven, streamlined integration process. Zayo’s Tranzact platform and Salesforce.com implementation will provide seamless online access to viewing, purchasing and managing the combined customers and network.
Zayo expects to close the deal Q1 2017, subject to customary regulatory approvals and closing conditions.
