The top wireline mergers & acquisitions in 2012
Welcome to our fourth annual M&A roundup. As seen in previous years, 2012's narrative was once again about the continuing consolidation of the vendor and service provider markets.
Consolidation in the wireline industry took place on three main fronts:
Vendors: Two of the telecom industry's largest vendors—Cisco (Nasdaq: CSCO) and Ericsson (Nasdaq: ERIC)—made sizeable deals in 2012. Similar to fellow European vendor Nokia Siemens Networks, Ericsson also decided that it wanted to focus on Calix (NYSE: CALX). Cisco, meanwhile, continued on its acquisition streak, purchasing Cariden, a software vendor that makes network planning, design and traffic management solutions focused on service providers.
Service provider consolidation: Once again, consolidation of the service provider was in full swing during the year, as both traditional telcos and competitive players acquired regional and large players to complement their own service and network mix. Two of the biggest deals to take place in 2012 were Consolidated Communications (Nasdaq: CNSL) purchasing fellow independent ILEC SureWest and Zayo acquiring AboveNet—its largest deal to date. A number of other smaller telcos, including Hawaiian Telcom (Nasdaq: HCOM), HickoryTech (Nasdaq: HTCO), Ritter, and TDS Telecom (NYSE: TDS), also made headlines for their deals of other companies that enhanced their portfolios.
Private Equity: Seeing value in the telecom space, venture capitalists took an active role in purchasing telecom companies during the year. Two of the notable deals came late in the year from Marlin Capital and Berkshire Partners. Nokia Siemens Networks took another towards its mobile-centric dream by selling its optical networking business to Marlin Capital for an undisclosed sum. No less compelling was Berkshire Partners' move to acquire both Lightower Fiber Networks and Sidera Networks for $2 billion and merge them into an even larger competitive provider.
In keeping with the tradition we established with this feature, each of the deals outlined are ranked by the dollar amount (if disclosed). You can click here to get access to a chart that outlines all of the deals.