Zayo strikes deal to acquire American Fiber Systems
Zayo is once again coming to the deal table with a bid to acquire Rochester, N.Y.-based American Fiber Systems Holding Corporation (AFS), a provider of metro fiber and telecom services. By purchasing AFS--Zayo's fifteenth acquisition since its inception in 2007--the service provider will augment and expand its fiber network presence in nine Tier 1 and Tier 2 metro U.S. markets.
Out of the deal, Zayo will add another 800-plus miles of fiber route miles in six new metro markets, including Boise, Kansas City, Las Vegas, Nashville, Reno and Salt Lake City. What's more, Zayo gets 400 additional route miles in not only Atlanta (a new market Zayo will enter through its pending acquisition of AGL Networks), Cleveland and Minneapolis.
While much M&A attention for the past year has been mainly centered around Tier 2 ILEC deals--namely CenturyLink's (NYSE: CTL) acquisition of the former EMBARQ and now Qwest (NYSE: Q) and Frontier's acquisition of Verizon's rural lines--Zayo's ongoing moves appear to be signaling a new consolidation trend of the regional fiber provider market.
Of course, Zayo is not the only one making deals. In addition to Zayo's purchase of AFS and AGL earlier this year, new rumors have emerged that at least four other fiber operators (Alpheus, KDL, Fibertech and now FiberNet)--are looking for potential bidders to buy their respective fiber network assets.
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