Canadian cable operator Cogeco, which has established a large U.S. East Coast presence via its ownership of Atlantic Broadband, has acquired pieces of FiberLight’s dark fiber network in Florida.
The Canadian operator confirmed its move in its recently issued shareholders report (PDF). On Dec. 30, Cogeco said that Atlantic Broadband acquired several dark fibers throughout South Florida for $16.8 million.
During the same day, Atlantic Broadband also signed an Asset Purchase Agreement to acquire FiberLight’s fiber network and corresponding assets located on the east coast of south Florida for $34 million. Before it closes, the second dark fiber deal needs to meet regulatory approvals and customary closing adjustments.
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By making this deal, Cogeco and Atlantic Broadband will get access to additional metro and regional fiber along the southeastern coast of Florida. FiberLight's footprint in southeastern Florida goes from West Palm Beach down through Miami, passing through Fort Lauderdale and Boca Raton. This network represents one of the company's five main regional footprints.
FierceTelecom could not reach FiberLight or Atlantic Broadband for a comment about the sale.
Rob Powell, founder and chief editor of Telecom Ramblings, said in a post that the Florida sale could raise questions if FiberLight is considering a broader effort to sell off more of its network assets in other parts of the country.
“Now the question becomes, will FiberLight be selling off any or all of the other four distinct pieces, i.e. their western Florida networks, their Atlanta metro footprint, their DC area metro footprint, or the huge Texas statewide network,” Powell said. “It's that last one that would be fought over the most, as it is the most unique and would fit so nicely into the asset bases of both Zayo and Crown Castle, among others.”
Overall, FiberLight currently owns and maintains 1.7 million fiber miles in over 400 cities and towns across the United States. It also maintains over 17,000 backbone access points, 1,700 on-net locations and presence in over 100 data centers across the country.
FiberLight told FierceTelecom that along with increasing its on-net fiber footprint to serve more business customers, the service provider sees opportunities to serve international carriers that are coming into submarine cable landing stations and data centers. The service provider has already extended its fiber into Miami’s subsea landing stations where large international carriers come into the United States, and the company would also like to pursue opportunities in the Northeast, for example.
For its part, Atlantic Broadband could use the dark fiber assets for two purposes: enhancing fiber-based business services and supporting its ongoing DOCSIS 3.1 rollout to consumers and small business customers. The service provider currently offers a 10 Gbps Ethernet service to business customers across its service areas in western Pennsylvania, Miami Beach, Maryland, Delaware and South Carolina.
Regardless of what FiberLight or Atlantic Broadband’s parent's next move may be, this deal illustrates the growing value in dark fiber assets. Service providers like Atlantic Broadband likely found that instead of leasing the assets from FiberLight, a purchase was a better fit.