Cox Communications inked a deal to buy the commercial services segment of Segra, a privately-held fiber infrastructure provider based out of Charlotte, North Carolina. Terms of the deal were not disclosed, but Bloomberg sources estimate the deal at about $3 billion. Cox is buying the business segment from the investment company EQT Infrastructure.
The commercial services segment provides fiber to enterprise and carrier customers in nine states in the Mid-Atlantic and Southeast U.S. Segra has a dense metropolitan fiber network in its footprint.
“Cox is focused on buying and investing where it makes sense, and we believe that the demand for broadband infrastructure will continue to grow, making fiber an attractive area for long-term investment,” said Cox CEO Pat Esser, in a statement.
Segra’s existing management team will continue to lead the Segra enterprise and carrier organization following the acquisition. It will retain the Segra brand and operate as a stand-alone business within the Cox family of companies.
“Our relationship with Cox will allow Segra to leverage expert resources, capabilities and strategic insights in order to scale up operations and accelerate long-term growth,” said Timothy Biltz, CEO of Segra, in a statement.
One of Segra’s carrier customers is Dish Network. In November 2020, Dish announced fiber agreements with four companies: Everstream, Uniti, Zayo and Segra.
Those four fiber partnerships will provide fronthaul and backhaul support for Dish's 5G network to sites covering approximately 60 million U.S. citizens.
Segra’s residential and SMB business
Segra’s residential and small-to-medium sized business (SMB) segment operates under the Lumos Networks and NorthState brands. As part of the announced sale of Segra’s commercial business to Cox, EQT Infrastructure will retain ownership of the Lumos Networks and NorthState operations and support it as a stand-alone company.
That portion of the company operates primarily in Virginia and North Carolina where it provides broadband, mostly via fiber, to nearly 200,000 residential and SMB locations.
EQT plans to expand broadband services to neighborhoods and markets throughout its region. Diego Anderson, general manager of the residential and SMB operations, will serve as CEO of the new company.
Fiber is hot
For a number of years fiber has been regarded as too expensive to deploy in most places. But the Covid-19 pandemic is causing a renewed interest in the connectivity. Both Verizon and AT&T touted their fiber strategies in their most recent earnings calls.
Yesterday, AT&T announced that it’s giving its fiber customers a free bump in speeds.
The company is boosting its 100 Mbps customers to 300 Mbps, and it’s bumping its 300 Mbps customers to 500 Mbps. It will still offer its 1 gig plan as well, and these customers get HBO Max included.