Tony Tomae, Birch Communications’ CEO, is leaving the company as Fusion gets ready to complete its acquisition of the competitive provider.
Matthew Rosen, Fusion's current CEO, will be the CEO of the combined company following the deal’s close. The service provider has not named other top management team members yet.
In August, Fusion signed a deal with Birch Communications Holdings, Birch's parent company, to acquire its cloud and business services customers, operations and infrastructure.
Tomae, a 25-year plus telecom industry veteran, came to Birch in 2016 from FairPoint Communications. At FairPoint, which is now part of Consolidated Communications, he served as chief revenue officer and oversaw sales, marketing, and product management functions. He left FairPoint as part of a companywide restructuring effort.
"During Mr. Tomae's tenure, Birch has recognized significant improvement in several key financial and operational metrics of our business, including sales and cost of sales, SG&A, EBITDA and free cash flow,” said R. Kirby Godsey, Birch's chairman of the board, in a release.
While Fusion is no stranger to M&A, this deal is significant in terms of the assets it brings to the table. The service provider acquired business communications provider Apptix in 2016 for $28 million, for example.
Upon completing the acquisition, Fusion will become one of the largest North American cloud providers, with over 150,000 business customers 30 data centers and 31,000 miles of fiber. The purchase will make Fusion a competitive threat to large telcos such as AT&T and Verizon and cable operators like Charter and Comcast, which have been expanding their presence in the medium and large business segments.
Being purchased by Fusion allows Birch to further expand its presence in the cloud services space. After reemerging from two bankruptcies, the service provider had embarked upon an aggressive acquisition campaign starting in 2003 to build out the size of the company's IP network. In all, the service provider has purchased over 24 other service providers, including Cbeyond and Primus.
By acquiring Cbeyond for $323 million in 2014, Birch expanded its services to small- and medium-size businesses. At the same time, the service provider continued to enhance its metro fiber network.