CBTS, Cincinnati Bell’s business services subsidiary, has acquired regional provider SunTel Services, advancing its out-of-territory presence and unified communications (UC) capabilities.
After completing the acquisition, SunTel co-founders Gary Jackson and Don Jackson will continue to lead the company and will also spearhead CBTS’ expansion in the Michigan market.
Stephens Inc. is serving as the exclusive financial adviser to CBTS, and Quarton International is serving as the exclusive financial adviser to SunTel Services.
The acquisition is not subject to regulatory approval and is expected to close in the next 30 days.
Midwest expansion focus
Purchasing SunTel makes sense for CBTS, particularly as it allows the company to immediately scale its Midwest business presence.
This acquisition builds on CBTS’ existing sales offices in Cleveland, Columbus, Indianapolis and Louisville, Kentucky.
“We believe CBTS’ set of solutions and services will benefit SunTel Services’ existing customer base, and SunTel will help grow our footprint throughout the Midwest,” said Scott Seger, SVP and general manager for CBTS, in a release.
While Cincinnati Bell has not ruled out extending its presence in other markets, the initial focus of the service provider’s out-of-territory expansion will focus on the Midwest states where it has nearby presence to its home market in Cincinnati.
Acquiring SunTel is in line with Cincinnati Bell’s broader strategy to advance and grow the CBTS division. Cincinnati Bell has cited purchasing other service providers that offer unified communications as a service (UCaaS) and network as a service (NaaS) as key areas of interest.
Leigh Fox, president and COO of Cincinnati Bell, told investors during its fourth-quarter earnings call that “we are looking at growing the Midwest presence and then looking at relationships.”
At the same time, the service provider continues to enhance its enterprise service portfolio. A key area of focus is enhancing the NaaS product set. Earlier this month, Cincinnati Bell introduced its new NaaS offering, a fully managed solution that bundles integrated SD-WAN capabilities to connect multiple remote business locations.
Cincinnati Bell’s NaaS service will bundle various functions, including cloud integration, security, switching, Wi-Fi, management, monitoring and SD-WAN. Customers pay a single, predictable monthly price for equipment and support.
Since SD-WAN can leverage any type of broadband connection from Cincinnati Bell or another provider, the service provider could immediately extend its service footprint to accommodate more of its growing multisite business customer base.
Cincinnati Bell can use SD-WAN as a competitive tool to effectively eat into other service providers’ MPLS market share.