You knew it had been too quiet over at Zayo, I’m not sure they’ve ever gone a year without an acquisition. And so it came as little surprise today when Zayo announced the purchase of western regional operator 360Networks. In fact, the combination is one I mentioned as strategically interesting a few times in the past. Here are the two network maps side by side:
The 18,000 mile intercity fiber network of 360Networks will act to hook up most of Zayo’s more disconnected fiber assets across the western US. In fact, what this does is give Zayo a truly transcontinental presence, connecting to their eastern longhaul network at Chicago. Much of this fiber derives from the former Touch America buildout, and is rather unique. There is also dark fiber that 360Networks hasn’t lit yet connecting both Chicago and Dallas to New Orleans which I think Zayo will surely invest in lighting.
Additionally, 360Networks brings 800 miles of metro fiber of its own to the combination, which will add to Zayo’s coverage as well – giving the company a starter set in some new markets. Earlier this year, 360Networks did a deal with Zayo to leverage its metro dark fiber – so the two networks are already closely aligned.
All in all, this deal has always made sense for the strategic fit overall, and while there will be synergies I doubt very much if there will be substantial layoffs as a result. 360Networks also has a wholesale VoIP business, which will will be spun off by Zayo into Onvoy as in the past. Financial terms of the deal were not disclosed.