XO Communications stepped back into the public eye with some new expansion plans yesterday, backed by some new cash. Since Chris Ancell took over as CEO after last Thanksgiving, I’ve been waiting to see which way he would turn the steering wheel at XO.
XO has recently completed some $500M in financing. Some portion of that will be going toward ‘robust investments’ in their national network footprint over the next few years. Beyond that, there aren’t a lot of specifics yet.
Whether the $500M funding came from Icahn or one of his various affiliated companies or funds, the debt markets, or elsewhere was not mentioned. Does anyone out there know?
As for where in the network they will be spending it, no specifics were given. An expansion can manifest in several ways: building out new markets, building additional network depth in existing markets, installing new/upgraded equipment with more advanced capabilities on existing routes, and developing new products.
XO’s network projects during the Icahn decade have generally been focused on the latter two, especially while lighting their intercity dark fiber and entering the wholesale business a few years back. Their network footprint itself hasn’t changed all that much over the years as compared to their peers. Personally, I have always thought their metro footprint should get more attention than it has, but that does require the willingness to invest significant capex.
It has been over two and a half years now since Icahn took the company private, which has been followed by several rounds of internal reorganization. I’m curious to see where Ancell will be putting his focus now that the reins are his. Hopefully the company will tell us more in the coming quarters.
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