Zayo Flexes Euro Muscles, Wins Expanded TalkTalk Deal

June 12th, 2014 by · 1 Comment

Zayo has picked up a significant contract expansion with the UK's TalkTalk. Zayo will be providing 10G waves in the UK and across Europe, a boost of IP transit speeds to 50G, and 10G transatlantic circuits, as well as seven new dark fiber circuits for satisfying future demand.

The TalkTalk contract expansion follows Zayo's first two European M&A moves over the past two months, buying Geo Networks in the UK and agreeing to purchase Neo in France (although the close is still a while off yet). Geo is the sort of asset they have a lot of experience integrating of course, but on a different continent and with some different corporate DNA to assimilate.  However, it's a very positive sign that already they seem to be tapping the combined reach of Geo and the former AboveNet UK assets.

So where to next for Zayo in Europe? (Several have asked me to speculate.) As in their US roll-up, the territories do not necessarily have to be contiguous.  But in this case, it's probably the easier route.  One obvious target that is frequently mentioned would be euNetworks to move into the Netherlands and Germany in force while further gaining scale in the UK and France. But I think there are other options too.  For instance, they could take a look at Digiweb's Viatel business to expand further in Ireland and France or IP-Only for a Nordic foothold that seems very complementary. Or they could even go big and bid for someone like Interoute.  Zayo has always been very opportunistic, so it depends entirely on who is most willing to talk.

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Categories: Mergers and Acquisitions · Metro fiber

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