Two of the country's youngest and most dynamic metro fiber builders and operators have decided to join forces. ZenFi and Cross River Fiber have long been following similar paths in adjacent territories, and the combination has always been one that makes sense even if it seemed more likely that each would eventually be bought by one of the larger industry consolidators eventually.
Cross River Fiber's footprint spans much of northern NJ now. They started out specializing in low latency connections between the key financial spots in the state, but soon expanded out into the suburbs and the broader enterprise market. ZenFi decided to rethink the metro fiber business in the five boroughs of NYC, building out both backhaul and fronthaul to meet the needs of 5G better. Combined the company's footprints will span 700 route miles, 130 on-net buildings, 49 colo facilities, and 1700 wireless locations with another 3000 planned.
Both companies are led by CEOs who helped lead an earlier generation of metro fiber operators prior to consolidation. ZenFi's Ray La Chance sold Lexent Metro Connect to Lightower, while CRF's Vincenzo Clemente was VP of Operations at 4Connections before it was bought by LightPath. Both took those experiences and dove right back in, applying to the problem the local knowledge that is often lacked by the national operators in one of the biggest global markets.
The integration should be a snap, really, since there isn't any legacy infrastructure, the two companies are already operationally familiar with one another, and the overlap is minimal and already interconnected anyway. The current management teams will continue to lead the company, although the details of how that will actually happen aren't yet public.
ZenFi was largely self-funded, while Cross River Fiber was backed by Ridgemont Equity Partners. Ridgemont is making the deal happen and will be staying on, but the details of ownership stakes were not given. I'd have to guess ZenFi's backers are still in the picture though. Bank Street Group advised both sides, while Webster and CoBank will be providing debt financing for the merger and future growth needs. The merger is expected to close later this year.