A bunch of fiber has changed hands in the Midwest this week. In a pre-Christmas deal, Windstream has sold ‘certain fiber assets’ to Minnesota-based Arvig Enterprises, Inc.
The purchase cost Arvig some $60.5M. The bulk of that, $49.5M, went toward Windstream’s extra dark fiber in Minnesota, while the other $11M bought some more in Nebraska. Windstream has ILEC footprints in both states, but also acquired some fiber assets that derive from McLeodUSA back when it bought PAETEC. My guess is most of the fiber changing hands today has origins with McLeodUSA, but I could be wrong.
Arvig mostly flies below the national radar, but has made a few deals over the years to boost its regional presence (see pic). In May of this year they bought Palmer Wireless, and in 2015 they acquired North Star Fiber. When complete sometime next quarter, Arvig’s fiber network will span some 10,000 route miles. Minnesota is Arvig’s home turf, and the deal will add depth to their regional and metro footprint there. What they have planned for the assets in Nebraska I’m not sure.
For its part, Windstream isn’t leaving Nebraska or Minnesota entirely. Rather what they are doing is selling off the dark fiber infrastructure that they don’t need in order to focus in the company’s lit services, and will be leasing back some of that fiber from Arvig to serve those needs. Windstream has been investing its it network footprint via dark fiber leases, including new routes all the way out to the west coast.
According to the announcement, Windstream may be gearing up to sell other excess dark fiber assets around its footprint.
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