Zayo Group acquires fiber company for $127 million in cash

BOULDER — Zayo Group Inc. (NYSE: ZAYO) has entered into an agreement to acquire Spread Networks for $127 million in cash.

Spread Networks is a privately-owned telecommunications provider that owns and operates 825 miles of fiber optic cable between New York and Chicago.

The acquisition will provide Zayo customers with the lowest latency and directly connect the two cities, especially beneficial for financial services customers who need the two major financial markets. The fiber route will also combine with Zayo’s existing routes that connect Seattle and San Francisco to Chicago.

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The high-fiber count route serves about 60 customers already with capacity for many more. Of the 432 fibers along the route, less than 25 percent are utilized.

“Spread constructed this route to provide the fastest possible speed on the shortest possible route,” Jack Waters, CTO and president of Fiber Solutions at Zayo, said in a prepared statement. “This asset is an outstanding complement to our existing network, providing customers with low-latency options to and from the country’s leading centers of finance and commerce. Given the relative simplicity of the business, this will be a straightforward integration with meaningful, near-term synergies.”

The transaction will be done in all-cash using cash on hand and debt. The deal is expected to close in the first quarter of 2018.