Zayo’s buyers to offer $3B in debt to finance impending takeover

BOULDER — The consortium of private buyers for Zayo Group Holdings Inc. (NYSE: ZAYO) will begin raising $3 billion in debt as part of the $14.3 billion buyout, just two months before the deal is expected to close.

The two buyers, Swedish private equity firm EQT AB and Florida investment firm Digital Colony LLC, are offering $1 billion in secured debt and $2.08 billion in unsecured debt through a subsidiary specifically created for the deal that would take Zayo off the New York Stock Exchange if closed.

Interest rates for the debt notes were not specified.

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Zayo said in its earnings report last week that it expects to close the go-private sale by the late first quarter or early second quarter of this year. That would give its buyers approximately two months to raise the funds and close the deal in the most recent timeframe.

The Boulder-based Zayo builds and operates bandwidth infrastructure for telecom providers. It has approximately 3,700 employees, with 1,100 in Boulder.

The Federal Communications Commission signed off on the sale last week after federal regulators determined a foreign company taking a controlling stake in the company didn’t amount to a national security threat.