The FCC approves Zayo buyout

The FCC approves Zayo buyout

07 February 2020 | Natalie Bannerman

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The Federal Communications Commission (FCC) has approved Zayo Group's buyout by Digital Colony and EQT Partners.

In a public notice, the FCC granted a application for the transfer of control of the Zayo Group, Electric Lightwave and Allstream Business to FrontRange TopCo.

In the notice it said:

“We find, upon consideration of the record, that the proposed transfers will serve the public interest, convenience, and necessity. The proposed transfers present no significant competitive harms and should likely result in some public interest benefits related to network investment and the increased ability of the combined company to serve customers on its own facilities.”

The $14.3 billion acquisition of Zayo by Marc Ganzi’s Digital Colony and EQT Infrastructure IV fund is due to complete over the coming months. Once finalised, Zayo will transition from a public company to a private company, while its team continues to lead the company forward based in Boulder, Colorado.

Under the terms of the agreement, Zayo’s shareholders will receive $35 in cash per share of common stock in a transaction valued at $14.5 billion. Additionally, the deal represents a 32% premium to the volume-weighted price average of the last six months of $26.44.

In October 2019, Colony Capital, sold two of its real estate operations in advance of its Zayo acquisition, raising $7.5 billion. It sold its industrial warehouses to Blackstone group for $5.9 billion and sold NorthStar Realty Europe to AXA Investment Managers.

Colony Capital and Digital Bridge Holdings are to merge with Ganzi becoming CEO of both. The deal has been done by Colony Capital buying up Digital Bridge for $325 million.

In related news, Digital Colony unified three of its UK operations under a new brand, Freshwave. The three companies, StrattoOpencell, iWireless Solutions and Spyder Facilities that were acquired between August 2018 and June 2019, all specialise in providing indoor and outdoor mobile networks on behalf of licensed operators.