Zayo to be Acquired for $14.3B
Zayo Group Holdings, Inc. has announced the signing of a definitive merger agreement for its acquisition by affiliates of Digital Colony Partners (“Digital Colony”) and the EQT Infrastructure IV fund at a total of $14.3 billion.
Zayo is a provider of communications infrastructure services, including fiber and bandwidth connectivity, colocation and cloud services. This transaction would result in Zayo transitioning from a public company to a private one, as the buyers (Digital Colony and EQT) will pay $35 per share in cash to all shareholders of Zayo’s common stock.
Unanimously approved by Zayo’s Board of Directors, the buyers will also assume Zayo’s net debt obligations of $5.9 billion. Adding this debt to the company’s equity, resulted in a transaction valued at $14.3 billion. The offer price represents a 32% premium to the volume-weighted price average of the last six months of $26.44 as reported by the company.
“Digital Colony and EQT share our vision that Zayo’s Fiber Fuels Global Innovation. Both are experienced global investors in the communications infrastructure space, and they appreciate our extraordinary fiber infrastructure assets, our highly talented team and our strong customer base. I am confident this partnership with EQT and Digital Colony will empower Zayo to accelerate its growth and strengthen its industry leadership,” said Dan Caruso, Chairman and CEO, Zayo.
The company also announced that under the new ownership, Zayo’s team would continue to execute the Company’s strategy and remain headquartered in Boulder, Colorado.
Marc Ganzi, Managing Partner of Digital Colony, said, “Zayo has a world-class digital infrastructure portfolio, including a highly-dense fiber network in some of the world’s most important metro markets. We believe the company has a unique opportunity to meet the growing demand for data associated with the connectivity and backhaul requirements of a range of customers.”
“We are excited by the opportunity to team up with Zayo, in a transaction reflecting EQT’s commitment to investing in market leading infrastructure companies whose innovations and services are transforming society,” added Jan Vesely, Partner at EQT Partners, Investment Advisor to EQT Infrastructure.
The acquisition deal is expected to close in mid-2020, as it is subject to customary conditions, including regulatory clearance and Zayo shareholder approvals.