Zayo Group outlines IPO

Venture capital-backed Zayo Group, which has been ambitiously building an international fiber network through acquisitions, now has plans to go public.
The Colorado-based company recently filed its S1 form for an initial public offering with the Securities and Exchange Commission. The number of shares and price have not yet been determined, but the company indicated a proposed maximum aggregate offering of $100 million.
Zayo notes in its filing that its key products include leased dark fiber and fiber to cellular towers and small cell sites, along with other types of Ethernet and IP connectivity, and said that it counts wireless service providers and other telecom companies among its customers.
The company reported that as of March 31, it had more than $4.3 billion in revenue under contract; and that at the end of the same quarter it had annualized revenues of $1.139 million. However, Zayo has yet to generate a profit and warned potential investors that it expects the same to continue for several years; the company noted that it has used all of its positive cash flow to make more purchases and investments.

Zayo was founded in 2007 to take advantage of the anticipated fiber needs of telecom and media companies, large businesses and government with the expansion of mobile services, increased connectivity services and the “Internet of Things.” As of June 30, Zayo said it had spent $3.7 billion to acquire 30 bandwidth infrastructure companies. It announced late last week that it had completed its purchase of Paris-based Neo Telecoms and that ZColo, its co-location division, had acquired a data center and managed service provider in Atlanta. 

Zayo said that as of the end of March, its fiber network spanned more than 77,000 route miles and 5.7 million fiber miles, served 297 geographic markets in the U.S. and Europe, and connected to 14,490 buildings. Zayo said that figure includes 3,838 cellular towers and 527 data centers. “We believe our networks provide significant opportunity to organically connect to new customer locations, data centers, towers, or small cell locations to help us achieve an attractive return on our capital deployed,” Zayo said in its filing.  
Watch an RCR Wireless interview with Dave Jones, who heads Zayo’s fiber-to-the-tower group: