Lightower Fiber Networks, Sidera Networks to merge

Metro fiber-optic network services provider Lightower Fiber Networks will merge with fellow network services supplier Sidera Networks in a more than $2 billion deal led by Berkshire Partners, a Boston-based investment firm, and management.

[UPDATED] Existing Lightower investor Pamlico Capital and Sidera investor ABRY Partners will remain investors in the new company. M/C Partners, which joined with Pamlico Capital to acquire Lightower from National Grid plc in August 2007, will sell its stake as part of the deal, as will fellow Lightower investor Ridgemont Equity Partners. Contrary to what Lightwave reported previously, Sidera investor Spectrum Equity Investors will remain invested in the new company.

Current Lightower CEO Rob Shanahan will lead the new company. The merger is expected to close in the second quarter of 2013, pending regulatory approval.

"Lightower and Sidera together will offer customers an industry-leading, fiber-based network with a deeply experienced team supporting it," stated Shanahan. "Both companies have a shared vision of network excellence, customized solutions, and superior customer support. Once merged, we will offer customers more services, more routes, and more access options with the same high levels of performance, diversity, reliability, and support that our customers have come to expect from us."

Lightower has operated in the Northeast (see, for example, "Lightower Fiber Networks launches 100-Gbps services via Ciena 6500"), while Sidera has focused on the Mid-Atlantic and the Midwest as well as the metro New York City area (see "RCN Metro Optical Networks re-launches as Sidera Networks" and "Sidera Networks announces Xtreme Ultra-Low Latency Network expansion"). The combined company therefore will operate in all three regions of the U.S., as well as offer connections to landing sites and exchanges internationally. The combined network will have more than 20,000 route miles and provide access to more than 6,000 on-net locations, including commercial buildings, data centers, financial exchanges, content hubs, and other interconnection facilities.

The two companies offer Ethernet, dark fiber, wavelengths, Internet access, private networks, and colocation services, as well as customized offerings such as low-latency connections.

"This combination is highly complementary," commented Mike Sicoli, CEO of Sidera. "The broad reach and scale of our combined network, the cumulative expertise of our dedicated employees and our shared passion for customer service and satisfaction will set the new company apart and deliver tangible benefits to our customers."

"Berkshire is excited to be working with both Lightower and Sidera -- two great companies and two great teams," explained Randy Peeler, managing director of Berkshire. "We have invested in the telecommunications infrastructure space for nearly 20 years and believe that the combined company, with its incredibly robust network, is well positioned for continued growth serving customers with an ever-increasing need for high-performance bandwidth." Berkshire’s previous telecommunications-related investments include Crown Castle International (NYSE: CCI) and The Telx Group.

Additional terms of the deal were not disclosed.

For more information on high-speed transmission systems and suppliers, visit the Lightwave Buyer’s Guide.