Zayo to buy colo provider Latisys, expand western dark fiber network

Zayo Group Holdings, Inc. (NYSE:ZAYO) has announced a pair of expansion initiatives. The company has agreed to acquire through its Zayo Group business the operating units of Latisys Holdings, LLC, a provider of colocation and infrastructure as a service (Iaas) offerings, for $675 million. The company also revealed plans to extend its long-haul dark fiber network between Salt Lake City and Sacramento.

Latisys provides colocation and IaaS products via eight data centers in five markets – Northern Virginia, Chicago, Denver, Orange County, CA, and London. The data centers encompass more than 185,000 square feet of billable space and 33 MW of power, with the ability to expand, Zayo says. The company serves about 1,100 predominantly medium to large enterprise customers.

Latisys generated adjusted EBITDA of approximately $11.0 million for the three months ended September 2014 and approximately $4.2 million for the month of November 2014.

Zayo will pair the Latisys assets with its existing zColo colocation facilities and its dark fiber network infrastructure. The assimilation of the Latisys facilities will bring Zayo's total number of data centers within the U.S., France, and the United Kingdom to 45.

Meanwhile, the Salt Lake City-to-Sacramento network expansion will add more than 800 route miles to Zayo's long-haul fiber-optic network. Zayo sees the new fiber cable infrastructure as further enabling connectivity between such major West Coast data center markets as Los Angeles, Seattle, and the Bay Area, as well as to other major data center markets across the rest of the country.

The company expects to complete the project, which is already under way, by the end of the year.

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