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U.S.-based fibre operator to retain Allstream brand for voice, unified comms, SME services.
U.S.-based fibre operator Zayo on Friday completed its C$465 million (€293.5 million) acquisition of Canada’s Allstream, the business services division of MTS.
Zayo said that it will reorganise Allstream into two business units. The first, called Zayo Canada, will own and operate the Canadian fibre and data centre assets and align its product portfolio with that of its new parent. Zayo Canada will account for approximately half of Allstream’s revenue, Zayo said.
The second unit will offer Allstream’s voice, unified communications, and SME services under the Allstream brand.
Allstream’s current president, Michael Strople, will serve as managing director of both business units, and will report to Karl Maier, president of Zayo International.
"Our goal is to unlock the potential of Allstream’s assets to generate value for customers and shareholders," said Dan Caruso, CEO of Zayo, in a statement. "The new structure will enable both business units to better focus on their customers in order to grow and innovate."
Zayo agreed to acquire Allstream in November. It was put up for sale by MTS as part of a broader restructuring of the telco.
The deal adds more than 18,000 miles to Zayo’s fibre network, including 12,500 miles of long-haul fibre and 5,500 miles of metro fibre.
"The closing of this transaction represents an important milestone in delivering on the commitments we have made to our shareholders," said MTS chief executive Jay Forbes.
After closing costs, MTS said it expects to realise net proceeds of approximately C$420 million.
"With this exit from Allstream, MTS is in an improved position to continue our transformation to become a true, customer-first organisation," Forbes said.
