Private equity firm Grain Management LLC is emerging as a major fiber network consolidator. In the past week, the company announced two network operator acquisitions, after having previously announced several others in the last year or so.
Grain Management’s latest acquisition, announced earlier this week, is Hunter Communications, a provider of voice and data services to businesses and homes in southern Oregon and northern California that also has a 2,000-mile fiber network.
The latter asset seems to be of greatest interest to Grain Management, as a Grain Management managing director is quoted in the release as saying that the investment firm’s “value creation strategy” will focus on densifying and expanding Hunter’s footprint and advancing “its position as a leading regional connectivity provider.”
The day before, Grain Management said it would acquire Summit Broadband, a fiber network operator in Florida.
Fiber Network Consolidator Grain Management
Grain Management did not immediately respond to an interview request from Telecompetitor to talk about its acquisition strategy, but a review of the other acquisitions Grain Management has made in the last year or so indicates an emphasis on regional fiber networks. Initially the company appeared to be concentrating on the central U.S., but the planned Hunter and Summit acquisitions suggest the company is casting a wider net.
Previous acquisitions include:
- Great Plains Communications, a triple-play provider that also operates a regional fiber network in the Midwest
- InterCarrer Networks, operator of a fiber network in parts of Illinois, Indiana, Missouri and Kentucky
- Ritter Communications. Grain Management acquired a majority stake in this operator of a fiber network in Arkansas, Missouri and Tennessee
- WAN Rack. Grain Management acquired a controlling stake in this company, which focuses on constructing fiber networks
It’s not surprising to see interest in fiber networks increasing. As wireless carriers deploy 5G, they are expected to need increasingly high-speed connectivity to fiber networks to support dramatically higher traffic volumes. And they will rely, in large part, on companies like those Grain Management is acquiring to provide that connectivity. Additionally, as more companies and enterprises rely on the cloud and data center connectivity, the value of the networks that enable that connectivity will increase.
Grain Management isn’t the only company focused on acquiring fiber network operators and broadband providers. Other companies that have been playing the consolidator role include Vyve Broadband, GTCR, Wave Broadband, and TPG Capital (owner of RCN and Grande). We’ve also seen one consolidator acquiring another, as happened with TPG Capital’s acquisition of Wave Broadband and with GTCR’s acquisition of Vyve.