Northleaf Capital Partners said today that it has acquired a controlling interest in Mercury Broadband and will invest up to $230 million over the next several years to support the provider’s expansion plans.
Mercury Broadband, also known as Mercury Wireless, won Rural Digital Opportunity Fund (RDOF) money to cover some of the costs of deploying a combination of fixed wireless and fiber broadband to unserved and underserved rural areas of several midwestern states.
Northleaf calls itself a “global private markets investment firm.” It has raised $21 billion in private equity, private credit and infrastructure commitments from public, corporate and multi-employer pension plans, endowments, foundations, financial institutions and family offices. The company currently has 500 active investments.
Mercury Northleaf Deal
Mercury recently had RDOF funding authorized for bids in Indiana, Michigan, Ohio, Illinois, Missouri and Kansas. The company also had winning bids in Iowa and Nebraska.
RDOF deployment plans call for fiber broadband supporting gigabit speeds and fixed wireless service supporting speeds of 100 Mbps downstream and 20 Mbps upstream. According to a press release about the Northleaf investment, planned deployments in the six authorized states will include hundreds of fixed wireless access sites and more than 12,000 miles of fiber plant.
A Broader Trend
The Northleaf Mercury Broadband news is the latest example of an investment firm including a broadband provider in its portfolio. These investments often involve the investment firm acquiring the entire company, as when ATN International, Inc. and Freedom 3 Capital bought Alaska Communications, when Stonepeak acquired Astound Broadband and when Macquarie Infrastructure Partners acquired Cincinnati Bell.
We are likely to see more investments of this nature moving forward, now that the federal government has made an unprecedented level of funding available for broadband deployment, and as the U.S. continues to focus on making broadband available nationwide.
“Mercury Broadband’s commitment to bridging the digital divide is an excellent fit with our communications infrastructure investment strategy and provides our investors with exposure to an attractive sector with a compelling risk/return profile and significant growth potential,” said Chris Rigobon, director at Northleaf, in a press release.