Infrastructure provider Zayo has altered some business arrangements to better position it to enhance growth, invest in networks, and meet customer needs, the company says. The company, which operates networks that span over 19.1 million fiber miles and 147,000 route miles, late last month entered into a transaction support agreement (“TSA”) with creditors holding collectively more than 95% of outstanding term loans, secured notes, and unsecured notes issued by Zayo Group Holdings, Inc.
The Zayo TSA amends certain terms and extends maturities to 2030. Zayo will commence a series of exchange offers with respect to these debt instruments subject to finalization of the definitive documentation.
“We are making important progress executing on our strategic plans and positioning Zayo as a leader in delivering purpose-built long-haul routes that are critical to the next generation of AI-enabled technologies,” Zayo CFO Jeff Noto said in a press release about the TSA.
“With flexibility to pursue future alternative sources of financing, such as asset-backed securitization and project financing, we’ll be better able to invest in network growth and support our customers’ growing connectivity needs. We appreciate the support of our lenders and other financial stakeholders and look forward to solidifying our position in the digital infrastructure economy for years to come.”
Asset-backed securitization (ABS) enables a company to borrow money at a favorable interest rate by securing the funds with assets that are highly valued and contracts that are seen as low risk.
Before the TSA announcement, Zayo announced its move into ABS in early February. The company said it will issue notes valued at over $1.4 billion and secured with fiber infrastructure and long-term customer contracts in the company’s northeast region. The transaction was to close on February 14. The notes will be due in 2030.
The move came less than a month before Zayo announced that it had entered into an agreement to acquire Crown Castes’ Fiber Solutions in a transaction valued at about $4.25 billion. That deal is being paired with Zayo backer EQT’s acquisition of Crown Castle’s small cell business.
