Infrastructure investment firm HRL Morrison is leading a consortium that will acquire US digital infrastructure company FiberLight.
The consortium, which includes Australia’s second largest superannuation fund Australian Retirement Trust (ART), has signed a definitive agreement to acquire FiberLight from asset development business Thermo Companies.
Financial details of the transaction have not been disclosed but it is believed to value FiberLight at around $1.5 billion.
Global asset managers Apollo Global Management and KKR have also made investments in fibre communications.
Chief executive Paul Newfield said the FiberLight acquisition would expand Morrison’s presence in the North American market. FiberLight is a top-ten, high-bandwidth business delivering services to customers in over 30 metropolitan areas mostly around Texas and Northern Virginia, the largest data centre market in the world, he said.
Morrison’s New York-based chief investment officer, William Smales, added: “This investment closely aligns with our strategy of backing strong, purpose-driven companies with highly defensive characteristics and dependable long-term cashflows.”
ART’s head of private real and mid-risk assets, Michael Weaver, said: “We recognise the critical role of high-speed connections in today’s society and we look forward to working with the team to help build communications infrastructure for the future.”
Established around 20 years ago, FiberLight is a leading builder and operator of fibre-optic communications infrastructure typically used in mission-critical high-bandwidth networks.
FiberLight expects to use the new capital to accelerate its network expansion in a rapidly growing market.
Based in Atlanta, Georgia, the company currently manages around 43,000 kilometres of fibre infrastructure. FiberLight’s customers span the business, government and education sectors.
Chief executive Christopher Rabii, who will continue to lead FiberLight, said Morrison was an ideal partner to support the company’s growth strategy as Morrison shared its belief that fibre infrastructure is the key to bridging the digital divide.
FiberLight’s current owner, Thermo Companies, was established in 1984 to develop power plants and natural gas assets in Colorado. The cash flow generated from these energy assets has since been invested long term across a range of other industries including telecommunications.
FiberLight was spun out of data systems company Xpedius and was acquired by Thermo Companies in 2005.
The investment will be Morrison’s third investment in North America since it opened its New York office in 2021 and follows investments in renewable energy company Longroad Energy and evergreen venture capital fund manager Clearvision Ventures.
Morrison’s existing stakes in digital infrastructure include: mobile phone services provider Vodafone NZ, communications towers company Amplitel, CDC Data Centres (acquired from Quadrant Private Equity), UK data centres company Kao Data, Netherlands fibre networks company Fore Freedom, and Australian Registry Investments which operates the land titles ownership system in NSW.
Wellington, New Zealand, based Morrison is the manager of listed infrastructure investment company Infratil (ASX/NZX: IFT) which owns some of the digital stakes.
Morrison was advised on the FiberLight acquisition by TD Securities, financial, and Torys LLC, legal. FiberLight’s financial adviser was Bank Street and legal adviser, Taft.
Image: FiberLight builds and operates fibre-optic communications infrastructure typically used in mission-critical high-bandwidth networks.