As
a report had suggested,
T-Mobile wants to acquire fiber Internet Service Provider (ISP) Metronet through a joint venture with investment company KKR. The telecom operator will invest around $4.9 billion for a 50 percent equity stake in the joint venture and all of Metronet’s residential retail operations and customers.
T-Mobile, which calls itself the fastest-growing fixed wireless broadband provider, wants to expand its fiber footprint and cater to customers who want fast and reliable broadband. Instead of building everything from the ground up,
T-Mobile will use Metronet’s fiber infrastructure to bring fiber internet services to its customers. It relies on a similar arrangement to provide fiber services in some markets.Metronet is the fastest-growing fiber company in the US and currently counts 2 million households and businesses across 17 states as customers. After the planned acquisition,
T-Mobile will get all of Metronet’s residential fiber retail operations and customers. Metronet will become a wholesale services provider for its retail customers.
T-Mobile also plans on expanding Metronet’s services by utilizing its digital and fiber infrastructure expertise and is aiming for a customer base of 6.5 million by 2030. The carrier will be responsible for attracting customers and providing support, while Metronet will focus on technical things such as build plans, network engineering, and customer installation. According to the company’s CEO Dave Heimbach, the partnership will allow the company to “expand its fiber network faster and farther.”
Oak Hill Capital, which is the majority owner of Metronet, will sell its stake to the joint venture and re-invest to keep a minority position.
The transaction is expected to close next year and like other deals like this, it will only go ahead if regulatory approval is granted.
Given some lawmakers in the US are trying to block T-Mobile’s purchase of UScellular’s operations and also want to unwind the Sprint merger, it will be interesting to see how this acquisition plays out.
