Bank Street Wins 2020 TMT M&A Award

STAMFORD, CT – Bank Street Group, a leading investment banking firm serving the technology, media and telecommunications sectors, was named a winner at the TMT M&A Awards 2020 as Communications Infrastructure & Services M&A Advisor in the Americas. With 10 qualifying deals during the judging period, Bank Street was ranked number one ahead of nine other global investment banks, highlighting the outstanding capabilities of our team and the strength of our M&A advisory practice. The award recognizes the critical role that Bank Street has established as a leading independent advisor in this sector.

"It is a great honor to have our firm recognized in the TMT M&A Awards," commented Richard Lukaj, Senior Managing Director of Bank Street. "We extend our thanks to our clients for entrusting their critical financial and strategic transactions to our firm for nearly two decades and to the TMT Finance panel of judges for recognizing the remarkable results that we have delivered over the past year. We exited 2020 with our transaction pipeline at record levels and we have high hopes for the New Year."

“We have built our practice around the Communications Infrastructure & Services sector with a team of professionals that distinguish themselves with deep domain expertise and unmatched transaction experience that has enabled us to consistently deliver outstanding results for our clients," continued James Henry, Senior Managing Director of Bank Street. "We remain at the forefront of transaction activity in the CIS sector and look forward to serving companies and financial sponsors in this vibrant ecosystem for many years to come.”

Bank Street provides insightful and objective advice to help our corporate and institutional clients achieve their financial and strategic goals. We are a private investment banking firm primarily serving growth companies in the communications, media and technology sectors with a comprehensive array of services, including Merger & Acquisition Advisory, Debt and Equity Capital Markets, and Restructuring Solutions. For further information, visit www.bankstreet.com.

Boston Omaha Corporation Announces Agreement to Acquire the Assets of Utah Broadband, LLC

OMAHA, Nebraska - Boston Omaha Corporation, through its wholly owned subsidiary FIF Utah LLC (“FIF Utah”), has entered into an agreement to acquire Utah Broadband, LLC (“UBB”), a family-owned broadband fiber and fixed wireless internet service provider. Founded in 2002, Utah Broadband provides high-speed internet services to its well over 10,000 customers throughout Salt Lake City, Park City, Ogden, Provo and surrounding communities.

The closing is subject to various conditions, including, among other things, further due diligence, regulatory approvals, third party consents and other normal and customary conditions to closing. The closing is anticipated to be completed, subject to the closing conditions, within the next 30 days.

Steve McGhie will continue as CEO while retaining a 20% initial ownership stake in the newly formed entity as he continues to guide Utah Broadband’s next phase of growth. The remaining 80% initial ownership stake will be owned by a wholly owned subsidiary of Boston Omaha, which intends to make significant additional capital investments to fund the company’s planned fiber-to-the-home expansion. Under the Agreement, FIF Utah will acquire substantially all of the assets of UBB and assume only certain UBB liabilities. The purchase price consists of $21,600,000 in cash to be paid at closing, subject to certain working capital and other adjustments, and the issuance of 20% of the common membership interests of FIF Utah, valued at $5,400,000, to Mr. McGhie. A portion of the cash purchase price will be held in escrow to provide a source of indemnification for any breaches of the representations and warranties, covenants and other obligations of UBB, its members and Mr. McGhie under the Agreement.

About Boston Omaha Corporation

Boston Omaha Corporation is a public holding company with three majority owned businesses engaged in outdoor advertising, surety insurance and broadband telecommunications services. The Company also maintains minority investments in a bank, a national residential homebuilder and commercial real estate services businesses.

M/C Partners Acquires Bel Air Internet, Expanding the AerioConnect Platform in Southern California

LOS ANGELES, CA. – M/C Partners, a Boston-based Communications and Technology Services focused private equity firm, announced the acquisition of Bel Air Internet, LLC (“BAI”), one of the largest privately owned Internet Service Providers to multi-family and commercial clients in Southern California providing services to over 800 buildings in the greater Los Angeles market. BAI will be combined with the recent acquisitions of AerioConnect and Metro Fiber, creating one of the largest ISP’s in the region.

 “The addition of Bel Air and its valued customers and employees to our existing operations is an exciting part of the growth strategy we have embarked upon. The expansion of our team and customer reach in the greater Los Angeles market enhances our ability to deliver high quality and feature rich services throughout the region and beyond. We are very excited to continue to deliver excellence in the services we provide while continuing to expand the geography we serve.” said Brady Adams, CEO of the newly formed, combined entity.  

Terry Koosed, founder of BAI added, “I am excited for the next chapter of BAI and the additional opportunities this acquisition provides for our employees and our customers. Supported by M/C Partners and the wonderful employees at BAI, our customers will continue to receive the premium service they have come to expect.”

“We are extremely excited to accelerate our business plan of establishing the preeminent residential and commercial broadband provider for MDUs in the region through the acquisition of BAI. The BAI team has a long history of providing highly advanced, quality services to some of the most prestigious properties in the market. BAI’s focus on customer service and network density complements our previous acquisitions and aligns us for continued success,” said Ryan Carr, Partner at M/C Partners.

About Bel Air Internet

Based in Los Angeles, BAI is a leading provider of Internet, Voice and Video services for over a decade to the greater Los Angeles market. Bel Air serves over 800 multi-family and commercial buildings throughout the Los Angeles market. Please visit us at www.belairinternet.com

About AerioConnect

Aerio is a leading provider of Internet, Voice and Video services to the greater Los Angeles market. Aerio serves over 500 multi-family and commercial buildings offering customers up to gigabit speed broadband connections throughout its footprint. Please visit us at www.aerioconnect.com

About M/C Partners

Based in Boston, M/C Partners is a private equity firm focused on small and mid-sized businesses in the communications and technology services sectors. For more than three decades M/C Partners has invested $2.2 billion of capital in over 130 companies, leveraging its deep industry expertise to understand long-term secular trends and identify growth opportunities. The firm is currently investing its eighth fund, partnering with promising companies and empowering strong leaders to accelerate growth, optimize operations, and build long-term value. For more information, visit www.mcpartners.com

AerioConnect Acquires Metro Fiber

LOS ANGELES - AerioConnect, LLC (“Aerio”), backed by M/C Partners, announces the acquisition of Metro Fiber LLC, a Los Angeles (LA) based Internet Service Provider (ISP) to multi-family residential customers in the greater LA market. Metro Fiber has provided Internet, Voice and Video to customers in the market for over ten years and focuses on providing exceptional broadband to HOA communities. The acquisition closed subsequent to M/C Partners acquisition of Aerio on September 30, 2020. Metro Fiber’s customers will continue to enjoy services provided by Aerio.

“In our continued effort to execute our business plan, we are extremely excited to acquire Metro Fiber with its valued customers and partnerships that will add to our depth in the Los Angeles market,” said Ryan Carr, Partner at M/C Partners.

“We are excited for the opportunity to serve our newly acquired Metro Fiber customers and their existing business partnerships. With the support of M/C Partners, the management team at Aerio will continue to focus on continuous evolution of our products and services to grow value for our trusted partners,” said Brady Adams, CEO of Aerio.

With the equity infusion from M/C Partners in September, Aerio will continue to expand their current geographic presence through existing partnerships, as well as acquisitions.

About Metro Fiber

Based in Los Angeles, Metro Fiber has provided Internet, Voice and Video for over a decade throughout the metro LA market.

About AerioConnect

Based in Los Angeles, Aerio is a leading provider of Internet, Voice and Video services to the greater Los Angeles market. Aerio serves over 400 multi-family and commercial buildings throughout the LA area. For more information visit https://www.aerioconnect.com/

About M/C Partners

Based in Boston, M/C Partners is a private equity firm focused on small and mid-sized businesses in the communications and technology services sectors. For more than four decades M/C Partners has invested $2.3B of capital in over 140 companies, leveraging its deep industry expertise to understand long-term secular trends and identify growth opportunities. The firm is currently investing its eighth fund, partnering with promising companies and empowering strong leaders to accelerate growth, optimize operations, and build long-term value. For more information visit http://mcpartners.com/

M/C Completes Acquisition of AerioConnect, Establishing a Platform in Residential and Commercial Broadband

Los Angeles, CA (BUSINESS WIRE) M/C Partners, a Boston-based Communications and IT Services focused private equity firm, announced the acquisition of AerioConnect, LLC. (“Aerio”), a leading Internet Service Provider to multi-family and commercial clients in the greater Los Angeles market. Aerio currently serves over 9,000 subscribers across 400 buildings in the greater Los Angeles market. The acquisition closed on September 30, 2020. Brady Adams, former CEO of Optic Access, has been appointed Chief Executive Officer and will be responsible for driving the company’s growth initiatives going forward.

“We are excited for the opportunity to partner with Aerio and build upon the strong foundation in residential and commercial broadband,” said Ryan Carr, Vice President at M/C Partners, “our plan is to reinforce our commitments with our best in class, trusted partners by investing in our products and services while expanding our reach throughout the region.”  

“I greatly appreciate the opportunity to join the Aerio team to grow Aerio’s customer base within the Los Angeles market, as well as, expand both services we provide and geography we serve” said Brady Adams. 

Brian Clark, Managing Partner of M/C Partners added, “Residential and commercial broadband services is a core focus of M/C and one we have extensive experience with from previous investments including Baja Broadband, Zayo and Lightower Networks.  We see Aerio as an attractive investment in a core area of focus with exceptional growth potential.”

With additional capital from M/C, Aerio will look to expand their current geographic presence through existing partnerships, as well as, acquisitions.

About AerioConnect

Based in Los Angeles, Aerio is a leading provider of Internet, Voice and Video services to the greater Los Angeles market. Aerio serves over 400 multi-family and commercial buildings throughout the Los Angeles market.

About M/C Partners

Based in Boston, M/C Partners is a private equity firm focused on small and mid-sized businesses in the communications and technology services sectors. For more than three decades M/C Partners has invested $2.2 billion of capital in over 130 companies, leveraging its deep industry expertise to understand long-term secular trends and identify growth opportunities. The firm is currently investing its eighth fund, partnering with promising companies and empowering strong leaders to accelerate growth, optimize operations, and build long-term value. For more information, visit www.mcpartners.com.

For more information on Aerio, visit us at https://www.aerioconnect.com/.

Nelnet Partners with SDC Capital Partners to Propel ALLO's Growth

LINCOLN, Neb., Oct. 2, 2020 -- Nelnet (NYSE: NNI) announced today it has entered into agreements to partner with SDC Capital Partners, LLC ("SDC") in which funds managed by SDC will make a $197 million equity investment in ALLO Communications, LLC ("ALLO") for an approximately 48% ownership stake in ALLO. The collaboration will provide ALLO with capital to continue expanding its all-fiber-optic network and superior service offerings into additional communities in the Midwest. The investment by SDC is expected to close in October 2020, subject to certain closing conditions.

"Exceptional communications solutions for business, government, and residential customers have become even more important during the pandemic," said Brad Moline, President of ALLO. "Communities across the Midwest are clamoring for better connectivity. We are excited to continue to deliver to all of our customers the exceptional local service that ALLO has provided for more than 15 years. With SDC, Nelnet, and our proven team of 500+ associates, we can transform how even more communities work, learn, and play."

Since 2004, ALLO has been overbuilding communities with modern fiber networks, creating GIG communities. As of June 30, 2020, ALLO's team served more than 53,000 residential subscribers and thousands of businesses as well as governmental entities across 12 communities.

"ALLO has established itself as a leading provider of fiber-to-the-premise services in Nebraska and Colorado and we are thrilled to support its growth alongside Nelnet," said Clinton Karcher, Principal at SDC. "We are firm believers that serving customers with high-quality, state-of-the-art network infrastructure and white glove customer service will result in long-term success, and ALLO embodies both of these characteristics."

"We are excited to partner with SDC to accelerate ALLO's growth," said Terry Heimes, Chief Operating Officer of Nelnet. "SDC's investment will provide the necessary capital to build out fiber networks primarily in Nebraska and Colorado and help communities and businesses meet the increasing demand for high-speed, reliable broadband with the best and latest technologies. SDC's deep sector experience and relationship network make it the ideal long-term partner for ALLO. Over the last five years, we have seen firsthand the value ALLO's technology and service bring to a community. We look forward to supporting their long-term success alongside SDC."   

The proceeds to be obtained by ALLO from the transaction, together with new third-party debt financing expected to be obtained by ALLO, will be used to fund ALLO's expansion and partially redeem outstanding senior preferred interests held by Nelnet. Additional information about Nelnet's agreements with SDC and ALLO will be provided in a Current Report on Form 8-K to be filed by Nelnet with the Securities and Exchange Commission on the date of this press release.

Nelnet acquired 92.5 percent of the outstanding equity and membership interests of ALLO on December 31, 2015. Since that transaction, Nelnet has invested significant additional capital in ALLO to build networks in Lincoln, Hastings, Imperial, and Norfolk, Nebraska and Fort Morgan and Breckenridge, Colorado.

Goldman Sachs & Co. LLC acted as financial advisor to Nelnet in connection with the transaction.

About SDC Capital Partners 
SDC Capital Partners, LLC is a global digital infrastructure investment firm. SDC invests in data centers, fiber networks, wireless infrastructure and associated businesses, with a focus on opportunities to leverage its deep operational expertise in partnership with exceptional teams to create value. For more information, please visit www.sdccapitalpartners.com.

About ALLO Founded in Imperial, Neb. in 2003, ALLO, a Nelnet company (NYSE: NNI), specializes in providing world-class communications services by creating gigabit communities. In 2004, ALLO began building its first fiber communities, and today provides ubiquitous fiber networks in 12 communities supported by more than 500 associates. ALLO provides broadband, telephone, and video solutions to businesses, residents, and governmental entities over fiber networks. ALLO currently has operations in Lincoln, Hastings, North Platte, Ogallala, Imperial, Bridgeport, Scottsbluff, Gering, Alliance, and Norfolk, Neb., and Fort Morgan, and Breckenridge Colo. For more information, visit AlloCommunications.com.

About Nelnet Nelnet (NYSE: NNI) is a diversified and innovative company focused on offering educational services, technology solutions, telecommunications, and asset management. Nelnet helps students and families plan and pay for their education and makes the administrative processes for schools more efficient with student loan servicing, tuition payment processing, and school administration software. Through its subsidiary, ALLO Communications, Nelnet offers fiber optic services directly to homes and businesses for ultra-fast internet and superior telephone and television services. The company also makes investments in real estate and early-stage and emerging growth companies. For more information, visit NelnetInc.com.

SBA Communications Acquires JAX NAP

Bank Street served as exclusive financial advisor to JAX NAP in connection with the transaction

Stamford, CT – August 4, 2020 – SBA Communications announced the acquisition of JAX NAP, owner and operator of the primary data center and carrier hotel in Jacksonville, FL, which serves as a regional colocation and interconnection hub for carrier, cloud, content and enterprise customers. Located at 421 West Church Street, the 280,000 sq. ft. building has 14 MW of power capacity and offers connectivity to more than 20 fiber network providers, including two international subsea cable systems.

"Bank Street’s deep knowledge of the rapidly evolving digital infrastructure sector and strong relationships within the data center and broader communications ecosystem allowed them to orchestrate a highly competitive process on our behalf that resulted in a successful outcome for JAX NAP's shareholders," stated Luke Leonaitis, Founder & President of JAX NAP. "We are very pleased with the outcome of this transaction and confident that SBA will be a great partner for our customers, employees and service providers going forward."

SBA Communications is a leading independent owner and operator of wireless communications infrastructure, including towers, rooftops, distributed antenna systems, small cells and data centers. SBA’s acquisition of JAX NAP is the company's second transaction in the data center sector following its acquisition of New Continuum Data Centers in 2019. SBA's data center acquisitions have been executed in connection with its Mobile Edge Computing (MEC) strategy as the company complements its edge assets with core colocation facilities in key markets.

Bank Street served as exclusive financial advisor to JAX NAP in connection with this transaction.

About Bank Street

Bank Street provides insightful and objective advice to help our corporate and institutional clients achieve their financial and strategic goals. We are a private investment banking firm primarily serving growth companies in the communications, media and technology sectors with a comprehensive array of services, including Merger & Acquisition Advisory, Debt and Equity Capital Markets, and Restructuring Solutions.

Xplornet Announces Completion of Sale to Stonepeak Infrastructure Partners

Deal will enable Xplornet to improve coverage, increase investment and accelerate its plan to deliver a national fibre, wireless and satellite network to improve broadband for rural Canadians  

WOODSTOCK, NB, June 11, 2020 /CNW/ - Xplornet Communications Inc., Canada's largest rural-focused broadband service provider, today announced the completion of its sale to Stonepeak Infrastructure Partners, whereby Stonepeak has acquired the controlling stake in Xplornet. The transaction has received all regulatory approvals and completed new financing for a fully capitalized business.    

Today's announcement empowers Xplornet to execute its plan of accelerating investment in its national hybrid fibre wireless and satellite broadband network for rural Canadians. Xplornet has fresh new capital for a strong balance sheet, a new owner with the same conviction to the company's mission as its employees, and a renewed sense of purpose on improving broadband services for rural Canadian homes and businesses.  

Stonepeak is a North American focused infrastructure firm that manages $24.4 billion USD of assets for its investors (as of May 22, 2020). The firm has a strong track record of investing in mission-critical telecommunication businesses globally. Stonepeak is committed to supporting the existing Xplornet business plan. Allison Lenehan, the Chief Executive Officer, and the current executive team will continue leading Xplornet and the company will remain headquartered in New Brunswick.

"We are thrilled to complete our sale to Stonepeak and begin the next chapter of Xplornet. Rural Canadians deserve world-class broadband and we are fixated on delivering for them. We know there is more work to do," said Allison Lenehan, President and CEO of Xplornet.

"This deal will enable Xplornet to expand coverage, increase investment, and accelerate improvements to our broadband network. For our customers, this means unprecedented speeds, unlimited data plans, and 5G services at affordable prices. Rural Canadians deserve access to the same quality of broadband as in urban Canada. It is time to go faster," said Lenehan.

Brian McMullen, Senior Managing Director and head of Stonepeak's communications and digital infrastructure business added: "We are delighted to partner with Allison and the Xplornet team to build upon the premier broadband provider they have established. In an increasingly digital society, we believe there is an opportunity to deliver faster speeds and greater coverage, supporting the ability to work from home, distance learning, more connected devices and shifting entertainment mediums. We look forward to continuing to invest in the company's network infrastructure and service capabilities to support an exceptional broadband proposition.

Today's announcement builds on the investments in fibre and 5G wireless technology already made by Xplornet throughout Canada. In 2019, Xplornet announced that it will invest $500 million over the next five years to deploy state-of-the-art hybrid fibre wireless and satellite technology in its facilities-based network in order to deliver broadband services to rural Canadians. The completion of its sale to Stonepeak is one more step in making this promise a reality.

About Xplornet Communications Inc.

Headquartered in Woodstock, New Brunswick, Xplornet Communications Inc. is one of Canada's leading broadband service providers. For over a decade, Xplornet has been providing innovative fixed and mobile broadband solutions to rural customers at work, home and play across Canada.  Today, Xplornet offers voice and data communication services through its unique hybrid fibre wireless and satellite network that connects Canadians to what matters.

About Stonepeak Infrastructure Partners

Stonepeak Infrastructure Partners (www.stonepeakpartners.com) is an infrastructure-focused private equity firm headquartered in New York that manages $24.4 billion of assets for its investors (as of May 22, 2020). Stonepeak invests in long-lived, hard-asset businesses, and projects that provide essential services to customers and seeks to actively partner with high-quality management teams, facilitate operational improvements, and provide capital for growth initiatives.

Research: It’s a Two Horse Broadband Race Between FTTP and Cable Broadband

Communications industry financial analysts at MoffettNathanson Research expect to see continued cable broadband market share gains, which have accelerated as bandwidth demand climbs during the COVID-19 pandemic. The researchers’ “equilibrium” forecast calls for DSL market share to drop to zero. And “mid-tier” telco broadband increasingly is becoming “just as obsolete,” the researchers said.

“Broadband is increasingly a two-horse race between cable and telco FTTH, where it exists,” MoffettNathanson argues in a new research note.

The COVID-19 Impact
MoffettNathanson isn’t the first research firm to note that cable made major broadband gains in the first quarter of 2020. Leichtman Research Group noted that the top cable broadband additions were up 122% over the same quarter of 2019, while the top telco broadband providers had a net loss of about 65,000 subscribers, compared to a net gain of about 20,000 in the first quarter of 2019.

Like LRG, MoffettNathanson attributes these changes to increased bandwidth demand as people spend more time at home during the COVID-19 pandemic.

“The increased level of usage was enough to convince many customers that they needed higher speeds to handle the number of simultaneous users in their home,” MoffettNathanon wrote.

The MoffettNathanson researchers also noted another dimension to the cable broadband market share gains. New household formation was quite high in the first quarter of 2020 – at least until the COVID crisis hit.

The implication of that finding is that cable’s broadband long-term gains may not be quite so impressive – and that telco losses likely would have been even worse were it not for new households ordering broadband.

Cable Broadband Market Share
MoffettNathanson defines “mid-tier” telco broadband to include fiber-to-the-node (FTTN), IP-DSLAM and VDSL technology supporting speeds as low as 10 Mbps and as high as 75 Mbps but with speeds that generally don’t exceed 25 Mbps.

“The pressures on broadband networks laid bare by the coronavirus crisis make it clear that market share will now migrate even faster in this large cohort,” the researchers argue. “As with legacy DSL, it is increasingly clear that this segment is simply not competitive anymore. Equilibrium market share in this cohort, if one looks out far enough, is 100/0.”

In the near term, the researchers expect to see cable companies take an 85% share of broadband connections in markets where they compete against mid-tier telco broadband. Even more negative for telcos, MoffettNathanson no longer sees telcos having an advantage against cable in FTTH markets. In the past, the researchers expected to see telcos gain 60% of broadband connections in markets where they had deployed FTTH but that projection was later reduced to 50/50. And according to today’s note, the researchers don’t envision that changing any time soon.

“It is . . . no longer sensible to argue that fiber has a technological advantage over cable,” the researchers argue. “With the coming advent of DOCSIS 4.0 (likely to be called ‘10G’), cable operators will be able to deliver 10 Gbps symmetrically. One has to look out well beyond 4K video to full virtual reality, and perhaps even holography, for applications that would make a 10 Gbps service insufficient.”

Internet-Connected Video Devices are in 67% of U.S. Broadband Homes

Two-thirds of U.S. broadband households own Internet-connected video devices, according to a new report from Parks Associates.

The firm says that the devices, which include smart TVs, streaming media players, Internet-connected gaming consoles and connected PVR/DVRs, are serving for longer periods of time.

These lengthening replacement cycles are a challenge to manufacturers, who are responding with tactics including software and service offerings, exclusive hardware-content bundles and open ecosystems. This challenge and thin margins are reducing the field of competitors, the firm says.

“The connected entertainment space is moving towards a smartphone model, in which a handful of platform players control the operating system, UX, and consumer access to services and features,” Parks Associates’ Senior Analyst Kristen Hanich said in a blog post about the internet-connected video devices report. “These platform players stand to win big as consumers increasingly choose to sign up for their OTT service subscriptions through storefronts like Amazon Prime Video Channels, Apple TV Channels, or Roku Channel Premium Subscriptions.”

Hanich said that the rise of OTT services and fading of pay TV subscriptions results in fragmentation in the content services market as multiple paths to consumers are created. This, coupled with the fact that consumers now want to be able to access content when and where they are, is pushing toward open ecosystems that enable customers to get “most if not all” of what they want on any device regardless of the platform they are using.

Internet-Connected Video Devices Report
Other recent Parks research complements Hanich’s conclusions. In January, Parks found that 77% of smart TVs are connected to the Internet. This is a 62% increase since 2014. The firm also found that half of the 10,000 US households surveyed own a smart TV.

In October 2019, Parks found that homes with more than one OTT video subscription had increased 130% since 2014. In August, the firm said that monthly consumer spending on traditional pay TV had declined from $84 to $76 between 2016 and 2018.