Bell Canada to Acquire Ziply in Latest Fiber M&A Development

Bell Canada, a subsidiary of BCE, announced today that it will acquire Ziply Fiber, which serves the U.S. Pacific Northwest, in a deal valued at C$7B, which would make it the third-largest fiber provider in North America, behind AT&T and Verizon.

The acquisition would expand Bell’s territory into the U.S. and add approximately 1.3 million locations to its footprint and give it a total of 9 million locations, with objectives to reach over 12 million by 2028.

"This acquisition marks a bold milestone in Bell's history as we lean into our fiber expertise and expand our reach beyond our Canadian borders, said Mirko Bibic, President & CEO, BCE and Bell Canada in a press release.

The deal is expected to close in the second half of 2025, pending regulatory approval. Ziply will remain headquartered in Kirkland, WA and will operate as a separate unit.

"Bell's leadership and vision aligns perfectly with our commitment to improve the connected experiences of our communities through fast, reliable fiber Internet and a refreshingly great experience,” said Harold Zeitz, CEO, Ziply Fiber.

Financing the Ziply acquisition

Bell is selling off Maple Leaf Sports & Entertainment which gives it C$4.2 billion with which to fund the deal. The purchase price is C$5 billion and BCE will assume outstanding net debt of around C$2.0 billion as part of the deal.

“The purchase price of the Acquisition is anticipated to be approximately C$5.0 billion, C$4.2 billion of which is expected to be funded from the net proceeds of the divestiture of MLSE,” the press release stated.

“BCE expects to fund the balance of the purchase price from a discounted treasury DRP program (details below). In the event that the close of the sale of BCE's ownership stake in MLSE occurs after the close of this Acquisition, Bell has entered into a U.S. $3.7 billion fully committed delayed-draw term loan facility to finance the Acquisition.”

Fiber race

The Ziply news comes at a time of some consolodation and racing to own the long-term digital infrastructure that fiber provides for the connectivity needs of consuers and businesses.

With Verizon's recent planned acquisition of Frontier, as well as AT&T's own fiber expansion goals, the heat is being turned up, particularly with $42 billion in federal subsidies about to be doled out to connect rural locations (with fiber prioritized).

Management consultancy Bain & Company wrote in August that with network transformation and competition looming, "many telecommunications companies are turning to mergers and acquisitions to add new capabilities and evolve their businesses for the next era."

They added that "financial investors are acquiring fixed assets, which suggests confidence in digital infrastructure’s business fundamentals despite recent headwinds."