- Zayo will acquire Crown Castle’s fiber assets, adding 90,000 route miles to its long-haul network
- The move comes as Zayo anticipates a “shift in AI gravity,” according to neXtCurve analyst Leonard Lee
- Crown Castle’s fiber business has faced financial trouble for some time
Zayo’s long-haul fiber biz just got a hefty boost, as the company announced it will acquire Crown Castle’s fiber assets for $4.25 billion.
The transaction will see Zayo add approximately 90,000 new route miles to its network, connecting metro areas like New York, Los Angeles and Miami "where high speed, low latency routes are needed and growing," said Marc Ganzi, CEO of DigitalBridge (which partially owns Zayo), on LinkedIn.
Unsurprisingly, Zayo intends to use Crown Castle’s assets to connect data centers across the country and provide enterprises improved access to the networks that power cloud computing and AI. The company has long-predicted the surge in demand for AI-based services and has been preparing accordingly, Zayo’s product chief Bill Long told us in February.
News of the acquisition comes after Reuters reported in January Zayo was the frontrunner to buy Crown Castle’s assets, outbidding private equity firm TPG.
According to neXt Curve Executive Analyst Leonard Lee, Zayo is diversifying its portfolio in anticipation of “a shift in AI gravity.”
Essentially, the move aligns with the narrative that AI “will transition from massive model training [via] multi-site superclusters to what is expected to be a larger inference opportunity,” he told Fierce, as enterprises and consumers continue to consume AI services.
Money from AI networking is already flowing for Zayo, which closed more than $1 billion in AI-related contracts in 2024 and has another $3 billion in the pipeline. Fellow long-haul fiber player Lumen has also doubled down on data center and AI connectivity, with more than $8 billion worth hyperscale networking deals under its belt.
The Reuters report had hinted Zayo could also acquire Crown Castle’s small cell business, however EQT – Zayo’s other parent company – will independently acquire those assets. What Zayo will do is provide fiber to those small cells via a “long-term commercial agreement.”
All told, the combined value of Crown Castle’s fiber and small cell businesses is $8.5 billion. The transaction with Zayo is expected to close in the first half of 2026.
Crown Castle’s troubled fiber biz
Crown Castle owns and operates more than 40,000 towers across the U.S., many of which are used by the big 3 wireless carriers. But the state of its fiber business has been shaky for years.
In late 2023, investment firm Elliott Management urged Crown Castle to undertake a strategic review of its fiber assets, claiming the current business was a “value-destructive strategy.”
As if Crown didn’t have enough problems, longtime CEO Jay Brown left the company shortly after Elliott called for the strategic review – kicking off a drama-filled leadership saga.
Ganzi on LinkedIn said he wished Crown Castle “all the best as you pivot rightfully to a full tower business model and unlock value for your shareholders.”