GTCR, a private equity firm, today announced that it has made a strategic investment in fiber provider Point Broadband to grow the company’s fiber network. Prior to GTCR’s investment, Point Broadband was owned by Stephens – Private Capital (26% stake), ITC Capital Partners (22% stake) which has financial backing from Cam Lanier, and Kinetic Ventures (also Cam Lanier).
Point Broadband – Overview
Point Broadband was founded in 2017 and is headquartered in Georgia. The company provides fiber-to-the-premise (FTTP) services to residential and business customers. Specifically, Point Broadband operates in nine states including Alabama, Georgia, Maryland, Michigan, Mississippi, New York, Ohio, Tennessee, and Virginia.
Overall, Point Broadband passes more than 400k homes and businesses with fiber broadband services. Additionally, the company is actively expanding its fiber footprint through new fiber-to-the-premise (FTTP) builds in near-adjacent markets. Specifically, the company highlights that it is constructing new fiber infrastructure for additional communities in the states of Alabama, Maryland, Michigan, New York, and Ohio.
GTCR’s investment in Point Broadband will accelerate the company’s fiber network expansion. In turn, the company will be able to offer fiber-based broadband to underserved communities in the U.S.
Rural Digital Opportunity Fund (RDOF) – Support Won
Point Broadband’s fiber deployment has the support of funds from the Rural Digital Opportunity Fund (RDOF), which is a program of the Federal Communications Commission (FCC). Indeed, Point Broadband was a major recipient of funds from the RDOF Phase I Auction (Auction 904), securing the 19th highest level of support.
In the RDOF Phase I Auction, Point Broadband received support of $78.4m, over 10 years. Specifically, this support was awarded in 34.5k locations, equating to $2,275 of support per location. Notably, Point Broadband’s support is in 5 states, namely Alabama ($51.0m), Georgia ($4.2m), Michigan ($11.4m), New York ($6.6m), and Virginia ($5.1m).
Overall, Point Broadband will use the RDOF funding to construct and operate new fiber optic networks. To this end, the company intends to provide download speeds of 1 gigabit per second and upload speeds of 500 megabits per second. Using this newly-built fiber network, the company will offer voice and high-speed broadband Internet access services to the designated census blocks it won in the RDOF Phase I Auction.
Transaction Advisors – Point Broadband and GTCR
Point Broadband’s financial advisors were Stifel and Houlihan Lokey.
GTCR’s financial advisors were Credit Suisse and Rothschild. Additionally, GTCR’s legal advisor was Kirkland & Ellis.
GTCR – Overview
GTCR, a Chicago-based private equity firm, has invested more than $20bn in over 250 companies since inception. Overall, the firm has extensive experience investing in both the telecommunications and digital infrastructure sectors. Specifically, GTCR’s relevant investments include:
- Mega Broadband: in October 2017, GTCR formed the company alongside Phil Spencer. Subsequently, the business grew through a series of acquisitions under the Vyve Broadband brand. Additionally, in September 2020, GTCR sold a 45% stake in Mega Broadband to Cable One
- Zayo Group: in May 2012, GTCR invested in Zayo Group to finance a portion of its acquisition of AboveNet
- Consumer Cellular: in October 2020, GTCR agreed to acquire the business for $2bn