BCE, a Canadian telecommunications company, recently announced its acquisition of U.S. fibre internet provider Ziply Fiber for approximately $5 billion in cash. This move was made possible by the proceeds from the sale of BCE’s stake in Maple Leaf Sports & Entertainment, a sports conglomerate, earlier in the fall. The sale of this stake to rival Rogers Communications for $4.7 billion allowed BCE to reallocate capital into the acquisition of Ziply Fiber.
In addition to the purchase price, BCE will also be taking on around $2 billion in net debt as part of the transaction. This acquisition is expected to close in the second half of 2025, pending customary closing conditions and regulatory approvals. By acquiring Ziply Fiber, BCE will be expanding its fibre footprint to the United States, gaining access to approximately 1.3 million fibre locations. This strategic move aligns with BCE’s focus on investing in fibre assets with significant growth potential.
BCE’s chief financial officer, Curtis Millen, highlighted the company’s shift from a sports asset to a fibre asset, emphasizing the growth opportunities presented by investing in the latter. BCE’s CEO, Mirko Bibic, described the U.S. market as a natural expansion opportunity for the company and highlighted the strategic importance of this acquisition in solidifying Bell’s position as a major fibre network and internet service provider in North America.
Ziply Fiber, based in Kirkland, Washington, operates in the U.S. Pacific Northwest, offering fibre internet services in states such as Washington, Oregon, Idaho, and Montana. Following the completion of the deal, Ziply Fiber will continue to operate as a separate business unit with its headquarters remaining in Kirkland. The acquisition of Ziply Fiber is seen as a crucial step in BCE’s growth strategy, leveraging the expertise and scale of one of North America’s leading fibre operators.
Despite the strategic significance of this acquisition, BCE’s share price experienced a decline following the announcement of the deal. Analysts have expressed mixed opinions about the transaction, with some raising concerns about the high costs associated with operating fibre networks in the U.S. market. While some view this move as a positive step towards long-term telecom growth for BCE, others question the potential synergies and impacts on the Canadian telecom sector.
In comparison to Verizon’s recent acquisition of Frontier Communications in a $20 billion deal, analysts are evaluating the strategic rationale behind BCE’s acquisition of Ziply Fiber. The telecommunications landscape is evolving rapidly, with companies seeking to enhance their network capabilities and expand their market reach. BCE’s decision to enter the U.S. fibre market reflects its commitment to pursuing growth opportunities and strengthening its position as a key player in the telecommunications industry.
