Access Communications Inc., a small company in Plymouth that played a significant but unheralded role in building broadband infrastructure for Twin Cities schools and government agencies, said Monday it was being acquired by Zayo Group, a Colorado firm that has been rolling up regional network providers into a national service.
The $40 million cash deal represents a long-delayed payoff for Access co-founders Randy Herman and Arlyn Birkholz, who started the business in 1997 at the height of the first Internet boom and, unlike many infrastructure firms of that era, found a way to survive a yearslong slowdown that resulted from overbuilding of fiber lines.
With just 23 employees, a head count that has remained virtually the same since they started, Herman and Birkholz focused for years on school districts, then gradually expanded to government agencies, businesses and cellphone carriers in the metropolitan region — laying more than 1,200 miles of optical fiber that has been leased by their customers.
About three months ago, after completing the latest expansion to their network, the two partners began looking for a buyer.
“The network became very large for us,” said Herman, the company’s CEO. “It became important to find someone who could manage and continue to grow it.”
Zayo, based in Boulder, Colo., since 2006 has used investment capital to make nearly two dozen acquisitions of regional operators of fiber networks around the country. With those purchases, it has built a national broadband network that’s an alternative to the copper wire-based infrastructure of traditional telecom firms.
Access and Zayo provide what’s known as “dark fiber” network service. Dark fiber is unused capacity that customers lease and place their own multiplexing equipment on to set the speed of the connection. With Access, Zayo will more than double the size of its dark fiber network in the Twin Cities area.
Zayo first entered Minnesota with the 2007 purchase of Onvoy, a Minneapolis company that in the 1980s helped small telephone companies throughout the state develop their first Internet connections and services. Zayo added to its Minnesota business in 2010 with the purchase of American Fiber Systems, a Rochester, N.Y., company that had a network in the market.
Herman said he and Birkholz, who has been president of Access, will stay through the close of the deal and then explore new ventures. Access’ employees will remain after the acquisition, he said, and continue to build networks and provide related services. Herman said Access will add several new services from Zayo, including voice over IP and higher speed connections to the Internet backbone, for its customers.