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Telecommunications Sector Rife with M&A Activity in 2018

Merger and acquisition (M&A) activity is picking up this year in the telecommunications sector thanks to a robust domestic and global economy, innovations in technology, investment in emerging markets and stronger corporate balance sheets. 

2017 saw considerable consolidation with CenturyLink and Level 3 joining forces; Windstream buying Broadview Networks and EarthLink; Frontier finalizing the acquisition of Verizon assets in Florida, Texas and California; Zayo Group acquiring Electric Lightwave; Verizon purchasing XO Communications, Straight Path Communications and WOW’s fiber assets in Chicago; GTT Communications acquiring Giglinx, Perseus, Global Capacity and Transbeam; Crown Castle International agreeing to acquire Lightower and Wilcon; and Uniti Group getting Hunt Telecom and Southern Light Fiber, to name a few. 

That’s a lot of M&A activity for one year! The top 13 fiber miles buyers for 2017 can be found here.

M&A activity in the tech and telecom sector is forecast to rise significantly across all regions, according to a recent analysis by multinational law firm Baker McKenzie, with North America topping the list of transactions totaling $234 billion. 

Among the largest and most high-profile deal came last month between T-Mobile and Sprint. The deal combines the third and fourth-largest wireless providers in the nation in a bid to compete head on with the top two wireless providers: Verizon and AT&T. The race to deliver 5G connectivity to consumers and businesses was one of the key drivers for cementing the deal, according to the companies. 

Meanwhile, in the media sector, tension is mounting in the talks to merge CBS Corp. and Viacom, and the bitterness could derail or at least delay the proposed recombination. But, some argue the deal will eventually get done somehow, some way. In fact, it's been reported that Shari Redstone, media heiress whose family controls CBS and Viacom, has offered CBS CEO Leslie Moonves to drop her demands for Viacom CEO Bob Bakish to be his No. 2 following a merger, as long as Bakish sits on the combined company's board.

If 2017 was any indication of M&A activity in the telecom sector, 2018 is shaping up to be one of the most active in recent memory.