Google Fiber (GFiber) is being sold to private equity firm Stonepeak, which will merge it with Astound Broadband to create a larger, independent fiber provider. Alphabet, Google's parent company, will retain only a minority stake in the combined entity.
The deal, expected to close in late 2024 pending approvals, is intended to provide GFiber with capital and focus to accelerate its growth. The merged company will be led by GFiber's existing executive team, combining its metropolitan networks with Astound's established national infrastructure.
The main topics covered are the corporate sale and merger, the new ownership structure, and the strategic rationale for combining the two companies' fiber networks.
Google Fiber, now officially called GFiber, is being sold to private equity firm Stonepeak and will be combined with cable-and-fiber firm Astound Broadband to create a larger Internet service provider.
Google owner Alphabet announced Wednesday that it will keep only a minority stake in the fiber ISP that launched with grand ambitions in 2012 but scaled back its expansion plans in 2016. Alphabet and Astound owner Stonepeak announced “an agreement to combine GFiber with Astound Broadband, creating a leading independent fiber provider,” with the merged company to be “majority owned by Stonepeak, an investment firm specializing in infrastructure and real assets.”
The deal is subject to regulatory approvals and other closing conditions, with an expected closing date in Q4 of this year. The sale price was not disclosed. The deal will help GFiber take “a major step toward its goal of operational and financial independence” and obtain the “external capital and strategic focus needed to accelerate its next phase of growth,” the announcement said.
It’s unclear whether the combined firm will be called GFiber, Astound, or something else. “The combined business will be led by the existing GFiber executive team, utilizing their expertise in high-speed fiber innovation to manage the combined network footprint,” the announcement said. “The combination of GFiber’s high-growth metropolitan networks with Astound’s established infrastructure, team and capabilities creates a highly complementary, national network platform.”
Alphabet President and Chief Investment Officer Ruth Porat said the merger will let GFiber reach more parts of the country “while continuing to provide their award winning customer experience.” The announcement said that Alphabet maintaining a minority stake “reflect[s] its confidence in GFiber’s growth opportunity and leadership.” Stonepeak Senior Managing Director Andrew Thomas said that Stonepeak “look[s] forward to supporting the company with Alphabet as a co-investor.”
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