20161213Transfer of Control.pdf

Mo1·gan Lewis
Catherine Wang
Brett P. Ferenchak
[e-mail]
[e-mail]
December 12, 2016
VIA EMAIL & OVERNIGHT COURIER
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
Boise, ID 83702
[e-mail]
ORIGINAL
R~CE IVED
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Re: Notification Regarding the Proposed Transfer of Indirect Control of Electric
Lightwave, LLC, Eschelon Telecom, Inc., and Integra Telecom of Idaho, Inc.
to Zayo Group, LLC
Dear Ms. Jewell:
By this letter, Electric Lightwave Parent, Inc. ("EL Parent''); Electric Lightwave, LLC ("Electric
Lightwave''); Eschelon Telecom, Inc. ("Eschelon''); Integra Telecom of Idaho, Inc. ("Integra''),
(Electric Lightwave, Eschelon, Integra collectively, the "Licensees''); and Zayo Group, LLC
("Zayo'') (collectively, the "Parties'') notify the Commission of the proposed transfer of indirect
control of Licensees to Zayo. Since Commission action is not required for the Transaction (as
defined below), the Parties submit this letter for informational purposes.
Description of the Parties
A. Zayo Group, LLC
Zayo is a Delaware limited liability company with principal offices at 1805 29th Street, Boulder,
Colorado 80301. Zayo is a wholly owned subsidiary of Zayo Group Holdings, Inc. (''Holdings''),
a publicly traded Delaware corporation (NYSE: ZAYO). Holdings has no majority owner.
Zayo is a provider of bandwidth infrastructure and network neutral colocation and
interconnection services over regional and metropolitan fiber networks. These services enable
customers to manage, operate, and scale their telecommunications and data networks. Such
customers consist primarily of wireless service providers, national and regional
telecommunications carriers and other communications service providers, media and content
companies, schools, hospitals, governments, banks and other bandwidth-intensive enterprises.
Morgan, Lewis & Bockius LLP
2020 K Street, NW
Washington, DC 20006-1806
United States
0 +1.202.373.6000
G +1.202.379.6001
Jean Jewell, Secretary
December 12, 2016
Page 2
In Idaho, Zayo has registered as an Other Telecommunications Provider and holds
Certification as Wholesale Telecommunication Provider pursuant to Order No. 32765 issued in
Docket No. ZAY-T-12-01. Zayo is also authorized by the FCC to provide interstate and
international telecommunications services.
B. EL Parent and Licensees
Electric Lightwave Parent, Inc. is a privately held Delaware corporation with principal offices at
18110 SE 34th Street; Building One, Suite 100; Vancouver, Washington 98683. EL Parent
functions as a holding company and does not provide telecommunications in its own right.
Through its wholly owned subsidiaries, EL Parent owns and operates a number of
telecommunications providers that operate primarily in Arizona, California, Colorado, Idaho,
Minnesota, Montana, Nevada, North Dakota, Oregon, Utah, and Washington. EL Parent's
subsidiaries provide a broad range of communication and networking services primarily to
business customers, wholesale carriers, web content providers, government organizations,
and educational institutions. These services include but are not limited to facilities-based,
integrated, resold and facilities-based local, resold long distance, Internet, broadband
transport and data services. EL Parent operates an extensive network with access to over
12,500 fiber miles and over 3,200 fiber-lit buildings.
In Idaho, Licensees hold the following authorizations:
1. Electric Lightwave, LLC, a Delaware limited liability company, is authorized to
provide basic local exchange telecommunications services pursuant to the First Amended
Certificate No. 344 granted in Case No. ELI-T-04-2.
2. Eschelon Telecom, Inc., a Delaware corporation, is authorized to provide local
exchange and interexchange services pursuant to Certificate No. 384 granted by Order No.
28599 issued in Case No. GNR-T-00-23.
3. Integra Telecom of Idaho, Inc., an Oregon corporation, is authorized to
provide local exchange and interexchange telecommunications services pursuant to Certificate
No. 386 granted by Order No. 28585 issued in Case No. GNR-T-00-15.
Contacts
For the purposes of this filing, contacts are as follows:
Jean Jewell, Secretary
December 12, 2016
Page 3
Catherine Wang
Brett P. Ferenchak
Morgan, Lewis & Beckius LLP
2020 K Street, N.W.
Washington, DC 20006-1806
202-373-6000 (tel)
202-373-6001 (fax)
[e-mail]
brett. [e-mail]
With a copy to:
Gregg Strumberger, General Counsel
Zayo Canada
1805 29th St., Suite 2050
Boulder, CO 80301
[e-mail]
[e-mail]
and:
Douglas Denney
Vice President, Costs & Policy
Electric Lightwave
18110 SE 34th St
Building One, Suite 100
Vancouver, WA 98683
[e-mail]
Description of the Transaction
Pursuant to the Agreement and Plan of Merger, dated as of November 29, 2016, by and
among Zayo, ZELMS, Inc. (a direct, wholly owned subsidiary of Zayo created for purposes of
the merger) ("Merger Sub''), EL Parent, and Fortis Advisors LLC, as the Equityholder
Representative (the "Agreement''), Zayo will acquire all of the outstanding equity interests in
EL Parent (the "Transaction''). Specifically, Merger Sub will merge with and into EL Parent,
whereupon the separate existence of Merger Sub will cease and EL Parent will be the
surviving corporation. As a result, EL Parent will become a direct, wholly owned subsidiary of
Zayo. Licensees will remain indirect subsidiaries of EL Parent and, therefore, Licensees will
become indirect subsidiaries of Zayo. Diagrams depicting the pre-and post-Transaction
corporate ownership structures are appended hereto as Exhibit A.
The Transaction described herein will serve the public interest. As part of Zayo, Licensees will
continue to provide high-quality telecommunications services to consumers (under the same
rates, terms and condition of services as currently provided) while gaining access to the
additional resources and operational expertise of Zayo. Licensees will also benefit by being
able to offer services to multi-location business and enterprise customers across a larger
footprint in combination with Zayo. The network of EL Parent and its subsidiaries, including
Licensees, complements Zayo's network and the acquisition will increase Zayo's existing fiber
footprint. The Transaction also will provide Licensees with access to greater financial
resources that will allow them to become more effective competitors to larger incumbent
telecommunications providers. In essence, the Transaction will make Licensees and Zayo
stronger competitors and thereby benefit consumers.
Jean Jewell, Secretary
December 12, 2016
Page 4
* * * *
An original and seven (7) copies of this notification letter are enclosed. Please date-stamp
and return the extra copy in the envelope provided. This letter has also been filed via e-mail.
Should you have any questions, please do not hesitate to contact us.
Respectfully submitted,
B~-Pr~
Catherine Wang
Brett P. Ferenchak
Counsel for Zayo Group, LLC
EXHIBIT A
Diagrams of the Pre-and Post-Transaction Corporate Ownership Structures
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Current Corporate Ownership Structure of EL Parent
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Unless otherwise indicated all ownership percentages are 100%.
Exhibit A -Page 1
Post-Transaction Corporate Ownership Structure of EL Parent and Zaya
• The entities listed herein only include Zayo and its
subsidiaries that (1) hold authorization to provide intrastate,
interstate or international telecommunications services or (2)
are in the chain of ownership of those entities. The chart
excludes subsidiaries and affiliates of Zayo that do not hold
authorization to provide telecommunications services in the
United States.
Unless otherwise indicated all ownership percentages are 100%.
: Holdings Shareholders : L-----------~------------~
Zayo Group Holdings, Inc.
("Holdings")
Zayo Group, LLC
("Zayo")
Electric Lightwave
Parent, Inc.
(" EL Parent")
I
I
,------------l------------,
: See Page 1 for
Subsidiaries of EL Parent :
L------------------------~
Exhibit A -Page 2
STATE OF WASHINGTON
COUNTY OF CLARK
§
§
§
VERIFICATION
I, Douglas K. Denney, am Vice President, Costs & Policy of Electric Lightwave
Holdings, Inc.; that I am authorized to make this Verification on behalf of the Electric Lightwave
Parent, Inc. and its subsidiaries ( collectively, the "Company"); that the foregoing filing was
prepared under my direction and supervision; and that the contents with respect to the Company
are true and correct to the best of my knowledge, information, and belief.
las K. Denney
Vi e President, Costs & Policy
Electric Lightwave Holdings, In .
Sworn and subscribed before me this2qih day of No~ , 2016.
~fuOtA~
My commission expires ___.(_~-1-::0-,'--+-) cf""'----'O..._l.,_~-"'-'--JENNIFER JOHNSON
NOTARY PUBLIC
STATE OF WASHINGTON
COMMISSION EXPIRES
JUNE 30, 2018
ST A TE OF COLORADO
COUNTY OF BOULDER
s s
§
§
VERIFICATION
I, Gregg Strumberger, am General Counsel Zayo Group, LLC (the "Company"); that I am
authorized to make this Verification on behalf of the Company; that the foregoing filing was
prepared under my direction and supervision ; and that the contents are true and correct to the
best of my knowledge, information, and belief.
-regg Strumberger
General Counsel
Zayo Group, LLC
Sworn and subscribed before me thi~O ~ ofl/J;~ , 2016.
C-~~ NotaryPic
My commission expires ~ CX~o?Cl,f"
AMYE ROWE
NOTARY PUBLIC
STATE OF COLORADO
NOTARY 10 # 20104020272
MY COMMISSION EXPIRES AUGUST 24. 2018