By Jeremy Nobile, Crain’s Cleveland Business
Everstream has announced closing $342.5 million in debt financing that it will use to accelerate previously disclosed growth and expansion plans establishing its service in new markets, which means laying lots of new fiber.
The Cleveland-based company, a business-only fiber internet service provider, said the financing will enable its goal of branching into five new networks during 2020. One of those new markets, Chicago, came online in February. Other new markets included in the expansion plan include Dayton; Fort Wayne, Ind.; Louisville, Ky.; and St. Louis.
The financing was arranged among nine banks, including Webster Bank (the lead arranger), CoBank, Regions Financial Corp., Fifth Third Bank and TD Bank.
Per a news release from the company: Everstream is bringing high-capacity fiber connectivity to select markets in the Midwest. The company is on track to grow to more than 15,000 miles of fiber with more than 3,000 on-net locations in 12 markets throughout the Midwest by the end of 2020. As Everstream’s network grows, its customers benefit from more diverse network options and direct connection to data centers and locations in the expanded region.
Everstream had previously said it was expecting to invest at least $250 million this year alone in achieving those goals.
In a follow-up with Crain’s, Everstream president and CEO Brett Lindsey said the state of the world under the COVID-19 pandemic hasn’t affected the company’s growth prospects. Last year, the business branched into Columbus, Indianapolis and Milwaukee.
“To date, the impact to the company’s growth and expansion plans has been minimal,” Lindsey said. “Everstream is considered an essential business, and team members are still out in the field. Everstream has implemented health and safety protocols in response to COVID-19 for those customers who have installations scheduled. While some customers have delayed their installations, orders have not been canceled.”
Everstream typically hires a staff of about 20 in each new market it adds. As of the Chicago expansion, the company reported a staff of 220 with 50 open positions available.
Fiber-based internet is apparently quite appealing to investors and lenders right now. In an unrelated enterprise to Everstream, Snip — a Cleveland-based fiber internet provider exclusively serving apartments that is also led by Lindsey — in March closed a $7.75 million Series B funding round to enable that provider’s expansions to Columbus and Milwaukee.