This article first appeared on GuruFocus.
Alphabet (GOOGL, GOOG) will combine its fiber internet business with Astound Broadband to create a new independent fiber provider. The majority stake will be owned by Stonepeak, while Alphabet will retain a minority stake in the venture.
The transaction reduces Alphabet’s direct ownership of GFiber, a unit previously known as Google Fiber, while bringing in outside capital to help scale the network. The merged entity will be run by GFiber CEO Dinni Jain. Financial terms of the deal were not disclosed.
Stonepeak acquired Astound in November 2020 for $8.1 billion and has been building out its broadband infrastructure portfolio since. Executives said the combination would create a complementary national platform capable of serving millions of customers as demand for high-speed connectivity rises across the U.S., and that the deal will help GFiber accelerate expansion toward operational and financial independence. GFiber was launched in 2010 but never achieved the national scale Alphabet originally envisioned.
