Ridgemont Equity Partners has agreed to take a majority stake in Kansas City, Missouri-based Unite Private Networks, which provides high bandwidth, fiber-based communications networks.
The Charlotte, North Carolina-based firm did not disclose financial details of the transaction. Ridgemont spun out of Bank of America in August, and is investing with seed capital from the bank. The firm declined to disclose how much dry powder it has for deals.
“[This] is an industry we know reasonably well. This would be our third investment in the sector. We have witnessed strong growth in the other two companies in which we invested in the sector,” according to George Morgan, a partner at Ridgemont.
“These companies have continued to be able to grow straight through the downturn in the economy,” Morgan said. “Growth slowed a bit in ‘08 and ‘09 and picked back up in 2010. Because of the long-term nature of their customer contracts, relationships, the dependencies the customers develop on these networks, we found this industry in general is pretty resilient to economic downturn.”
Ridgemont’s other two investments in the fiber optics sector are Fibertech Networks, which builds and operates fiber optic networks in mid-sized cities in Easter and Central US, and Veroxity Technology Partners, which develops and manages fiber optic networks in New England.
The firm exited Rochester, New York-based Fibertech earlier in August, selling the company to Court Square Capital Partners.
Ridgemont is managing roughly $1.5 billion of the bank’s legacy private equity assets, and plans to raise third-party capital. Ridgemont, formerly called Banc of America Capital Investors, expects to do about six transactions averaging roughly $50 million a piece with the capital it has from the bank, according to Travis Hain, partner with the firm.