Bell Canada (BCE), along with Public Sector Pension Investment Board (PSP Investments), has announced a fiber JV that aims to ramp up the development of fiber infrastructure through Ziply Fiber to underserved markets in the US.
The announcement of the JV comes around six months after Bell agreed to acquire US fiber company Ziply Fiber, in a deal expected to be worth as much as C$7 billion (US$5bn).
The formation of the Network FiberCo will target last-mile fiber deployment outside of Ziply Fiber's incumbent service areas, enabling Ziply Fiber to potentially reach up to eight million total fiber passings.
As part of the agreement, PSP Investments has agreed to a potential commitment in excess of US$1.5 billion.
"Today's announcement represents a pivotal step in BCE's fiber growth strategy. By bringing PSP Investments' financial resources and acumen to Ziply Fiber, we are creating a scalable, capital-efficient platform to fund US fiber footprint expansion," said Mirko Bibic, president and CEO, BCE and Bell Canada.
"This strategic partnership will improve free cash flow generation and strengthen EBITDA accretion over the long term, reinforcing our commitment to delivering long-term value for shareholders while maintaining financial discipline."
BCE will own a 49 percent equity stake in Network FiberCo through Ziply Fiber, while PSP Investments will own 51 percent through its High Inflation Correlated Infrastructure Portfolio (HICI).
The JV aims to develop approximately one million fiber passings in Ziply Fiber's existing states and will target the development of up to five million additional passings.
On top of this, Network FiberCo will have its own non-recourse debt financing, which is anticipated to be the majority of its capital over time.
BCE and PSP Investments will proportionately fund the equity required by Network FiberCo to support fiber expansion.
BCE added that the fiber broadband market provides a key growth opportunity for the company.
"This strategic partnership aligns perfectly with Ziply Fiber's mission to improve connectivity in the communities we serve. We're combining our operational expertise with BCE's scale and PSP Investments' financial strength to accelerate fiber deployment, enhance customer experiences, and drive sustainable growth," added Harold Zeitz, CEO, Ziply Fiber.
The company also provided an update on its planned Ziply Fiber acquisition last week, noting that it expects the deal to close in the second half of 2025, subject to customary closing conditions.
BCE will assume 100 percent ownership of Ziply Fiber's existing operations. Ziply Fiber is a local Internet service provider (ISP) that offers fiber Internet in Washington, Oregon, Idaho, and Montana to more than 1.3 million fiber locations.
Once the transaction closes, Bell is set to expand its fiber footprint to more than 12 million locations across North America by the end of 2028, meaning it will be the third-largest fiber Internet provider in the region.
