Thursday, May 21, 2015

Wave Broadband Plans $130 Million Expansion

Kirkland, Wash.-based Wave Broadband has raised $130 million to expand its gigabit Internet access services in the Puget Sound region of Washington, possibly to an additional 10,000 locations in downtown Seattle, but also possibly including other areas as well.

If one assumes $2,000 cost per new location, that would entail spending about $20 million. If Wave adds another 1,500 route miles of fiber, at a cost of $20,000 per mile, that implies an investment of $30 million.

Those two elements would account for about $50 million. That suggests Wave will expand in yet other areas.

In the past, Wave has grown by acquisition, so it would be reasonable to assume some of the new capital will be used to acquire assets.

Wave’s current business is 85 percent residential and 15 percent commercial. But that ratio could change, given the targeted move to downtown Seattle. The company says it is seeing commercial business growing 25 percent annually.

The company said it has annual revenue of more than $350 million.

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