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GI Partners looks to raise more equity for Florida broadband firm

GI Partners is working with Lazard on raising equity for fiber-optics based triple-play provider Blue Stream Fiber, said sources familiar with the matter.

The capital raise process, which one source said is in an early stage, comes three years after GI closed on a deal to buy the company from investment firm Twin Point Capital – a process that Lazard also helped run.

GI Partners took a majority stake with the firm’s CEO Joe Canavan holding onto a small interest in the Florida-based company.

The asset manager is going to retain its controlling stake in the company while it looks to onboard a minority equity investor, said one of the sources.

GI Partners declined to comment. Blue Stream and Lazard did not return messages seeking comment.

In the time GI has presided as a shareholder of the company, Blue Stream has acquired neighboring ITS Fiber, expanded into new markets and successfully gotten underwritten for a USD 465m asset-backed security financing.

The company was generating north of USD 20m in EBTIDA when the asset manager initially bought the company. That figure has grown since then, one of the sources said.

In addition to its fiber offering largely in the Port Saint Lucie area, the company still operates DSL west of that location and cable in the Coral Springs and Fort Lauderdale parts of Florida, industry data provider Broadbandnow shows.

Blue Stream remains in need of capital to fuel its growth, two of the sources said.

An ideal potential suitor would be an institutional investor because such long-term capital could complement the company’s business model and timeline for transitioning greenfield projects into stabilized networks with reliable cash flows, according to two of the sources.

Blue Stream mostly targets condo associations and homeowners associations as potential customers, locking them into longer-term contracts relative to the month-to-month agreements traditional fiber-to-the-home providers offer.

Based in Coral Springs, Blue Stream provides internet, television and phone service to southern Florida. Originally called Advanced Cable Communications, the company was launched in 1978 and has offices in Weston and Coral Springs. It was acquired by Twin Point Capital and rebranded as Blue Stream in August 2016.