This news release contains forward-looking statements. For a description of the related risk factors and assumptions, please see the section entitled “Caution Regarding Forward-Looking Statements” later in this news release.
BCE Inc. (TSX: BCE) (NYSE: BCE), Canada’s largest communications company1, and Public Sector Pension Investment Board (PSP Investments), one of Canada’s largest pension investors, today announced the formation of Network FiberCo, a long-term strategic partnership to accelerate the development of fiber infrastructure through Ziply Fiber, in underserved markets in the United States.
As a premier wholesale network provider, Network FiberCo will be focused on last-mile fibre deployment outside of Ziply Fiber’s incumbent service areas, enabling Ziply Fiber to potentially reach up to 8 million total fibre passings.
PSP Investments has agreed to a potential commitment in excess of US$1.5 billion.
Leadership Perspectives
“Today’s announcement represents a pivotal step in BCE’s fibre growth strategy. By bringing PSP Investments’ financial resources and acumen to Ziply Fiber, we are creating a scalable, capital-efficient platform to fund U.S. fibre footprint expansion. 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.”
– Mirko Bibic, President and CEO, BCE and Bell Canada
“PSP Investments is pleased to partner with BCE, a long-standing Canadian champion of innovation and connectivity, to support the development of fibre infrastructure in Ziply Fiber’s target markets, which benefit from secular tailwinds. This commitment by PSP Investments will generate inflation linked and downside protected returns, which will contribute to fulfilling our mission to support the retirement of people who protect and serve Canada. PSP Investments has been an investor in Ziply Fiber, and this partnership, leveraging our global infrastructure experience, aligns perfectly with our strategy and strengthens our diversified portfolio.”
– Deborah Orida, President and Chief Executive Officer, PSP Investments
“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 fibre deployment, enhance customer experiences, and drive sustainable growth.”
– Harold Zeitz, CEO, Ziply Fiber
Key Highlights of the Strategic Partnership
- Ownership Structure: BCE through Ziply Fiber will hold a 49% equity stake in Network FiberCo, with PSP Investments owning 51% through its High Inflation Correlated Infrastructure Portfolio (HICI), contingent on closing of BCE’s acquisition of Ziply Fiber.
- Fibre Expansion Goals: Network FiberCo will develop approximately 1 million fibre passings in Ziply Fiber’s existing states and will target development of up to 5 million additional passings, which will enable Ziply Fiber to reach up to 8 million total fibre passings.
- Optimized Capital Efficiency: 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 equity required by Network FiberCo to support fibre expansion.
- Complementary Skill Set: The operational capabilities of BCE combined with PSP Investments’ significant infrastructure investing experience will enable Network FiberCo to capture the substantial growth anticipated and deliver the target fibre passing for Ziply Fiber.
Strategic Rationale
The U.S. fibre broadband market represents a transformative growth opportunity, with penetration rates well below Canada’s and efficient construction costs enabling large-scale deployment. Network FiberCo’s scalable platform supports both organic fibre expansion and potential acquisitions while enhancing returns through its capital-efficient structure.
Driving Sustainable Growth
BCE’s proposed acquisition of Ziply Fiber marks a strategic entry into the U.S. broadband market, securing a leading management team and operating platform with significant long-term growth potential. This disciplined reinvestment unlocks value through an expanded and diversified fibre footprint while benefiting from economies of scale.
Ziply Fiber has achieved significant fibre broadband subscriber growth and adjusted EBITDA growth in 2024, validating the strategic rationale and demonstrating its ability to generate meaningful and sustainable long-term cash flow.
Ownership and Operations
Upon, and contingent on, close of the previously announced acquisition of Ziply Fiber, BCE will assume 100% ownership of Ziply Fiber’s existing operations. Ziply Fiber, as a BCE subsidiary, will continue to operate its existing network and execute its in-footprint fibre-to-the-home build strategy. Ziply Fiber will become a long-term partner to Network FiberCo, jointly owned by PSP Investments and BCE, as the exclusive Internet service provider to locations passed by Network FiberCo.
Additional Transaction Details
The transaction is expected to close in the second half of 2025, subject to customary closing conditions and the closing of BCE’s previously announced acquisition of Ziply Fiber.
Analyst Call Details
BCE will hold a conference call with the financial community at 8:00 AM ET today, May 8, 2025 to discuss its Q1 2025 results and speak to the Network FiberCo strategic partnership. Media are welcome to participate on a listen-only basis. To participate, please dial toll-free 1-844-933-2401 or 647-724-5455. A replay will be available until midnight on June 8, 2025 by dialing 1-877-454-9859 or 647-483-1416 and entering passcode 7485404. A live audio webcast of the conference call will be available on BCE’s website at BCE Q1-2025 conference call.
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