GTT announcement agreement to purchase Interoute
GTT Communications, Inc. announced a definitive purchase agreement to acquire Interoute, operator of one of Europe’s largest independent fiber networks, for $2.3 billion in cash.
GTT benefits from acquiring Interoute in that it is able to expand GTT’s Tier 1 global IP network with one of Europe’s most extensive fiber footprints. The network includes 400 points of presence, encompassing 24 metro areas and interconnecting 126 cities across 29 countries, according to the company. GTT said the extended capabilities through the acquisition ought to better position itself as a leader in software-defined wide area networking (SD-WAN) as well.
“The acquisition of Interoute represents a major milestone in delivering on our purpose of connecting people, across organizations and around the world,” said Rick Calder, GTT president and CEO, in a statement. “This combination creates a disruptive market leader with substantial scale, unique network assets and award-winning product capabilities to fulfill our clients’ growing demand for distributed cloud networking in Europe, the U.S. and across the globe. Following our successful, proven acquisition model, we expect to complete this integration within three to four quarters post-close and achieve a post-synergy multiple of seven to eight times Adjusted EBITDA or better on a pro forma basis.”
GTT noted the acquisition will expand its client multinational clientele with over 1,000 strategic enterprise and carrier clients mostly based in Europe. It will also enhance GTT’s cloud connectivity platform by adding 15 data centers, 17 virtual data centers and 51 colocation facilities. Interoute has received support from its shareholders, including the Sandoz Family Foundation, Aleph Capital and Crestview Partners.
“This is an exciting next chapter for Interoute, GTT, our customers and our team,” said Gareth Williams, Interoute CEO. “The combined assets and strengths of our two companies create a powerful portfolio of high-capacity, low-latency connectivity, and innovative cloud and edge infrastructure services to support our customers in the global digital economy.”
This marks GTT’s second acquisition this year. In January, the company acquired Custom Connect, an Amsterdam-headquartered provider of high-speed network connectivity. GTT said its acquisition of Custom Connect would also extend the reach of its global Tier 1 IP backbone with additional points of presence in Europe and the Middle East. GTT said it expects the transaction with Interoute to close in three to six months.
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