Virginia-headquartered GTT Communications, announced this week that it will part with $2.3 billion in cash to acquire fiber and cloud networks provider, Interoute.
With UK-based Interoute already operating 15 data centers, 17 virtual facilities and 51 third-party colocation facilities, the deal will give GTT bragging rights as one of the world’s largest carrier network operators.
Whilst regulatory approvals are still needed and the deal not likely to close for 3-6 months, this didn’t stop the share price spiking at an all-time high on Monday.
“This combination creates a disruptive market leader with substantial scale, unique network assets and award-winning product capabilities to fulfil our clients’ growing demand for distributed cloud networking in Europe, the US and across the globe,” said GTT Chief Executive and President, Rick Calder.
“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,” Rick added.
GTT’s acquisition will add 72,000 km of fiber and significantly boost its suite of cloud networking services with additional infrastructure, edge and hosted services.
More than 1,000 mostly-European strategic enterprise and carrier clients will now form part of GTT’s client base, expanding its presence to 126 cities across 29 countries.
“This is an exciting next chapter for Interoute, GTT, our customers and our team,” said Interoute CEO, Gareth Williams.
“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,” Gareth added.
Less than three years ago, Interoute doubled the size of its enterprise ICT services business with the acquisition of networking operator, Easynet.