US-based cloud networking provider GTT Communications has acquired European network operator Interoute for $2.3bn in cash. The deal expands GTT's Tier 1 global IP network with Interoute's 72,000 km fibre footprint in Europe, which includes over 400 points of presence, spans 24 metro areas and interconnects 126 cities across 29 countries.
The acquisition also strengthens GTT's capabilities in SD-WAN, adding 15 data centres, 17 virtual data centres and 51 colocation facilities.
"The acquisition of Interoute represents a major milestone in delivering on our purpose of connecting people, across organisations and around the world," said Rick Calder, GTT president and CEO.
"This combination brings substantial scale, network assets and product capabilities to fulfill our clients' growing demand for distributed cloud networking in Europe, the US and across the globe.
"Following our 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."
Interoute CEO Gareth Williams added: "The combined assets and strengths of our two companies create a powerful portfolio of high-capacity, low-latency connectivity, cloud and edge infrastructure services to support our customers in the global digital economy."
Prior to the deal being done Interoute received strong support from its shareholders - the Sandoz Family Foundation, Aleph Capital and Crestview Partners - in its strategy of building and consolidating the European fibre, cloud and connectivity markets.