Interoute shareholders to invest $175m in GTT once merger is completed
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Interoute shareholders to invest $175m in GTT once merger is completed

GTT Communications has announced that a group of investors being led by Aleph Capital Partners and Crestview Partners will invest $175 million in common stock in the company.

The investment will come once GTT closes its $2.3 billion takeover of Interoute, a deal which was announced last month.

Both Aleph and Crestview, who are significant shareholders in European cable provider Interoute, said they will invest a portion of the proceeds they will receive from GTT’s acquisition back into the combined company, helping reduce the acquisitive telco’s debt issuance for the deal.

“Aleph and Crestview’s investment is a strong vote of confidence in our vision to create a disruptive market leader with substantial scale, unique network assets and award-winning product capabilities to fulfill our clients’ growing demand for cloud networking services in Europe, the U.S. and across the globe,” said Rick Calder, GTT president and CEO.

Aleph is a London-based investment firm founded in 2013 by the former head of principal investment at Goldman Sachs Hugues Lepic, who is CEO. He said: “"We are excited to become shareholders of GTT in this new phase of its growth and development. 

“The strength of GTT and Interoute’s combined assets and capabilities creates a compelling opportunity to build a player with significant scale and international presence and drive further industry consolidation.”

The Interoute acquisition is the latest in a string of deals struck by GTT and will significantly boost its scale. It includes 400 points of presence, spanning 24 metro areas and interconnecting 126 cities across 29 countries. In addition, the deal will strengthen GTT’s leadership position in software-defined wide area networking (SD-WAN), It will add 15 data centres, 17 virtual data centres and 51 colocation facilities, enhancing GTT’s cloud connectivity platform.

Other deals it has struck this year include the acquisition of Canadian managed networking and services provider Accelerated Connections, and Amsterdam-based high-speed connectivity provider Customer Connect. This follows several deals struck in 2017, the largest of which was the acquisition of Hibernia Networks.

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