Private equity firm I Squared Capital has acquired the infrastructure division of GTT Communications for $2.15 billion. The deal, originally announced in October 2020, was completed in September 2021. The acquired business has been rebranded as EXA Infrastructure, led by new CEO Martijn Blanken.
GTT, as long expected, will now file for bankruptcy protection in a bid to reorganize its debt-laden business. The company has vowed to maintain its SD-WAN, Internet, security, and voice services during the bankruptcy process.
This is technology M&A Deal number 587 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.
EXA Infrastructure: Fiber Networks, Data Centers, Colocation and More
In this deal, I Squared Capital essentially gains "selected network and data center assets accumulated from several GTT acquisitions, including Interoute, Hibernia, and KPN International," the seller says. Those assets, now known as EXA Infrastructure, include:
- A 103,000 route kilometer fiber network with over 400 points of presence, spanning 31 metro areas and interconnecting 103 cities across Europe and North America.
- Three transatlantic subsea cables, including GTT Express, the lowest latency route between Europe and North America.
- Fourteen Tier 3 data centers and over 100 colocation facilities.
- Various telecom and data infrastructure solutions for "marquee clients."
Under terms of the deal, I Squared agreed to pay $2.02 at closing and up to $130 million in deferred payments based on certain financial results. Also, roughly 420 employees have shifted from GTT to EXA. The newly branded EXA Infrastructure, headquartered in London, United Kingdom, has 28 offices in 18 countries across Europe.
New EXA Infrastructure CEO Martijn Blanken was previously group managing director of Telstra Enterprise and CEO of Telstra Global, which under his leadership transformed into the leading service provider in Asia Pacific, he biography asserts.
Infrastructure and Data Center Acquisition: Executive Perspectives
In a prepared statement about the deal, I Squared Capital Managing Partner Gautam Bhandari said:
“The differentiated fiber and data center assets acquired through this purchase from GTT are a valuable addition to our global digital infrastructure investments. We are excited about the opportunity to invest and build on this rich set of digital infrastructure capabilities to serve the increasing market demand for high performance networks. We welcome the talented team from GTT to EXA Infrastructure, the newly named independent operating company.”
Added GTT Chief Revenue Officer and Interim CEO Ernie Ortega:
“The divestment of the highly differentiated infrastructure division assets will ensure greater focus on network investment and development of high-speed infrastructure services under the more specialized ownership of this experienced investor. The deal enables GTT to reinforce its capex light business model as well as its cloud networking focus and will benefit both enterprise and infrastructure clients alike.”
Concluded newly hired EXA CEO Martijn Blanken:
“The creation of EXA, the way that we will serve our customers and our commitment to continual investment in our business is all down to one word: focus. We will have a relentless focus on the data-centre-to-data centre infrastructure services we provide, enabling our customers to provide the most compelling experiences to their clients and end-users, We are determined to become the undisputed leader in the digital infrastructure industry in the European, trans-Atlantic and North American market. In order to achieve that ambition, we will make material investments to expand our network footprint, in close collaboration with our customers, to meet the ever-growing need to carry data around key routes in the region."
Private equity owner I Squared Capital typically invests in energy, utilities, digital infrastructure, transport and social infrastructure in the Americas, Europe and Asia. The firm has offices in Hong Kong, London, Miami, New Delhi, New York and Singapore.