GTT Communications, a cloud networking provider to multinational clients, has acquired Telnes Broadband, an Internet and managed services provider (MSP). The $18 million buyout will allow GTT to accelerate its channel sales while pushing deeper into several vertical markets, the two companies say.
Telnes, founded in 2003, provides high-availability managed network services and cloud communications. The company's revenue for 2015 was roughly $17 million, with adjusted EBITDA of about $1 million. GTT expects to integrate Telnes into its business within two quarters, while delivering a "post-synergy purchase price multiple of less than five times Adjusted EBITDA.” (In other words, GTT did not pay an 18X multiple on EBITDA to buy Telnes.)
Although Telnes is based in Everett, Wash., this isn't a regional managed services play. GTT's EtherCloud provides "private, public and hybrid network solutions to any location in the world and with any application in the cloud." Now, those services will be available to Telnes channel partners and customers. Telnes CEO Jason Ness says the deal will empower agents with a large portfolio of international services.
This is the latest in a growing list of MSP-oriented acquisitions that surfaced this week. Additional deals included:
- Avalon Document Services and Digits merged to promote managed services, cyber security and eDiscovery in the legal vertical.
- Aldridge acquired Arterian and PacketDrivers for a Seattle-area MSP push and a Microsoft cloud practice build-out.
- TUC Managed IT Solutions and CareWorx merged to pursue managed services and the senior care vertical.
We will update this article if/when more details about the GTT-Telnes deal becomes available.