GTT Inks Deal to Acquire Hibernia Networks for $590 Million
Leading cloud networking provider GTT communications has agreed to acquire submarine cable provider Hibernia Networks for $590 million in cash and stock.
Under the terms of the agreement, $515 million will be paid by GTT in cash, and about 3.3 million shares of GTT common stock, which is valued at $75 million, will be issued to the sellers at closing. The deal, expected to close by the end of first quarter of 2017, is set to scale GTT’s IP network and customer reach.
In the Cloud and Now Undersea
Hibernia Networks provides global, high-speed network connectivity solutions to more than 100 markets in over 25 countries around the world. The company also owns terrestrial and subsea fiber assets including Hibernia Express, the lowest latency transatlantic cable system. Some of the industry segments they cater to include telecom service providers, web-centric, financial markets, and media and entertainment.
With its acquisition of Hibernia Networks, GTT will be able to enhance its Tier 1 IP network with a set of owned and leased dark fiber assets, which include five owned subsea cable and eight landing stations. GTT will also be able to expand its cloud networking portfolio.
Rick Calder, GTT president and CEO, expressed his positive outlook for the acquisition, stating, “This acquisition accelerates GTT’s growth strategy by expanding our portfolio of cloud networking services, significantly increasing the scope and power of our global network, and growing our multinational client base.”
“Hibernia Networks has a demonstrated track record of growth and brings unique, strategic network assets featuring high-bandwidth, low latency connectivity. We are very excited to welcome Hibernia Networks’ clients and talented team members to GTT. Following our successful, proven acquisition template, we expect to complete integration within two to three quarters post-close, and to achieve a post-synergy multiple of seven times Adjusted EBITDA or better on a pro forma basis,” Calder added.
What GTT Stands to Gain
As GTT brings Hibernia into its fold, a number of opportunities may present themselves, which may help GTT fully achieve its mission of redefining enterprise communications. Some of the benefits that could result from this strategic combination are:
- A boost in BTT’s physical network assets
- An expansion in GTT’s cloud networking portfolio. Aside from wide area networking, internet, managed services and voice services, GTT adds optical and low latency transport, video, and CDN services into its portfolio.
- A growing client base. GTT can now sell its services to a wide range of client base previously covered by Hibernia.
- A world-class video transport platform. With the acquisition, GTT now manages Hibernia’s broadcast video transport and CDN business which serves content rights holders, broadcasters, cable companies and OTT providers.
- A boost in GTT’s financial profile.
Bjarni Thorvardarson, Hibernia Networks’ chief executive officer, had this to say about the merging of their companies:
“GTT’s acquisition of Hibernia Networks provides great benefit to the entirety of our customer base as well as our two organizations. GTT gains world class global fiber assets, including ultra-low latency routes between key financial markets, as well as optical, low latency and content services, and exceptional employees with a proven track record of network and commercial leadership, and exemplary customer service. Hibernia Networks clients around the world will benefit from the expansive reach of GTT’s Tier 1 IP network, the broader portfolio of products and services, improved scale, and the company’s expertise in delivering cloud networking solutions and managed services to multinational clients.”
For more information about GTT and their broader portfolio of products and services, please visit their website.
About GTT
GTT is committed to redefining global communications by offering a diverse suite of cloud networking services. Their portfolio includes wide-area networking, Internet, managed services and voice services. With its Tier 1 IP network, GTT seeks to help customers connect to any application in the cloud securely and effectively.
About Hibernia Networks
Hibernia Networks provides fast and resilient communication and connectivity solutions that businesses need in today’s digital age. They own and operate a global network that serves more than 100 markets in over 25 countries. Their robust suite of solutions includes optical, ethernet & IP, content, and low latency services. Hibernia Networks also owns Hibernia Express, a state-of-the-art transatlantic cable system that offers the lowest latency connections between major commercial and financial centers in North America, Europe and beyond.
