American network operator GTT Communications has agreed to acquire British network and infrastructure specialist Interoute for €1.9 billion ($2.3 billion) in cash.

Interoute operates one of Europe’s largest cloud and networking platforms, with 72,000 km (44,739 miles) of lit fiber in the ground and 15 data centers across the UK, Belgium France, Germany, the Netherlands, Spain and Switzerland.

The deal will considerably expand GTT’s reach in Europe, add new edge and hosted services and enhance the network with new SD-WAN capabilities.

A star is born

Interoute Netherlands
Interoute data center in the Netherlands – Interoute

GTT Communications (formerly Global Telecom & Technology) is headquartered in McLean, Virginia. The company operates a Tier 1 network and provides IP transit and MPLS transport services to enterprise, government, and carrier customers in over 100 countries.

London-based Interoute owns 15 data centers outright and offers its services through another 17 virtual data centers and 51 third-party colocation facilities, linked by its own low-latency network.

Following the acquisition, the combined network will include more than 400 points of presence, spanning 24 metro areas and interconnecting 126 cities across 29 countries, making GTT one of the largest carrier network operators in the world.

In order to finance the deal, GTT received committed debt financing from a group of financial institutions and $250 million in committed equity financing from The Spruce House Partnership and Acacia Partners.

“The acquisition of Interoute represents a major milestone in delivering on our purpose of connecting people, across organizations and around the world,” said Rick Calder, GTT president and CEO.

“This combination creates a disruptive market leader with substantial scale, unique network assets and award-winning product capabilities to fulfill our clients’ growing demand for distributed cloud networking in Europe, the U.S. and across the globe.”

“This is an exciting next chapter for Interoute, GTT, our customers and our team,” added Gareth Williams, Interoute CEO. “The combined assets and strengths of our two companies create a powerful portfolio of high-capacity, low-latency connectivity, and innovative cloud and edge infrastructure services to support our customers in the global digital economy.

GTT said integration of the Interoute business will complete within three to four quarters after the deal closes – something that’s expected to happen in three to six months, subject to customary regulatory approvals.