GTT Communications has purchased Perseus, a microwave-based network used by financial trading companies, for $37.5 million.
The purchase price includes the assumption of approximately $3 million in capital leases. GTT expects that the purchase price will reflect a multiple of post-synergy adjusted EBITDA of 5.0x or lower, with integration and cost synergies to be achieved within two quarters.
The sale, which was first revealed in a Bloomberg report, was confirmed by Perseus CEO Jock Percy. GTT has not responded to FierceTelecom’s request for comment, and spokesman Randy Slack declined to comment to Bloomberg.
Percy told Bloomberg that Perseus had been pursuing a sale of the company since the end of last year. In 2015, Goldman Sachs bought a $20.5 million stake in the company.
“It was a competitive process,” Percy said. “GTT as a financial service provider has become a very significant powerhouse.”
A key element that companies like Perseus bring to the financial trading table is their ability to reduce network latency, which can inhibit traders from making timely deals. While some trading firms like Jump Trading build their own proprietary networks, others work with Perseus and other microwave and fiber-based providers.
In addition to financial services, Perseus also provides global connectivity to the media and digital commerce segments.
GTT is no novice in the financial industry. The service provider has been serving this industry segment for over a decade and further cemented its position by acquiring Hibernia and thereby establishing its own fiber-based facilities presence with a set of owned and leased dark fiber assets including five owned subsea cable and eight landing stations.
For the financial markets, Hibernia Networks owns and operates transatlantic cables including the recently opened ultralow-latency Express cable. Hibernia has also built a series of U.S. and European terrestrial networks by purchasing dark fiber indefeasible rights of use leases from other service providers.
In order to better capitalize on extending its service set across the growing network facilities it gained via its acquisition of Hibernia, GTT recently created three new divisions: enterprise, carrier and EMEA. The carrier and EMEA leaders will be able to potentially target customers with its optical transport service that have higher bandwidth needs along the Hibernia cabling routes.
Purchasing Perseus should be no great surprise. At the time it purchased Hibernia, Rick Calder, CEO of GTT, said it had a "funnel" of more than 50 M&A possibilities it was considering.
Some of GTT’s other notable acquisitions include Telnes, MegaPath's managed services business and One Source Networks, three providers that immediately deepened GTT's domestic and international network reach. The Perseus deal would fall in line with GTT’s ongoing M&A pattern.
This article was updated on June 20 to reflect the correct purchase price of 37.5 million.