EXA Infrastructure rises from ashes after GTT fiber sale
GTT Communications finally completed its long-gestated plan to sell off pan-European fiber assets in order to enforce its "capex light" strategy.
GTT indicated in 2019 that it wanted to offload some of the pan-European fiber assets, subsea transatlantic fiber and data center infrastructure it bought as part of its Interoute, Hibernia Networks and KPN International acquisitions.
In October 2020, the company signed a definitive purchase agreement to sell its infrastructure division to New York-based I Squared Capital, an independent global infrastructure investment firm, for $2.15 billion.
Today, GTT and I Squared Capital completed the acquisition and the investment firm immediately announced the creation of a new unit called EXA Infrastructure. The new business consists of a pan-European, North American and subsea fiber network and data center assets and associated infrastructure services provided to customers. Headquartered in London, EXA has 28 offices in 18 countries across Europe. It said the name EXA is inspired by the exabyte, “the unit of measurement for computers of the future.”
For GTT, the completion of the transaction marks a new era as it moves away from infrastructure ownership and maintenance. Ernie Ortega, the CEO of GTT, said the company will now focus on "serving the global enterprise market with a full array of cloud networking and managed solutions that include SD-WAN, security, internet, voice and other vital telecommunication services that enable digital business."
For its part, EXA Infrastructure now owns a 103,000 route kilometer fibre network with over 400 points of presence, spanning 31 metro areas and interconnecting 103 cities across Europe and North America. Its assets also include three transatlantic subsea cables, including GTT Express, fourteen Tier 3 data centers and over 100 colocation facilities. Around 420 employees will move to EXA from GTT.
Gautam Bhandari, managing partner at I Squared Capital, said the GTT purchase represents the firm’s second carve-out of fiber and data center assets from a telecoms company to an independent, carrier-neutral infrastructure platform.
"Combined with our recent transactions for Ezee Fiber in Texas and KIO Networks in Mexico, I Squared Capital has committed over $3 billion to digital infrastructure with over 120,000 route kilometres of fibre across the Americas, Europe and Asia," Bhandari said. In 2017, Hong Kong's Hutchison group sold off its fiber and longhaul unit, Hutchison Global Communications (HGC), to I Squared Capital. The business included a global fiber network, a Hong Kong retail broadband network and several cross-border links into China.
EXA also announced the appointment of Martijn Blanken as its new CEO. Blanken previously held various executive positions within Australian telco Telstra, including CEO of Telstra Global, and most recently served as senior advisor to I Squared Capital.
Indeed, Blanken led negotiations on behalf of I Squared Capital when it teamed with Telstra in talks to buy HKT's international unit PCCW Global, according to reports. The current status of those talks is unclear.
- GTT sells fiber to I Squared Capital for $2.15B
- Telstra, I Squared in PCCW Global tilt – report
- Suitors finally emerge for GTT's infrastructure division
- GTT CEO Calder sets his exit
- Hutchison Offloads Fixed-Line Unit for $1.9B
— Anne Morris, contributing editor, special to Light Reading