Aleph Capital Partners has sold its stake in Interoute Communications, a leading European fibre and cloud connectivity service provider, to GTT Communications, generating a superior return on its original investment which was completed less than 3 years ago.

Transaction Overview

Aleph Capital Partners, Crestview Partners and the Sandoz Family Foundation have sold Interoute, one of Europe’s largest fibre networks and cloud connectivity service providers, to GTT Communications, for a total consideration of €1.9bn.

• GTT Communications is a US based provider of cloud networking services to multinational clients. The company is listed on the New York Stock exchange
• Sale price implies an EV/EBITDA multiple of c.11x

Aleph and Crestview acquired a 30% stake in the company in April 2015, joining Interoute’s majority shareholder, the Sandoz Family Foundation, as shareholders in the company.

This is the first exit for Aleph Capital since the firm was founded in 2013.

Supporting Interoute’s Growth

Aleph and Crestview’s original investment thesis was focused on using Interoute as a platform for consolidation in the European fibre, cloud and connectivity markets to create a player with significant scale and international presence.

Aleph and Crestview added value by supporting Interoute’s consolidation strategy.

• The investment of Aleph and Crestview in Interoute triggered the acquisition of European operator Easynet for £402m, which:
• Close to doubled the scale of the company’s operations
• Generated material synergies
• Gave the company access to the debt capital markets

Since Aleph and Crestview’s initial investment in 2015, Interoute’s revenues have increased from €424m to €718m (21% CAGR) and Adjusted EBITDA from €93m to €165m (23% CAGR).

The acquisition of Interoute by GTT is the next step towards the consolidation of cloud and fibre connectivity markets in Europe.

About Aleph Capital

Aleph Capital was founded in 2013 by Hugues Lepic, former Head of Goldman Sachs’ European Private Equity investing business (PIA or the Principal Investment Area). The firm’s investment strategy is focused on providing flexible capital solutions to ambitious companies where its contribution unlocks growth and value creation. Aleph Capital is a long-term investor, aiming to partner with talented management teams and support them in the implementation of their growth strategy. Aleph is focused on making investments in three specific industry verticals: Energy/Natural Resources, Financial Services and TMT.