GTT Communications Inc (NYSE:GTT) will acquire the managed business service division from MegaPath. This service provides wide-area networking, internet access and other managed services to over 500 clients across the globe. GTT will pay $144.8 million cash along with $7.5 million in the company’s common stock. The managed services generated $124 million in revenue with an EBITDA of about $20 million. The deal is expected to close by April of 2015.
Tops Growth List
The company also announced it has been ranked in the most recent Deloitte’s Technology Fast 500 listing. This identifies them as one of the fastest growing technology companies in the US. The list is very prestigious and identifies the most innovative and technologically advanced up-and-coming companies. They noted strong growth and an innovative portfolio as the reasons for putting GTT on the list. The list is populated using the percentage of revenue growth from 2009 to 2013. In 2009 GTT Communications Inc (NYSE:GTT) grew at a rate of 145%. In its most recent quarter, GTT had raised its annual income to over $197 million. Their next goal is to top $400 million in yearly sales.
They recently announced a publicsale of the company’s stock at a price of $12.75per share. The sale is expected to generate $41.6 million for GTT Communications Inc (NYSE:GTT). The underwriters have also been deemed a 30-day option to buy as much as 525,000 more shares at that price. GTT is planning to use the proceeds as working capital and also general corporate purposes. Jefferies LLC and William Blair & co will be the joint book makers in the deal.GTT maintains a worldwide Tier 1 IP network that connects any location in the world and utilizing any application on its cloud service. They offer cloud networking solutions that allow their clients to embrace the cloud. They use a simple, yet agile method that is fast.
The stock moved quickly on the acquisition news but failed to hold above support. Volume was strong but it continues to trade below its 50-day moving average and until it does it will most likely continue to trade in the current range.