Global digital infrastructure company Colt has acquired Lumen’s Europe, Middle East and Africa (EMEA) business for $1.8 billion. Lumen’s strategic collaboration with Colt would allow it to continue providing services across EMEA to international enterprise clients under the conditions of the deal.
The acquisition would price represent a strong ~11x multiple of Lumen EMEA’s estimated 2021 adjusted EBITDA.
“We are continuing to execute on portfolio optimization at Lumen, creating additional value for our shareholders by monetizing non-strategic assets at accretive multiples,” said Jeff Storey, President and CEO at Lumen. “This transaction would enhance our focus so we can invest more efficiently in our most strategic opportunities – our key Enterprise and Quantum Fiber initiatives – and partner with regional leaders like Colt in Europe and Cirion in Latin America to continue serving our multinational enterprise customers.”
In conjunction with the transaction, Lumen is being advised financially by Morgan Stanley & Co. LLC and legally by Bryan Cave Leighton Paisner LLP. In relation to the deal, Colt is being advised financially by Evercore Group L.L.C. and legally by Baker & McKenzie LLP.
“This transaction would mark the next chapter in Colt’s exciting story of global growth and world-class innovation,” said Keri Gilder, CEO at Colt Technology Services. “We’re deeply committed to building extraordinary connections for our people, customers, and partners across our digital infrastructure. This acquisition would strengthen and extend these connections across existing and new geographies, helping us to accelerate growth and bring the power of the digital universe closer to our customers.”
Benefits to Colt would include the following:
- Colt’s network being expanded to include more nations, cities, and data centers throughout Europe, providing companies with enhanced fiber access
- Access to the whole spectrum of product solutions for a variety of Enterprise, Hyperscaler, Government, and Wholesale clients is made available to Colt
- Colt is in a position to take advantage of expanding terrestrial and subsea reach to handle increasing enterprise and international IP traffic in EMEA
Founded in 1992, Colt has expanded from its roots in the City of London to more than 60 offices worldwide. With more than 1000 data centers, 51 Metropolitan Area Networks, and more than 31,000 buildings spread throughout the major commercial hubs in Europe, Asia, and North America, the robust Colt IQ Network currently connects 222 cities and 32 countries.
With approximately 400,000 route fiber miles being deployed while serving clients in more than 60 countries, Lumen provides network, edge cloud, security, communication, and collaboration solutions on a global scale.
Strategic Partnership Lumen and Colt
The majority of Lumen’s EMEA staff would transition to Colt once the deal is completed. Lumen will be able to continue providing a seamless experience for its global clients with demands in EMEA thanks to the strategic partnership Colt and Lumen will develop. Colt will be able to continue supporting EMEA-based clients that have service needs outside of EMEA thanks to the agreement.
“Lumen has a strong interest in Colt’s success, and we expect to remain a close business partner and key customer,” added Jeff Storey. “Colt’s strong reputation and customer focus make them the ideal partner to serve the needs of our customers, and we expect to remain Colt’s partner of choice for their customers’ needs in North America.”
“Colt and Lumen share values, and a drive to deliver outstanding customer experience,” added Keri Gilder. “This combination is powered by amazing people and incredible infrastructure and is inspired by technology’s ability to change the way we live and work.”
Following receipt of all regulatory clearances in the U.S. and other countries where Colt conducts business, as well as the fulfillment of other customary conditions, Lumen and Colt anticipate that the deal will close as early as late 2023.