UK-based data centre provider Telecity Group has inked a non-binding agreement to merge with InterXion Holding, a New York-listed provider of cloud and carrier-neutral data centre co-location services, in a US$2.2bn all-share deal.
The deal value…
UK-based data centre provider Telecity Group has inked a non-binding agreement to merge with InterXion Holding, a New York-listed provider of cloud and carrier-neutral data centre co-location services, in a US$2.2bn all-share deal.
The deal value represents a 15% premium to InterXion’s share price at close on 9 February, InterXion said in a statement.
Further to the merger, which would enable Telecity to expand its cloud-based footprint, Telecity shareholders would own approximately 55% of the combined entity, while InterXion shareholders would hold the remaining 45%.
The companies expect to sign a binding agreement by 4 March 2015 and to complete the transaction by the second half of 2015, subject to shareholders’ approval and regulatory clearance.
The primary listing for the combined group would be in London, with a possible New York listing for Telecity’s existing ADR programme.
“The additional scale and scope of the combined operations will give customers an expanded product set, more robust connectivity choices, better landing points for access to European consumers and expanded gateways to new markets in Africa, Asia and Eastern Europe,” InterXion said.
Telecity expects total synergies from the merger to amount to approximately £600m (US$914m).
In addition, the company forecasts substantial incremental benefits from technology, capital productivity and commercial, tax and other financial synergies, as well as enhanced access to the capital markets and the opportunity of a lower cost of capital.
Telecity chairman John Hughes will be appointed as chairman of the merged group, while InterXion CEO David Ruberg will be the new entity’s CEO for a period of 12 months following completion of the transaction.
Commenting on the deal, Hughes said: “We think that the combination of TelecityGroup and InterXion would represent an extremely compelling combination for all stakeholders of both companies. The transaction would truly transform both organisations and allow them to deliver a superior proposition to the joint customer base.”
Perella Weinberg Partners is advising InterXion on the deal.
Telecity posted £348.7m in revenues in 2014 and £163.7m in EBITDA, while InterXion reported a €340.6m turnover with a €146.4m EBITDA.
