Cyxtera Technologies Inc. is reportedly considering a sale, less than a year after going public.
Bloomberg reports the colocation company, which merged last year with blank-check firm Starboard Value Acquisition Corp. (SVAC), is exploring strategic options including a sale, according to people with knowledge of the matter.
The colocation provider is reportedly working with advisers as it mulls alternatives. A Cyxtera representative didn’t respond to the publication’s request for comment.
Special-purpose acquisition companies (SPACs) are ‘blank check’ shell companies that list on a stock exchange and then acquire or merge with an operating private company. This route to the stock market is often quicker and involves fewer steps than a traditional IPO.
The SVAC SPAC, founded by the Starboard Value hedge fund, IPOed in September 2020 and raised $360 million. It was created with the intention of merging with a company in one of the technology, healthcare, consumer, industrial, hospitality, or entertainment sectors.
Cyxtera announced it was combining with the Nasdaq-listed SVAC in February 2021 in a $3.1 billion merger; the deal completed in the summer of 2021.
The colo firm operates more than 60 facilities totaling 245MW across 22 markets globally; it owns two data center facilities in Colorado and Virginia and leases the rest of its portfolio.
For its Q4 2021 results, announced last month, Cyxtera posted total revenues of $178.4 million – an increase of $5.7m. Net Losses for the quarter ran to $65.6 million, while Adjusted EBITDA was $48 million. Full-year total revenue increased by $13.2 m to $703.7 million. The company posted a Net Loss for the year of $257.9 million; Adjusted EBITDA was $224.4 million.
The company is predicting revenues of $730-760 million for 2022 and Adjusted EBITDA of $235-253 million. It is predicting expansion capital in the region of $102-127 million, up from $67m in 2021. In its SEC filings, the company noted that it does not expect to generate positive net income until at least 2025.
Despite only going public last year, any potential sale or merger would be the latest data center mega-deal in recent memory. QTS, CoreSite, and CyrusOne were all acquired and taken private in multi-billion dollar deals last year by Blackstone, American Tower, and KKR/GIP respectively.