Exclusive: Data center company Telx explores $2 billion sale - sources

Reuters News
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Posted: Apr 27, 2015 8:24 PM

By Liana B. Baker and Greg Roumeliotis

(Reuters) - Telx Group Inc, a private equity-owned provider of data centers and network solutions to companies, is exploring a sale that could value it at around $2 billion, including debt, according to people familiar with the matter.

Telx's owners, ABRY Partners LLC and Berkshire Partners LLC, have interviewed investment banks in recent weeks to appoint financial advisers that will help run an auction for the company, the people said on Monday.

The sources asked not to be identified because the deliberations are confidential. Telx and ABRY Partners representatives did not immediately respond to requests for comment. Berkshire Partners declined to comment.

U.S. businesses' burgeoning demand for data and video is fueling a revival in fiber optic services and data centers. New York-based Telx manages 1.3 million square feet of data center space and more than 50,000 network connections.

The company owns 20 data centers, including three major ones in New York City. Its customers range from small businesses that only need half of a cabinet in data centers to global companies requiring a full-floor lease.

Telx is just the latest data center company to hit the auction block. Zayo Group Holdings <ZAYO.O> bought data center company Latysis in February for $675 million, while AT&T has been pursuing a sale of its data centers worth $2 billion.

Earlier on Monday, Lightower Fiber Networks, a fiber company that is also owned by Berkshire Partners and ABRY partners, bought Fibertech Networks from Court Square Networks for $1.9 billion.

(Reporting by Liana B. Baker and Greg Roumeliotis; Editing by Ken Wills)