Posted By Rich Miller On June 1, 2010 @ 4:48 pm In Savvis | No Comments
The deal activity continues in the data center industry. Today Savvis  said it will acquire Canadian managed IT and colocation provider Fusepoint Inc.  for $124.5 million in cash. Fusepoint, a portfolio company of M/C Venture Partners , operates three data centers in Toronto, Vancouver and Montreal and has more than 330 customers.
The acquisition provides additional international expansion for Savvis (SVVS), which hinted  in February that it was “selectively exploring expansion opportunities” that would expand its data center footprint into new markets. Fusepoint’s data centers have a total of more than 40,000 sellable square feet of space, with Toronto the largest at 28,000 sellable square feet.
Customer Interest in Canada
“The acquisition of Fusepoint is a step toward one of our most important goals to expand our geographic presence around the world,” said Jim Ousley, Savvis chairman and chief executive officer. “Our largest customers have been asking us to expand into Canada, and the acquisition of Fusepoint allows us to do so in a seamless and efficient manner.
“Our best-in-class product set and strong vertical market focus meshes well with Fusepoint’s fast growth and deep penetration of Canadian enterprises,” Ousley continued. “Fusepoint has a great track record and extends Savvis’ reach into the highly promising Canadian hosting market including Toronto, the financial center of Canada.”
Fusepoint had $47.4 million in annualized revenue for the first quarter of 2010. Adjusted EBITDA for the first quarter was $3.0 million, or $12.0 million on an annualized basis. Since 2006, Fusepoint has posted an overall revenue compound annual growth rate (CAGR) of 18 percent and adjusted EBITDA growing at a CAGR of 83 percent. The company has been adjusted EBITDA positive since 2005 and has generated net income and free cash flow since 2008. Fusepoint reported $41.7 million in revenue in 2009.
“We’re pleased to become a part of the Savvis family, as we believe our offerings are very complementary and highly synergistic,” said George Kerns, Fusepoint chief executive officer. “By folding our footprint into Savvis’ global operations, we’ll be able to better serve our customers, by providing them with a broader range of services and access to a global footprint with leading-edge technology.”
Expansion Continues for Savvis
Savvis, a managed hosting and cloud computing specialist, has been in active expansion mode lately with plans to build additional data center space in northern Virginia, northern New Jersey, London and Chicago markets. The company estimates that it will end about $55 million on its current data center projects.
The acquisition of Fusepoint is expected to close early this summer. Savvis plans to finance the acquisition from available cash and an increase in its existing revolving credit line, led by Wells Fargo Capital Finance, LLC, part of Wells Fargo & Company. GCA Savvian Advisors, LLC served as exclusive financial advisor and Arnold & Porter LLP served as legal advisor to Savvis.On the Fusepoint side, Signal Hill Capital Group LLC served as exclusive financial advisor, Edwards Angell Palmer & Dodge LLP served as legal advisor and Olsler, Hoskin & Harcourt LLP served as special Canadian counsel.
Article printed from Data Center Knowledge: http://www.datacenterknowledge.com
URL to article: http://www.datacenterknowledge.com/archives/2010/06/01/savvis-buys-canadian-provider-fusepoint/
URLs in this post:
 Savvis: http://www.savvis.net
 Fusepoint Inc.: http://fusepoint.com/
 M/C Venture Partners: http://www.mcventurepartners.com/
 hinted: http://www.datacenterknowledge.com/archives/2010/02/03/savvis-ready-to-build-and-may-go-shopping/
 Rich Miller: http://www.datacenterknowledge.com/archives/author/richm/
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