Cervalis Raises Expansion Financing
September 13th, 2010 By: Rich Miller
Managed hosting provider Cervalis has received a preferred equity investment from Goldman Sachs, and will use the proceeds to accelerate its data center expansion, the company said Friday. The additional capital will be used to expand Cervalis’ footprint in both existing locations and new markets.
“The partnership with Goldman Sachs provides us with growth capital to accelerate our strategic expansion plans,” said Michael Boccardi, CEO of Cervalis. “Additionally as a company, going forward we will have the benefit of Goldman’s broad industry experience in this sector to help guide us in fulfilling our long-term objectives for all our shareholders.”
Last year Cervalis signed a long-term lease with Russo Development for a 148,191 square foot building in Totowa, N.J., which will house more than 50,000 square feet of data center space for Cervalis clients. The data center is Cervalis’ first facility in New Jersey, and expands the company’s footprint to more than 280,000 square feet of space, with additional facilities in Wappingers Falls, N.Y. and Stamford, Ct.
Last summer Cervalis arranged a $48 million credit line. In searching for additional financing, Cervalis saw an opportunity with Goldman Sachs.
“We realized during our investment process Goldman Sachs’ extensive experience in this sector made them an exceptional fit with Cervalis,” said Lawrence F. DeGeorge, Chairman of Cervalis. “As Chairman and the company’s majority shareholder, I am delighted we have them as a partner. The entire Cervalis team is pleased to work with them to grow our business.”
DH Capital, LLC, an investment banking firm serving the Internet infrastructure and communications sectors, acted as exclusive financial advisor to Cervalis on the transaction.