PEER 1 Hosting
(TSX:PIX) will acquire all UK-based hosting company NetBenefit
for $38.5 million, the companies said today. The deal gives PEER 1 a stronger presence in the UK managed hosting market. NetBenefit’s business and servers will be migrated into PEER 1′s new 57,800 square foot flagship UK data center in Portsmouth.
“This transaction vaults us into a clear leadership position in the UK managed hosting market and further underscores our commitment to the dynamic and growing EMEA region,” said Fabio Banducci, President and CEO of PEER 1. “NetBenefit shares our passion and reputation for quality and service and we are thrilled to welcome its employees, customers and other stakeholders to the PEER 1 Hosting family. We believe our combined operating scale will allow us to market our shared leading-edge solutions to an even broader customer base across the EMEA region.”
Founded in 1995, NetBenefit is a division of London-based Group NBT Limited and is one of the UK’s longest-operating and most experienced providers of managed hosting services to small and medium sized businesses. NetBenefit has approximately 50 employees providing nearly 700 customers with hosting solutions and professional 24 x 7 x 365 technical support, provisioned and deployed principally from two leased datacenters located in the Greater London area.
For the fiscal year ending June 30, 2012, NetBenefit is forecast to generate approximately US$12.5 million in revenue and US$3.8 million in EBITDA. Following the acquisition, NetBenefit will provide managed hosting services back to Group NBT under a three year contract valued at approximately GBP1.5 million (US$2.3 million) per year.
PEER 1 also said it has lined upa $150 million credit line with NBF, which includes a $100 million term loan facility and a $50 million committed revolving credit facility. In addition, the credit agreement will also include an un-committed accordion feature that will provide PEER 1 with up to a further US $25 million, bringing the total potential credit available under the new credit facilities to $175 million. The company intends to use the funds to repay existing credit facilities, capital expenditures, acquisitions, and for working capital and general corporate purposes.
“Securing increased credit facilities on favourable terms ensures we retain access to non-dilutive capital, providing us with the financial flexibility to act on further opportunities in the wake of this transaction,” said Gary Sherlock, Executive Vice President and Chief Financial Officer of PEER 1. “We continue to evaluate an array of initiatives to grow both organically and through acquisition in multiple geographies, domestic and international.”
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 Rich Miller: http://www.datacenterknowledge.com/archives/author/richm/
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