CDN Provider Highwinds Secures $205m, Recapitalizes

CDN provider Highwinds secured $205 million in new debt financing. It's one of the largest single transactions ever closed by a CDN provider.

Content Delivery Network provider Highwinds has secured $205 million in new debt financing. This is a lot of dough, at least some of which will likely go towards its data center/colo provider spend as it expands its global content delivery platform. The financing has resulted in the recapitalization of the business, and positions Highwinds for aggressive growth, through both organic and M&A investment opportunities.

This is big money, among the largest single transactions ever closed by a CDN provider.

Highwinds’ growth plans include increasing investment across all functional areas of the business, including sales, business development, product, marketing and operations, as well as executing on strategic M&A opportunities.

The financing is by Cerberus Business Finance and Goldman Sachs BDC, an investment fund managed by Goldman Sachs Asset Management. It includes participation from the company’s existing equity sponsor, General Catalyst Partners, and the company’s management team.

“Highwinds has tremendous financial strength, with positive cash flow, a strong balance sheet and sustained profitability. They also have proven technological innovation, an impressive customer roster, a brilliant, thoroughly vested executive team, and demonstrated success in supporting the shift to online digital entertainment, which is now a global cultural phenomenon,” said Kevin Cross, managing director, lending, for Cerberus. “These factors make Highwinds a great investment for us, and we are pleased to be able to fund their next stage of growth.”

Highwinds’ network comprises dozens of data centers spanning five continents, massive peering infrastructure, egress capacity in excess of 4 Tbps. It content delivery and cloud services are used by gaming, advertising, software, and media & entertainment companies for delivery of assets to millions of global users. The company launched Highwinds Cloud Storage (HCS) earlier this year.

Founder and CEO Steve Miller has now orchestrated over $420 million in total new equity and debt financing since 2006. “Highwinds continues to provide excellent service and support for its CDN customers, and this, together with management’s focus, has allowed us to grow profitably year-over-year,” said Miller. “I am excited to align ourselves with partners who will help finance our vision and execute our mission.”

“Our lofty ambitions have become a reality time and again because we’ve never wavered in our commitment to customers, and because we’ve had great financial partners along the way," said Miller. "We’ve made a monumental move here to secure financing that will further fuel our growth.”

 

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