The Telx Group has filed for an initial public offering in which it hopes to raise up to $100 million. The company said it intends to use the money to accelerate the growth of its business through expanding and upgrading its data centers, and possibly acquisitions.
The colocation and interconnection services provider has grown its data center footprint since being acquired by private equity firm GI Partners in 2006, and now operates 15 facilities with more than 480,000 square feet of data center space. Telx also owns the 56 Marietta carrier hotel in Atlanta, one of the primary connection hubs in that market.
Telx is not profitable, but its revenue has grown from $50.8 million in 2007 to $98.3 million in 2009, the company said in its IPO filing with the Securities and Exchange Commission. The company lost $9.9 million in 2009, an improvement from losses of $31.3 million in 2008 and $37.2 million in 2007.
Its 763 customers include AT&T, HP, Yahoo, CBS and NASA, along with servioce providers like SoftLayer, Level 3, iland Internet, Cogent and Qwest. Those customers have a total of 28,272 physical interconnections through Telx facilities, the company said.
Telx has steadily expanded its colocation footprint over the past two years, adding space in Dallas, New York, New Jersey, San Francisco and Chicago.
Telx says the IPO funds would allow it to invest in increasing the network densities in its data centers to support additional customer growth. It also indicated that it may seek to grow through acquisitions.
"We believe our industry has favorable consolidation characteristics and we expect this trend to continue in the foreseeable future," the company said in its SEC filing. "Given the limited availability of interconnection and colocation facilities within tier-1 markets, acquisitions of existing businesses may provide a cost-effective method of increasing network densities, expanding our customer base and broadening our geographic footprint. We intend to pursue attractive opportunities as they arise."
Goldman, Sachs & Co and Deutsche Bank Securities are leading the underwriters. The company is expected to trade on the Nasdaq under the symbol "TELX."