In one of the first major data center acquisition of 2008, DH Capital served as the exclusive financial advisor to managed hosting and colocation provider Data393 (data393.com) in its sale to Managed Data Holdings (manageddataholdings.com).

DH Capital helped the Denver, Colorado-based Data393 find the right partner in what the company was willing to describe as an "eight figure deal," enabling Data393 to continue its rapid growth and expand its data center capacity.

"[Data393's] board decided to explore various ways to bring money into the business," says Paul Stapleton, managing director of DH Capital. "We were retained to help them explore those options and put the right capital in place. You can sell a piece of the business or you can sell the whole business; Data393 elected to sell the whole business."

Data393 provides a range of managed IT infrastructure services, including colocation, dedicated servers and managed infrastructure, all from its 75,000 square foot SAS 70 Type II certified facility in the Denver Tech Center.

The acquisition has enabled the company to accelerate its 10,000 square foot expansion, bringing the total to about 30,000 square feet. The expansion will include higher density power and cooling, parallel redundant generator capacity, static dissipating raised flooring and a combination of cabinet and cage colocation space.

"[Data393] is a strong brand and there's a strong thesis out there that these are local businesses," says Stapleton. "There's no need to mess them up by changing too much. There aren't a lot of efficiencies in changing names and cutting expenses. These businesses were bought for their growth potential and not for the expense reduction available."

Under the leadership of newly appointed general manager Brett Jones, Managed Data Holdings says it will operate the business under the Data393 brand name.

Managed Data Holdings also operates Intelenet Communications (intelenet.net) facility in Irvine, California, which is also SAS70 Type II compliant.

Together with Data393, Managed Data Holdings now offers a combined high density, raised-floor capacity of more than 60,000 square feet, Tier 1 carrier connectivity and a full suite of managed hosting and managed services.

The Data393 acquisition is just one of many significant deals that DH Capital will advise on this year, says Stapleton, promising that there will be several other major transactions announced throughout 2008.

"It was a good, straight-down-the middle transaction and indicative of how healthy this industry has become," says Stapleton.