(WEB HOST INDUSTRY REVIEW) — Cloud infrastructure and hosted IT solutions provider Savvis (www.savvis.net) announced on Tuesday it will acquire managed IT and colocation provider Fusepoint (www.fusepoint.com) from M/C Venture Partners for $124.5 million in cash.
For the first quarter of 2010, Fusepoint’s annualized revenue was $47.4 million.
Fusepoint operates three data centers in Canada including Toronto, Vancouver and Montreal.
With more than 330 marquee customers under its belt, the company is well-positioned in the Canadian hosting market, which is still in its early stages of growth.
Since 2006, Fusepoint has shown an overall revenue compound annual growth rate of 18 percent and has generated net income and free cash flow since 2008. The company reported $41.7 million in revenue in 2009.
“The acquisition of Fusepoint is a step toward one of our most important goals to expand our geographic presence around the world,” says Jim Ousley, Savvis chairman and CEO. “Our largest customers have been asking us to expand into Canada, and the acquisition of Fusepoint allows us to do so in a seamless and efficient manner. Our best-in-class product set and strong vertical market focus meshes well with Fusepoint’s fast growth and deep penetration of Canadian enterprises. Fusepoint has a great track record and extends Savvis’ reach into the highly promising Canadian hosting market including Toronto, the financial center of Canada.”
Fusepoint’s three data centers have a total of more than 40,000 sellable square feet, with Toronto the largest at 28,000 sellable square feet. Over the past several years the company has made significant investments in its data centers.
Savvis plans to finance the acquisition, which is expected to close early this summer, from available cash and an upsize in its existing revolver led by Wells Fargo Capital Finance, part of Wells Fargo & Company.
GCA Savvian Advisors served as exclusive financial advisor while Arnold & Porter served as legal advisor to Savvis.
Signal Hill Capital Group served as exclusive financial advisor, Edwards Angell Palmer & Dodge served as legal advisor and Olsler, Hoskin & Harcourt served as special Canadian counsel to Fusepoint.
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