TeleCity Group received an offer for a takeover, from one of the biggest data center companies based in the USA, namely Equinix Inc (NASDAQ:EQIX).
Equinix offered Telecity £2.3bn in a cash and share deal. The attractive offer made the UK company rethink its decision to purchase InterXion Holding NV (NYSE:INXN). The talks with the Dutch group had yielded an agreement equivalent to £1.6 billion.
There is a chance that Equinix’s CEO, Steve Smithmight disapproves the transaction. He claims that the deal might limit the company’s reach to a few places in the European region. He went on to suggest that since the company operates over the internet, it is a good idea to expand its operations to the international scene.
Smith has increased the chances of rival companies bidding for the opportunity to purchase the UK Company by disrupting the original bid from Telecity. The company’s new found appeal could also be fueled by the fact that it has other potential operators in the UK region. One of its most important assets is a data center that is located in Dockland. It is a high-value asset because it is home to servers harboring numerous active securities traders.
The other available options especially for other rival investor companies are the other open option. Interxion was the initial company to be acquired. The fact that such a deal had been offered means the company is still a viable option. Therefore, it might be a consideration for the rival firms. One of the potentially interested companies is Digital Reality, which is based in the USA.
In the meantime, Telecity is left with the negotiations for the share price. Currently, the offer stands at £11.45 per share. The US based company claims to have higher ratings and performance standards. The terms of the deal will most likely include a 46% share stake and the rest will be offered up in the form of cash. The buyout will probably improve Telecity’s status as an independent entity especially considering the rough path the company has experienced in the past.
