1 Comment

Summary:

Internap, which till recently was in the business of providing interconnections and co-location services, started offering data center services and that has made it a likely target as telecoms eye buying into the fast growing datacenter business and tap into the cloud-computing gold rush.

INAP-001-14

If you’re in the data center and co-location business, now is as good a time as any for you to sell your company to free-spending telecom operators looking for their next big revenue stream and believing cloud is the answer. It is hardly a surprise then that AT&T, Windstream and Frontier Communications — almost everyone — is in the buying mood these days.

Verizon and  CenturyLink set off the race when they snapped up Terremark and Savvis, respectively. Equinix, Interxion Holding, Joyent, Rackspace and SoftLayer Technologies are considered as some of the likely targets. Internap, which until recently was in the business of providing interconnections and co-location services, started offering data center services and that has made it a likely target, analysts say.

“We believe Internap represents a compelling buy as it operates defensive telecom businesses with solid growth prospects, has no debt and the recent drop in the stock,” Clayton Moran, an analyst at The Benchmark Co, told Reuters.

Don’t believe the hype, says Internap CEO Eric Cooney. He told Reuters:

‘I am not shopping the company and we listen to any offers that come in and respond accordingly. … At this stage the best value for our shareholders is to continue executing our organic growth plan. … Increasingly we will look much more like Rackspace, Savvis or Terremark did before they got acquired, in terms of revenue and profitability growth.’

Image courtesy of Internap.

  1. What are their shareholders saying, Om? Among equity analysts who cover INAP, what do they think about the shareholder value that could be created through a sale?

    Share

Comments have been disabled for this post