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A specialist acquisition company backed by shareholder activist Starboard Value LP is set to close a deal with data center provider Cyxtera Technologies Inc., according to people familiar with the matter.
Starboard Value Acquisition Corp. is discussing a deal that would value Cyxtera at around $ 3.4 billion, including debt, the people said. It could be finalized on Monday assuming the talks don’t collapse, they said.
Current owners of Cyxtera, including private equity firms BC Partners and Medina Capital, plan to transfer their stakes in the merged company, the people said.
Cyxtera has more than 60 data centers around the world, serving thousands of businesses and government agencies. It is one of the largest retail colocation providers, with its data centers serving and connecting multiple customers and supporting the widespread adoption of hybrid cloud infrastructure. The demand for data management was already on the rise thanks to the growth of everything from drones to internet-connected gadgets, when the remote working and schooling required by Covid-19 gave the industry a further boost.
PSPCs, which have exploded in popularity, raise funds as part of an initial public offering, then look for a company to combine in a deal that gives the target an alternative route to public procurement. The Starboard vehicle raised $ 360 million when it went public last year. On top of that, Cyxtera is expected to receive funds raised alongside the merger, as is typically the case in PSPC deals.
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