ABRY Partners has sold its portfolio company Xand, a provider of IT managed services, to TierPoint. TierPoint is currently owned by an investor group that includes Cequel III management led by Chairman Jerry Kent, RedBird Capital Partners, The Stephens Group, Jordan/Zalaznick Advisers, and Thompson Street Capital Partners.
Xand, acquired by ABRY in October 2011, is a provider of colocation, cloud, disaster recovery, and managed services with six data centers located in New York, Pennsylvania, Connecticut, and Massachusetts. The company is headquartered north of White Plains in Hawthorne, NY (www.xand.com).
The acquisition of Xand is funded through a combination of incremental equity from TierPoint’s existing investors as well as a new investor, Ontario Teachers’ Pension Plan, led by Teachers’ Private Capital. RBC Capital Markets and Credit Suisse will be providing debt financing for the transaction.
TierPoint is a provider of information technology services including colocation, cloud and managed IT services. The company owns and operates data centers in seven markets: Baltimore, Dallas, Oklahoma City, Tulsa, Philadelphia, Seattle, and Spokane. The company is comprised of six former regional data center service providers: Colo4 in Texas, Perimeter Technology in Oklahoma, Adhost and TierPoint in Washington, Baltimore Technology Park in Maryland and Philadelphia Technology Park in Pennsylvania. TierPoint is headquartered in St. Louis (www.tierpoint.com).
With the closing of the transaction, TierPoint now operates 13 highly-redundant, Tier III plus data centers with nearly 300,000 square feet of raised floor. The addition of Xand also positions TierPoint to significantly expand data center capacity in the future by an additional 150,000 square feet of raised floor to support the long-term demands of its customers. The consolidated company will also share a common cloud infrastructure supported by partners such as Cisco, NetApp, and Fortinet.
ABRY Partners invests in the media, communications, and business and information sectors. ABRY is currently investing ABRY Partners VII (a $1.6 billion private equity fund), ABRY Senior Equity III (a $750 million senior equity/mezzanine fund) and ABRY Advanced Securities Fund II (a $1.2 billion senior debt fund). The firm is headquartered in Boston (www.abry.com).
Paul Estes, TierPoint CEO, said the process of integrating resources, systems and teams, as well as the rebranding of Xand’s properties is underway and expected to be completed within the next year. “We expect the integration to go very smoothly. At the same time, we are continuing to look for potential acquisitions to add to our platform,” he said.
DH Capital (www.dhcapital.com), a New York-based investment bank specializing in data centers, managed hosting, cloud computing, cable television, telecomm, and software-as-a-service, was the exclusive financial advisor to ABRY and Xand.
© 2014 PEPD • Private Equity’s Leading News Magazine • 12-3-14