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CenturyLink Sells Data Centers for $2.15BCenturyLink Sells Data Centers for $2.15B

The assets go to a consortium of investors, as CenturyLink picks up coin for its $24 billion Level 3 acquisition.

Mitch Wagner

November 4, 2016

2 Min Read
CenturyLink Sells Data Centers for $2.15B

Following its announcement this week of plans to buy Level 3 Communications, CenturyLink said Friday it will sell its data center and colocation business to a group of investors for $2.15 billion in cash. CenturyLink will also get a minority stake valued at $150 million in the consortium's global secure infrastructure company.

CenturyLink Inc. (NYSE: CTL) is selling off its portfolio of 57 data centers to the consortium, comprising funds advised by BC Partners , Medina Capital Advisors and Longview Asset Management, the telecom company said in statement Friday. The deal is expected to close in the first quarter of 2017.

CenturyLink will use the money to partly fund its $24 billion acquisition of Level 3 Communications Inc. (NYSE: LVLT), announced Monday. (See CenturyLink Splashes $34B on Level 3 Buy.)

The data centers will become part of a joint venture between BC Partners and Medina Capital, expected to launch in the first quarter of 2017, focusing on cybersecurity, data analytics and IT infrastructure, the two companies said in a statement. Other services in the joint venture include Cryptzone, for perimeter security; Catbird, for segmentation, visualization and security policy enforcement across cloud infrastructure; Easy Solutions for fraud detection; and Brainspace for machine learning, data discovery and analytics, and insider threat detection.

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The new joint venture will have more than 3,500 customers and 2.6 million square feet of raised floor capacity, the partners said.

Manuel Medina, founder and managing partner of Medina Capital, will be CEO of the new company, joined by the executive team from Medina Capital, including the former senior leadership of Terremark, a data center, cybersecurity and infrastructure services company acquired by Verizon in 2011 in a $2 billion transaction, the partners said. (See Verizon Taps Terremark for $1.4B.

Early last month, Verizon was reportedly in a deal to sell its data center assets to Equinix for about $3.5 billion, but nothing has been confirmed yet. (See Verizon Nearing $3.5B Data Center Sale to Equinix – Report.)

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About the Author(s)

Mitch Wagner

Executive Editor, Light Reading

San Diego-based Mitch Wagner is many things. As well as being "our guy" on the West Coast (of the US, not Scotland, or anywhere else with indifferent meteorological conditions), he's a husband (to his wife), dissatisfied Democrat, American (so he could be President some day), nonobservant Jew, and science fiction fan. Not necessarily in that order.

He's also one half of a special duo, along with Minnie, who is the co-habitor of the West Coast Bureau and Light Reading's primary chewer of sticks, though she is not the only one on the team who regularly munches on bark.

Wagner, whose previous positions include Editor-in-Chief at Internet Evolution and Executive Editor at InformationWeek, will be responsible for tracking and reporting on developments in Silicon Valley and other US West Coast hotspots of communications technology innovation.

Beats: Software-defined networking (SDN), network functions virtualization (NFV), IP networking, and colored foods (such as 'green rice').

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