A consortium of investors including BC Partners and Medina Capital have agreed to buy CenturyLink’s data centers and colocation business for $2.15 billion in cash and a minority stake (valued at $150 million) in the group's new cloud infrastructure company. BC Partners and Medina beat out a coterie of other PE bidders to acquire the business. CenturyLink will use some of the proceeds to fund its recently announced acquisition of Level 3 Communications.
In conjunction with that deal, BC Partners and Medina also announced the purchase of two cybersecurity companies: Catbird and Easy Solutions. Taken together, the three purchases have some significant strategic ramifications for the acquirers.
Namely, they represent the latest steps toward a joint venture that will combine CenturyLink's newly acquired data centers with Medina's extant cybersecurity and data analytics portfolio—the latter of which now includes Catbird (a supplier of cloud security) and Easy Solutions (a fraud-protection provider) in addition to cloud-infrastructure security business Cryptzone and machine-learning software provider Brainspace.
The new venture likely won't compete with the big players in the data-center space, including Amazon Web Services, the newly minted Dell Technologies and industry stalwart Microsoft. But it will fill a real niche in the information security market, using its 57 data centers with 2.6 million square feet of floor capacity to service more than 3,500 customers.