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GI Partners and Management Acquire SoftLayer®

August 4, 2010 by  

Web Host ServicesDALLAS & MENLO PARK — SoftLayer Technologies®, the innovative on-demand data center services provider, today announced a transaction in which its management team and GI Partners, a private trans-Atlantic investment firm, have acquired all of the equity in SoftLayer.

Since its founding, SoftLayer has revolutionized hosting through its unswerving commitment to innovation and automation. At a pivotal time in the industry, as increased connectivity, virtualization advances, and cloud service innovations dramatically reshape the landscape, SoftLayer is poised to continue playing a significant role in the industry’s transformation.

“I’m extremely proud of how much SoftLayer has grown and accomplished in its history. GI Partners’ investment and partnership enables us to take our unparalleled approach to the next stage,” said Lance Crosby, Chief Executive Officer of SoftLayer. “It’s gratifying that a firm with GI Partners’ insight and success sees such value in SoftLayer’s past growth and future opportunities.”

“SoftLayer has taken a visionary model and created a company for the future of hosting,” said Rick Magnuson, Executive Managing Director of GI Partners. “We are excited to bring additional resources and experience to help SoftLayer leverage its strategic position in the expanding global data center services market.”

DH Capital served as exclusive financial advisor to SoftLayer in connection with the transaction.

QUICK FACTS:

  • GI Partners and the SoftLayer® management team have acquired all equity in SoftLayer Technologies®. Terms of the transaction have not been released.
  • GI Partners now owns a majority of the equity in SoftLayer.
  • SoftLayer’s executive team will continue to operate and manage the company.
  • The investment gives SoftLayer the firmest financial foundation in the company’s history, ideal for the company’s ambitious plans to grow and expand its services.
  • SoftLayer and GI Partners raised a combination of debt and equity to back the acquisition, repay existing obligations, and fund growth.
  • GI Partners has many other hosting, information technology, and related holdings, including Digital Realty Trust, The Planet, The Telx Group, and ViaWest.
  • SoftLayer was founded in 2005, beginning operations in January 2006.
    • The company has experienced consistent year over year growth.
    • First month of GAAP profitability was in October 2008; 21 consecutive months of GAAP profitability with sequential growth.
    • $110 million in annualized revenue in 2009.
    • 6,000 customers and over 30,000 servers under management.
    • $60 million in revenue first half of 2010; on track for setting record of over $125 million revenue in 2010.
    • EBITDA margins exceeding 50%.
  • SoftLayer recently moved into its new corporate headquarters in North Dallas.
    • The new location includes on-site data center space that will feature new capabilities such as enhanced networking options.
  • DH Capital served as exclusive financial advisor to SoftLayer in connection with the transaction, and DLA Piper acted as legal counsel. K&E acted as legal counsel to GI Partners.

About GI Partners
GI Partners, headquartered in Menlo Park, California, is a private equity firm established in 2001, managing approximately $4 billion of capital. The firm focuses on investments in asset-intensive businesses or portfolios of assets in a number of key sectors, including specialty healthcare, leisure, real estate, financial services, and technology. The firm has made several investments in the data center industry, most notably Digital Realty Trust in 2002, The Planet in 2006, The Telx Group in 2006, and ViaWest in 2010. For more information about GI Partners, please visit www.gipartners.com. Reach GI Partners in Menlo Park, California at +1 650-233-3600 and London, U.K. at +44 20 7034 1120.

About SoftLayer Technologies
Headquartered in Dallas, Texas, SoftLayer is a best-in-class, infrastructure-as-a-service provider with data centers in Dallas, Seattle, and Washington, DC, and network Points of Presence across the US. SoftLayer integrates and automates all IT elements, allowing customers to create cloud, dedicated, or seamless hybrid computing environments managed through a single interface. Enterprises of any size can have complete control, security, scalability, and ease-of-management in an on-demand IT solution. For more information, please visit www.softlayer.com or call 866.398.7638.

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