Private Equity Firm GI Partners Acquired Peak 10

IT infrastructure and data center service provider Peak 10 was recently acquired by private equity firm GI Partners. Before the deal was finalized in mid-May there was considerable speculation surrounding the rumored acquisition of data center operator by GI Partners.

Reuters, which reported on the matter just two days before the deal was finalized, noted that the IT infrastructure company was valued between an estimated $800 million and $900 million. While the exact price tag of the acquisition has yet to come to light, one thing is clear: Peak 10 is ready for considerable growth.

Peak 10: Value, service footprint
Before being acquired by GI Partners, Peak 10 was previously owned by Welsh, Carson, Anderson & Stowe, another private equity firm. When the firm first bought the data center operator in 2010, Peak 10 was valued at $400 million, according to the Charlotte Business Journal.

Peak 10 currently operates 24 data centers in the U.S., including its newly expanded Tampa Bay data center. The company provides data center services including private and enterprise cloud infrastructure, managed hosting and disaster recovery for clients in 10 key markets.

Since 2010, the data center service provider has raised revenues by 20 percent, and plans to further expand its profit margins under GI Partners' new management.

The acquisition: GI Partners emerges
Upon being put up for sale, a total of 11 firms expressed interest in acquiring Peak 10. However, GI Partners, the private equity organization behind a number of other high-profile acquisitions, emerged as the top potential buyer. In July 2013, GI Partners also sold SoftLayer Technologies to IBM Corp. for an estimated $2 billion.

On May 12, GI Partners and Peak 10 released a joint statement confirming the acquisition.

Poised for considerable growth
Peak 10 founder and CEO David Jones noted that thanks to the acquisition, Peak 10 could eventually double its current service footprint, reaching revenues of more than $1 billion over the next three years.

Jones said his company is in a good position with GI Partners to increase its expansion efforts, but it will first have to focus on making improvements to internal processes and automation. However, Peak 10's growth will likely include expansions into the upper Midwest and West Coast markets. 

"This is a pivotal time in the IT infrastructure space. Our industry continues to experience dynamic change with shifts and enhancements to virtual environments and the promise of the cloud," Jones said. "GI Partners' deep experience in value creation within our sector aligns with our aggressive plans to expand geographically and deliver new capabilities to the marketplace for companies who need a partner like Peak 10."

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