Contact: Scott Denne Kelly Morgan Michael Levy
Canadian cable company Shaw Communications swoops into the multi-tenant datacenter market with the $1.2bn acquisition of ViaWest. Shaw may be wading in later than its Canadian telco peers, but the deal brings it instant scale. In terms of enterprise value, this is the fifth-largest purchase of a managed services vendor, according to The 451 M&A KnowledgeBase.
The transaction ($830m in cash and the assumption of $370m in debt) values ViaWest at 17.4x its 2013 EBITDA of $69m – a higher multiple than GI Partners was rumored to have paid for Peak 10 (12x), or Rogers Communications paid for BLACKIRON Data last year (15x), but less than Cogeco’s multiple for PEER 1 (22x). RBC Capital Markets served as adviser for ViaWest (as well as for Peak10), while TD Securities advised Shaw.
ViaWest will provide the hosting and cloud expertise needed to layer services on top of Shaw’s new fiber and datacenter assets, including a recently unveiled datacenter in Calgary and ENMAX Envision, the bandwidth service it picked up last year for $222m.
The sale of ViaWest should generate a solid return for Oak Hill Capital Partners, which bought the company four years ago (see our estimates of that transaction here).
Subscribers to 451’s Market Insight Service can find a more detailed report on Shaw’s purchase here.
For more real-time information on tech M&A, follow us on Twitter @451TechMnA.