CenturyLink pays $2.5B for Savvis
Nation's third-largest telecom adds managed IT and cloud services provider
- By David Hubler
- Apr 28, 2011
CenturyLink is buying Savvis in a cash and stock purchase agreement approved by both boards of directors.
The merger is valued at $40 per share, or approximately $2.5 billion, plus net debt of approximately $0.7 billion which will be assumed or refinanced at close, according to an April 27 announcement.
Merging Savvis’ managed IT services and enterprise-level cloud services with CenturyLink’s much larger telecommunications and networking operations, as well as its hosting assets, will provide immediate scale, the announcement said.
CenturyLink, the third largest telecommunications company in the United States, will have more than 50,000 employees.
The acquisition will bolster its ability to deliver managed hosting and cloud capabilities to business customers, the announcement said.
The company anticipates integrating its hosting business and Savvis’ managed hosting and cloud services into a single CenturyLink business unit based in St. Louis.
This integrated hosting business will be led primarily by key members of the Savvis leadership team, including CEO James Ousley, who will head the unit, the announcement said.
The combined company will operate 48 data centers in North America, Europe and Asia.
The deal is expected to close in the second half of this year.
David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.