A special procurement company, backed by shareholder activist Starboard Value LP, is approaching a deal to merge with data center provider Cyxtera Technologies Inc., according to people familiar with the matter.
Starboard Value Acquisition Corp. discusses an agreement that would value Cyxtera at about $ 3.4 billion, including debt, people said. It could be completed by Monday, assuming the talks do not fall apart, they said.
Existing Cyxtera owners, including private equity firms BC Partners and Medina Capital, plan to transfer their stakes in the combined company, people said.
Cyxtera has over 60 data centers worldwide, serving thousands of companies and government agencies. It is one of the largest so-called retail roommates, with its data centers serving and connecting multiple customers and supporting the widespread adoption of hybrid-cloud infrastructure. The demand for data management has already been growing, thanks to the growth of everything from drones to internet-connected gadgets, when distance learning and the necessary schooling by Covid-19 have given the sector an extra boost.
SPACs, which have exploded in popularity, raise money in an initial public offering and then look for a business to combine with a business that offers the target an alternative route to public markets. The Starboard raised $ 360 million when it was released last year. In addition, Cyxtera is expected to receive funds raised alongside the merger, as is typical in SPAC transactions.