M/C Venture Partners has closed the sale of the firm’s portfolio company Fusepoint, a privately held managed hosting and collocation services company, to Savvis, a cloud infrastructure and hosted IT solutions provider.
The base all-cash consideration for Fusepoint’s stock was valued at the previously-announced USD124.5m, or 10.4x annualized Q1 2010 Ebitda.
“This was a very successful investment for M/C Venture Partners and demonstrates our foresight and commitment to investing in the managed hosting and collocation services industry,” says David Croll (pictured), managing general partner at M/C. “This transaction represents one of the more successful managed hosting and collocation services exits by a venture firm in recent years. We are extremely proud of the outcome with Fusepoint.”
M/C Venture Partners was the sole institutional investor and controlling shareholder in Fusepoint, which is headquartered in Toronto and operates three Canadian data centres. M/C Venture Partners invested approximately USD30m in Fusepoint to fund an aggressive growth strategy involving expansion of the company’s operations and the acquisition of key Canadian assets.
The company has experienced strong growth in recent years, with compounded revenue growth of 18 per cent and compounded adjusted Ebitda growth of 83 per cent since 2006. For the first quarter of 2010, Fusepoint generated annualised revenue of USD47.4m and adjusted Ebitda USD12.0m.
"M/C Venture Partners has been integral to our success since the beginning by helping us monetise our market opportunity, build the team and properly capitalize the company for success," says George Kerns, who served as chief executive officer of Fusepoint. "M/C’s deep expertise in the managed hosting space and its vision of where the market was going ensured we were always on the right path that ultimately led to this successful sale to Savvis."
Signal Hill Capital Group served as exclusive financial adviser, Edwards Angell Palmer & Dodge served as legal adviser and Osler, Hoskin & Harcourt served as special Canadian counsel to Fusepoint.
M/C Venture Partners is a venture capital firm focused exclusively on the communications, media, and information technology sectors.
