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Data centre operator Cyxtera files for bankruptcy

Tan KW
Publish date: Tue, 06 Jun 2023, 10:17 AM
Tan KW
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NEW YORK: Data centre operator Cyxtera Technologies Inc files for US bankruptcy protection in New Jersey, two years after the company went public, as it struggles to pay down debt and faces a severe funding crunch.

Miami, Florida-based Cyxtera is a provider of co-location services, which allow companies to keep their privately owned servers and networking equipment in a third-party data centre, such as the ones owned by Cyxtera.

In March, the company entered into an agreement with its lenders to extend its US$120.1mil revolving credit facility and extend its maturity to 2024.

Cyxtera shares have dropped more than 90% since it listed on the Nasdaq in 2021, trading at 16 US cents (73 sen) as of last close. It had agreed to go public through a merger with a blank-check firm backed by shareholder activist Starboard Value LP in a deal valuing the combined entity at US$3.4bil .

The company, which currently runs more than 60 data centres, listed both assets and liabilities in the range of US$1bil to US$10bil . It has more than 5,000 creditors and entered into a process of restructuring its business earlier in May.

It received US$50mil last month and said in a statement on Sunday that it got an additional commitment of US$200mil in debtor-in-possession financing from its lenders to keep itself afloat during the Chapter 11 process.

 - Reuters

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