Bankrupt Cyxtera looks to sell data centres to Brookfield

BANKRUPT Cyxtera Technologies is in advanced talks to sell a large swath of its data centres to Brookfield Infrastructure Partners, according to people familiar with the situation.

As part of its Chapter 11 filing, Cyxtera has been looking at two possible tracks, either recapitalising itself, with lenders taking control of the firm, or selling itself. Cxytera’s and Brookfield Infrastructure Partners’s negotiations are continuing and could still fall apart, according to the people, who asked not to be identified because the matter is private.

Representatives for Cyxtera, Brookfield Infrastructure Partners, and Cyxtera’s financial adviser Guggenheim Securities declined to comment.

Brookfield Infrastructure Partners has been building its data centre holdings, with recent acquisitions of European firm Data4 and Compass Datacentres. It also owns Dawn Acquisitions, which does business as Evoque Data Center Solutions.

Digital Realty Trust has also shown interest in some of Cxytera’s ssets, Bloomberg previously reported.

Prior to its June bankruptcy, Cyxtera had entered negotiations with lenders on how to tackle nearly US$870 million of debt due next year. The company was formed in 2017 after CenturyLink’s data centre and co-location business was combined with Medina Capital’s security and data analytics operations. In 2021, Cyxtera combined with a black-cheque firm in a deal valuing the combined company at about US$3.4 billion on an enterprise basis.

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Cyxtera has scheduled a November 6 hearing to confirm its bankruptcy plan. BLOOMBERG