Data-center operator Cyxtera files for bankruptcy

Cyxtera Technologies

05/06/2023 05:48

June 4 (Reuters) - Data-center operator Cyxtera
Technologies Inc  CYXT.O  filed for U.S. bankruptcy protection
in New Jersey on Sunday, 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 allows companies to keep their privately-owned
servers and networking equipment in a third-party data center,
such as ones owned by Cyxtera.
    In March, the company entered into an agreement with its
lenders to extend its $120.1 million revolving credit facility
and extended its maturity to 2024.
        Cyxtera shares have dropped more than 90% since it
listed on the Nasdaq in 2021, trading at $0.16 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 $3.4 billion.
        The company, which currently runs more than 60 data
centers, listed both assets and liabilities in the range of $1
billion to $10 billion. It has more than 5,000 creditors and
entered into a process of restructuring its business earlier in
May. 
    It received $50 million last month and said in a statement
on Sunday it got an additional commitment of $200 million in
debtor-in-possession financing from its lenders to keep itself
afloat during the Chapter 11 process. 
    The company operates across 30 markets. It said that its
subsidiaries in Germany, Singapore, and the United Kingdom are
not included in the court-supervised process.
    Cyxtera said it intends to pay employee wages, salaries, and
benefits without interruption.

 (Reporting by Mrinmay Dey in Bengaluru; Editing by Nivedita
Bhattacharjee)
 ((Mrinmay.Dey@thomsonreuters.com;))