SoftLayer and The Planet Shed Light on Merger
In 2005, 10 management staff left to form Metro SoftLayer. Five years later, SoftLayer and the planet are looking at a possible merger. In a move that Doug Erwin, CEO of El Planeta, jokingly referred to as “what goes around comes around, life is an endless circle,” Planet and SoftLayer proposed merger would definitely be an adjusted loop. The merger would create one of the largest dedicated hosting companies in the world, with more than 25,000 customers and 78,000 + some servers.
Although the merger is not yet a fact between the two companies, both Lance Crosby, SoftLayer CEO, and Doug Erwin believe that the end is almost in sight. During a telephone conversation on Friday, Lance and Doug gave his opinion on the brewing merger agreement between the two companies.
“Is this agreement a 100% done? Well, we can not say we are 100%, but we are very close to that. And Doug and I are very close to putting these two companies in the next 90 days,” says Lance.
Doug adds: “Let me put it another way. It’s not over until the fat lady sings .. and she is warming to the side. There are a lot of work to do between our two clubs, and I think we are on the right way, which hired an outside consultant Bain consultant … to come and work with us. ”
As both sides continued to search for the merger, one of the number one concern has been to ensure existing customers are treated well. As customers Erwin said: “I think the biggest concern I have is for Lance and seamless integration that does not affect customers.” To this end, the consultancy Bain & Company has been hired to ensure that the possible merger avoids the many pitfalls that can occur. |
“About 6 months SoftLayer GI Partners approached to make an investment in the company,” says Lance. “They made a big investment in this global space that includes Digital Realty, Savvis, Telx, Planet and more recently, ViaWest. After that we went and we started going through due diligence, they began to find There was a lot of common DNA with the planet and as we begin to close the process in the last 30 days or so, began exploring the possibility of putting these two companies together. ”
The common DNA not only extend to the family history between the two companies. It also includes many customers in common. Both are also directed to the tag and dedicated hosting space. However, if both companies were merely similar, merging them would simply create a larger company, which is technically not a bad thing … but would be a bit boring.
In addition to similar areas of interest, SoftLayer infrastructure brings his know how. Plans for the merger are: move customers to the automation layer SoftLayer. This results in the new company able to take on more clients, staff, low maintenance, yet continue to support the highest degree.
The Planet offers a suite of enterprise level services. That is, the planet’s location and managed hosting will bring to the party. Along with these addons of accommodation, the planet also brings in the level of the hosting company characteristics and experience in managing services.
SoftLayer, until recently, avoided the placement and managed hosting space. They have instead focused on its niche target and did not deviate from that path. And yet, when combined with the planet, the addition of these services is an integral part of the new company. So why now? Why SoftLayer, which have been sanctioned to avoid dilution of its brand, wants to increase its services and, in fact, consider adding these services as a definitive force? |
“He’s been on the drawing board for a long time and we will give SoftLayer approach to both types of services not yet seen in the industry. As we discussed internally going to get a big stick and put many of our competitors eyes when they see what we do for placement and managed services, “says Lance.
On the possibilities of an initial public offering, Lance says, “I think [an IPO] is the most logical step for the combined companies will be putting together a $ 300 million in revenues and rapid growth and reach a point where the number of potential suitors out their drops dramatically just by the size of the company for an initial public offering becomes the natural choice.
“So if you want short, one could say that the gloves are tied,” says Doug. However, in summary, the possible merger between the planet and could be a giant SoftLayer hosting rival by a few, especially in the market for dedicated servers.