Global Switch deal smooths Chelsfield MBO
Sunday 20 July 2003
Chelsfield, the property company at the centre of management buyout talks, is this week expected to announce the partial sale of its data centre business for £100m.
Morley Fund Management will take a 25 per cent stake in Chelsfield's Global Switch, which has been hit by the downturn in the technology market. The deal will help smooth the way for a £2bn buyout of Chelsfield, led by chairman Elliott Bernerd.
Last week HBOS emerged as one of Mr Bernerd's backers. The bank is in negotiations to provide 15 per cent of the £500m equity needed to fund the deal. It is expected that as a result of the buyout, Nina Wang, one of Asia's richest women and owner of 12.3 per cent of Chelsfield, will sell out completely.
HBOS is also in talks to help finance the £1.5m in debt needed for the buyout. But the bank is understood to be lukewarm about keeping Global Switch, which was set up by Andy Ruhan, the entrepreneur who is involved in the acrimonious takeover of shell company Izodia. Chelsfield took control of Global Switch in March 2002 after buying a stake owned by Canadian property group TrizecHahn.
But Global Switch has suffered from the collapse of some of its tenants, notably telecoms companies Global Crossing and KPNQwest. In March, Chelsfield reported that Global Crossing contributed a loss and write- downs of £36.8m in 2002.
Global Switch is still loss making but there are signs it is beginning to turn the corner. The company operates eight data centres, including the former FT print works site in London's Docklands. The centres provide space for companies to house their communications equipment.
While Europe was flooded with data centres during the technology boom, there are signs that supply has reduced and demand is increasing. It is understood that, in the next few weeks, Global Switch will announce a crop of new lettings, including deals with IBM and Shell.
Morley had originally planned to buy out Global Switch for around £400m. But after nine months of negotiations, talks broke down in January.
- 1 The difference between a psychopath and a sociopath
- 2 It won’t work, Jeremy: The Health Secretary has lost the confidence of the medical profession in his attempt to reform the NHS
- 3 Uber's real-time nearby cars map is fake, data experts claim
- 4 Kim Jong-un awarded global statesmanship prize by Indonesia
- 5 Dutch King Willem-Alexander declares the end of the welfare state
Nasa discovers yet another rocky exoplanet, and it's only 21 light years away
Labour rallies behind Flint as deputy leader to offset a Corbyn win
Kim Jong-un awarded global statesmanship prize by Indonesia
Dutch King Willem-Alexander declares the end of the welfare state
Calais crisis: Migrants that have made a home in the UK reveal how Britain has matched their expectations
Yvette Cooper: Our choice is years of Tory rule under Jeremy Corbyn – or a return to a Labour government
Is Britain really full up? Are migrants taking our jobs? Leading academic answers the most common anti-immigration claims
Calais Migrant Crisis: Deputy Mayor of Calais labels Cameron's use of 'swarm' as 'racist' and 'ignorant'
Labour leadership: New poll shows party is now even 'less electable' than under Ed Miliband
While we fixate on Calais, the Home Office is quietly deporting dozens of migrants on 'ghost flights'
Calais crisis: The seven claims made about the migrants - and the reality
iJobs Money & Business
£30000 - £35000 per annum: Recruitment Genius: This is an exciting opportunity...
£13000 - £15000 per annum: Recruitment Genius: Are you passionate about custom...
£22000 - £25000 per annum: Recruitment Genius: Main purpose: Under the directi...
£35000 - £37000 per annum + benefits : Ashdown Group: Contracts Manager - City...