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Appeared on: Monday, October 28, 2013
NTT Comm To Buy U.S.-based Cloud Computing And Data Center Firms

NTT Communications Corp has agreed to buy U.S. cloud computing firm Virtela Technology and data center services provider RagingWire Data Centers for a total transaction price of approximately $875 million.

The acquisition ($530 million) of Virtela Technology will allow NTT to offer data services globally without licensing cables and lines in individual markets.

Virtela, a 400-employee company headquartered in Denver, Colorado with global operations and delivery centers in the US, India and the Philippines, serves more than 500 customers worldwide.

The respective strengths of Virtela and NTT Com will be unified through the integration of their respective operations, services and networks to be introduced on a combined basis from 2014. Using Virtela's flexible service activation and management infrastructure will further enhance NTT Com's broadband network services in nearly every country of the world.

NTT Com will also upgrade its cloud-based network services with Virtela's network function virtualization (NFV) technology to virtualize the functions of customers' network equipment, such as firewalls and WAN accelerators.

NTT Com will also acquire approximately 80% equity interest in RagingWire for $350 million. RagingWire has annual revenues of approximately $85 million (USD), and a compounded annual growth rate of 30%. RagingWire?s founders and management team will continue to operate the company as a platform under the RagingWire brand and maintain a minority interest in the company.

The acquisition will more than double NTT Com's data center space in the US which will enable the company to respond to high demand for data center services in North America. NTT Com will also deploy RagingWire's patented technologies for the design and operation of scalable data centers.

RagingWire was founded in the year 2000 and has approximately 300 employees. The company has 650,000 square feet of data center space at its campuses in Sacramento, California, and Ashburn, Virginia. Both campuses are currently being expanded. In addition, RagingWire has begun construction of a new 150,000-square-foot data center in Sacramento, and will soon break ground on a 78-acre parcel of land in Ashburn, Virginia with designs to build 1,500,000 square feet of data center space.

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