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Cyxtera receives court approval to sell assets to Brookfield following bankruptcy

Written by Mon 20 Nov 2023

Data centre provider, Cyxtera, has received court approval to sell the majority of its assets to Brookfield Infrastructure Partners and its institutional partners after going bankrupt.

The US Bankruptcy Court for the District of New Jersey approved the decision and will also confirm the data centre colocation provider’s Plan of Reorganisation.

Chief Executive Officer of Cyxtera, Nelson Fonseca, said the sale to Brookfield will provide Cyxtera with additional financial flexibility. It will also enable the company to benefit from Brookfield’s global infrastructure expertise.

“Demand for our innovative data centre services remains high, and we see significant opportunities ahead with our customers as we enter this next phase of growth,” said Fonseca.

Cyxtera entered into an asset purchase agreement (APA) with Brookfield on 1 November for a sale of substantially all of Cyxtera’s assets for £634.2 million ($775 million). 

In connection with the APA, Brookfield also made agreements with Cyxtera’s landlords to purchase the real estate associated with seven of its US data centres. 

Cyxtera amended the terms of its leases at three US data centre sites and three international sites to allow it to exit those sites in 2024.

“Our partnership with Brookfield will strengthen our business, and we remain committed to ensuring the transition is as seamless as possible for all our stakeholders,” added Fonseca.

Cyxtera expects to complete the transaction with Brookfield and emerge from the court-supervised process in Q1 2024. This timeline is subject to regulatory approval and the satisfaction of customary closing conditions.

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Written by Mon 20 Nov 2023

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