Exodus Closes Planned Centers; Buyout Possible - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
News

Exodus Closes Planned Centers; Buyout Possible

The bankruptcy filing by Exodus Communications Inc. last week didn't come as a surprise, but it cast a pall over the Web-hosting market and left more than 4,000 customers wondering if the data centers in which their Web sites are maintained would be affected. Analysts say that by filing for bankruptcy protection while it still had millions in the bank, Exodus (EXDS-Nasdaq) may be restructuring its debt as part of a planned buyout. "They must have a suitor waiting in the wings, otherwise they'd hold out a little longer," says Joel Yaffe, a Giga Information Group analyst.

Bill Krause, Exodus' new CEO, declined to comment on whether the company is in talks with a buyout partner. He says that although its goal is to remain independent, Exodus is considering a number of options, including new investors, selling assets, and selling the company. "If someone comes along with an offer that maximizes value for Exodus, we have 3,000 employees behind it," says Krause, who became CEO after Ellen Hancock left three weeks ago.

As part of its reorganization, Exodus plans to stop building 10 data centers that were under construction, none of which have customers. Its remaining 44 facilities, including major centers in Chicago, Dallas, New York, Seattle, and Santa Clara, Calif., will continue operating. To stem losses, which reached $538 million last quarter, Krause has realigned his sales force to focus on filling underutilized facilities and will ask delinquent customers to vacate. Exodus has secured $200 million in financing from GE Capital to ensure continued service during the restructuring.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
State of the Cloud
State of the Cloud
Cloud has drastically changed how IT organizations consume and deploy services in the digital age. This research report will delve into public, private and hybrid cloud adoption trends, with a special focus on infrastructure as a service and its role in the enterprise. Find out the challenges organizations are experiencing, and the technologies and strategies they are using to manage and mitigate those challenges today.
Slideshows
What Digital Transformation Is (And Isn't)
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/4/2019
Commentary
Watch Out for New Barriers to Faster Software Development
Lisa Morgan, Freelance Writer,  12/3/2019
Commentary
If DevOps Is So Awesome, Why Is Your Initiative Failing?
Guest Commentary, Guest Commentary,  12/2/2019
Register for InformationWeek Newsletters
Video
Current Issue
The Cloud Gets Ready for the 20's
This IT Trend Report explores how cloud computing is being shaped for the next phase in its maturation. It will help enterprise IT decision makers and business leaders understand some of the key trends reflected emerging cloud concepts and technologies, and in enterprise cloud usage patterns. Get it today!
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll