Private Equity News & Analysis

3i records 5x on data centres

The listed private equity firm has exited its remaining 16.5% stake in Telecity, marking the second time 3i has parted ways with the European company.

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3i has exited its last shares in Telecity Group, 12 years after its initial investment in the European data centre operator.

The sale of its 16.5 percent stake netted £111 million, bringing 3i's total proceeds to £153 million since Telecity's public listing in 2007. The sum reflects a 5x multiple on its 2005 initial investment, which was the second time 3i backed Telecity.

3i first invested in Telecity in 1998 and took it public on the London Stock Exchange in 2001, turning a £19 million VC investment into a windfall that at the time was estimated to be up to £260 million.

Following the dotcom meltdown that severely affected many technology-related stocks, 3i and Oak Hill took Telecity private again in 2005. The company raised £436 million in an IPO in 2007.

The private equity firm said Telecity is poised for future success, noting it has recorded strong growth and earning post-IPO and made significant investments in Europe with the openings of new data centres in Paris, Stockholm and Milan and bolstering of capacity in London, Amsterdam and Frankfurt.