DigiPlex filing for receivership

The pan-European Internet hotel operator is set to file for receivership in the latest of a growing list of European casualties.

DigiPlex, the Switzerland-based “internet hotel” is facing a cash crisis following the news that it has used up the majority of its funding. The Financial Times reports that Deloitte & Touche have been appointed as receivers in the UK.

Over the past two years, the firm has received over E380m in funding from a variety of private equity backers including The Carlyle Group, Goldman Sachs and Deutsche Bank. The most recent funding came in May last year, when the firm secured E55m in third round financing from The Carlyle Group and Providence Equity Partners.

The co-location company has suffered as a result of the general downturn in the Internet hosting sector which has failed to deliver on a wealth of funding generated at the height of the technology boom. In August last year, CityReach International ran through its £244m of funding, and Telecity was forced into a rescue rights issue. It is now worth about £21m.

DigiPlex was established by Genuity founder Geir Ramleth in 1999 with the intention of establishing internet co-location facilities across Europe. To date, the firm has set up six facilities – in London, Geneva, Frankfurt, Milan, Munich and Oslo. Carlyle is understood to have a 32.5 per cent stake in the firm, with Providence Equity Partners controlling just under 30 per cent.