Cogeco Communications Divests Its Cogeco Peer 1 Cloud and Data Center Business for $720M

Author(s): Darin Stahl

Cogeco Communications has divested its Cogeco Peer 1 cloud and data center business to Digital Colony for $720 million. Cogeco Peer 1 delivers colocation, cloud, and network connectivity from 22 data centers in North America and Europe.

Cogeco Peer 1 was created in 2015 when Cogeco Data Services and Peer 1 Hosting were combined. As a standalone company, it is expected to remain headquartered in Toronto but will rebrand and restructure along networking and data center business lines. Its current product portfolio includes a continuum of services including colocation, hybrid cloud, private cloud, and connectivity to public cloud providers such as Microsoft Azure to a global blue-chip customer base.

Our Take

Cogeco Communications’ divestiture of the cloud and data center business segment is not unusual. Like many other consumer-focused cable television, telephone, and internet companies, the cloud and data center business, while profitable, is not a core competency (Cyxtera Technologies was formed when CenturyLink divested its data center business). Existing Cogeco Peer 1 customers can expect the only disruption to be a brand change. Future customers of the resulting standalone entity will find a value-added, solutions-oriented service provider.

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