Cyxtera Technologies: Data center colo provider Cyxtera declares bankruptcy

Jun 07, 2023 | Posted by Abdul-Rahman Oladimeji

The US colocation provider Cyxtera has declared bankruptcy. Cyxtera began a pre-arranged court-supervised procedure under Chapter 11 of the United States Bankruptcy Code following the Restructuring Support Agreement (RSA) originally made with certain lenders. Cyxtera stated that it intends to utilize Chapter 11 to bolster its financial position, significantly deleverage its balance sheet, and facilitate its continued growth. Some lenders have committed $200 million in debtor-in-possession financing, which is transferable into an exit credit upon the company's withdrawal from Chapter 11. The financing is anticipated to provide Cyxtera with sufficient liquidity during this procedure.

Simultaneously, Cyxtera stated that it continues to pursue a potential sale of the company or a substantial investment from a new investor. The Chapter 11 process does not include the Cyxtera entities in Germany, Singapore, and the UK. Users will be able to have access to their data center facilities and equipment throughout the process.

The colo company stated that it would continue to pay staff wages, salaries, and benefits with no interruption, as well as pay vendors and suppliers in full for products and services rendered on or after the filing date. Kirkland & Ellis LLP serves as Cyxtera's legal counsel, Guggenheim Securities LLC serves as its financial advisor, and AlixPartners LLP serves as its restructuring advisor.