(Bloomberg) — Switch Inc., a data-center operator, is exploring strategic options, including sales, according to people with knowledge of the matter. Shares rose up to 5 per cent.
The Las Vegas-based company, led by President and Chief Executive Officer Rob Roy, is working with advisors, the people said.
A Switch representative declined to comment.
The company announced in November that its board had voted to support its conversion to a real estate investment trust, after saying in August that it would evaluate that option in collaboration with Elliott Investment Management.
Shares rose 2.2% to $29.41 at 3 p.m. in New York, reaching $30.22. They have gained around 2.7 per cent this year. The company had a market capitalization of $7.2 billion as of Monday afternoon.
In a note to clients this month, Cowen analysts led by Michael Elias wrote that they believed “there is an increasing likelihood that Switch could be a candidate for a private one.” They cited the amount of private capital devoted to the data-center sector, the valuation gap between public and private companies, and the limited availability of platforms following the recent merger.
Switch is one of the largest remaining listed data-center operators in US rival CyrusOne Inc., which was agreed to be acquired by KKR & Co and Global Infrastructure Partners last year. Also in 2021, QTS Realty Trust Inc. was acquired by Blackstone Inc. and was acquired by affiliates of CoreSight Realty Corp. was purchased by American Tower Corp.
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