iWeb Gets $22M Funding from Goldman Sachs

Canadian hosting provider iWeb Group Inc.  has received $22 million (about $20.9 million USD) in financing from Goldman Sachs Credit Partners L.P., the company said today. iWeb (IWB) will use the funding to support the long-term growth of its data center operations and to lease dedicated servers. The company has three data centers in Quebec provice (in Montreal, Verdun and St-Leonard) and a point of presence in Washington, D.C.

"A deal of this magnitude will allow us to continue investing in the infrastructures which are vital to maintaining our growth, which has been outstanding thus far," said Marc Guindon, Vice-President and Chief Financial Officer.

The deal marks the second investment of 2008 in the data center industry for Goldman Sachs, which previously provided $75 million in credit and equity financing to support data center expansion for DataPipe, a New Jersey managed hosting provider.
The iWeb deal also includes both debt and equity. iWeb will initially receive $10 million (USD) in senior debt, will issue $2 million in common shares will to Goldman Sachs at $1.30 per share in several installments. Under the second part of the agreement, Goldman Sachs can provide an additional $8 million in senior debt with $2 million in shares to be issued at the market price, subject to certain conditions and performance indicators.

iWeb was founded in 1996 and today is one of Canada's leading providers of shared hosting, dedicated servers and colocation in three data centers totaling 48,000 square feet of floor space. iWeb provides services in English, French and Spanish to more than 14,000 clients from more than 135 countries.