NaviSite Sells Two Data Centers for $5.4 Million

Managed hosting provider NaviSite (NAVI) has announced the sale of two data centers to Virtustream for $5.4 million as part of its plan to focus its business on complex hosting and application management. Virtustream, which is based in Washington with additional operations in the UK, will take over one NaviSite data center in Vienna, Virginia and another in the 650 Townsend carrier hotel in San Francisco. Both facilities are approximately 11,000 square feet.

All current NaviSite colocation customers at these sites will be transferred to Virtustream as part of the deal, while the managed hosting customers will remain with NaviSite. The proceeds from the sale will be used to repay NaviSite's debt.

“The sale of these assets is consistent with our strategy to focus on our enterprise business with cloud-enabled application management and hosting,” said Arthur Becker, NaviSite’s Chief Executive Officer. “We continue to sharpen our focus on our core strengths while enhancing our balance sheet.”

“By acquiring these strategic assets from NaviSite, we are expanding our high density data center footprint and enhancing the redundancy within our xStream cloud platform,” said Kevin Reid, Chief Executive Officer at Virtustream. “These sites increase our ability to provide a comprehensive set of SLAs around our infrastructure as a service offering.”

Unveiled earlier in March, xStream is an enterprise cloud platform that offers both private and external cloud environments. Data is replicated real-time in a second data center, allowing for a failover with minimal interruption.

"The benefits of cloud computing have been well-advocated, but customers are only willing to pick cloud computing services from vendors with deep knowledge and experience about virtual, elastic environments, world class security execution and a keen understanding of strategies to ensure that services don't go offline," said Kevin Reid, chief executive officer at Virtustream.