Data Center Provider TierPoint Seeks $500 Million Investor

Gillian Tan and Scott Soshnick (Bloomberg) -- TierPoint LLC, a provider of data centers and other technology services to clients including the National Hockey League and the Bill & Melinda Gates Foundation, is exploring strategic options including raising new equity, according to people with knowledge of the matter.

The St. Louis-based company, led by telecommunications entrepreneur Jerry Kent, is seeking an equity injection of $250 million to $500 million, said some of the people, who asked not to be identified because the matter is private. A person close to TierPoint said such capital would be used to expand its data-center presence in so-called edge markets -- such as Nebraska, Kansas, Oklahoma and Missouri -- which are farther from traditional internet hubs.

A sale of the company, which could fetch more than $2.4 billion in such a transaction, is also possible, the people said.

TierPoint, which has tapped advisers, is likely to draw interest from rivals as well as private equity and infrastructure investors.

Pete Abel, a representative for TierPoint, declined to comment. The company counts RedBird Capital Partners, Ontario Teachers’ Pension Plan and TA Associates among its investors. A RedBird Capital representative declined to comment, while representatives for the pension plan and TA didn’t immediately respond.

Related:Investor Edge: Exclusive - TierPoint CEO Jerry Kent Talks Strategy

In addition to operating more than 40 data centers across the U.S., TierPoint offers disaster-recovery, security and consulting services. Its other clients include drugstore company Walgreens Boots Alliance Inc. and fast-food chain Potbelly Corp., according to the TierPoint website.