Bell and Investor Group to Acquire Q9 Networks

BCE (News - Alert) Inc., Canada's well recognized communications company, having Bell and Bell Aliant as its brands that provide broadband wireless and wireline communication services across Canada, will join hands with an investor group, comprising of Ontario Teachers' Pension Plan, Providence Equity Partners (News - Alert) and Madison Dearborn Partners LLC, to acquire 100 percent of Canadian data center operator Q9 Networks Inc.

The deal, as indicated is signed for C$1.1 billion. Also, the transaction is expected to close before the end of 2012, subject to regulatory approval and customary closing conditions.

"Q9 is a recognized leader in data center services for business customers large and small, an ideal partner to grow our hosting and cloud-based business while leveraging our world-leading broadband network infrastructure," Tom Little, president of Bell Business Markets, said in a press release.

"Bell looks forward to working with our partners and to offering our national business customer base access to Q9's hosting and co-location services while delivering Bell's broadband network solutions to Q9's extensive client roster," Little added.

As per the terms of this agreement, Teachers, Providence and Madison Dearborn will contribute 70 percent of the equity funding and Bell will provide the remaining 30 percent.

With 11 data centers in Alberta, British Columbia and Ontario, Q9 is Canada's reputed provider of outsourced data center solutions for organizations with mission-critical IT operations.

"Q9 looks forward to working with these leading private-equity firms and Canada's largest communications company, all of which have a strong track record of growing leading-edge companies like Q9," said Osama Arafat, chief executive officer of Q9 Networks.

Q9 will continue to be headquartered in Toronto and its management will continue operating the company, including chief executive officer, Osama Arafat and president and chief operating officer, Paul Sharpe, both recognized leaders in the data center infrastructure space.

"This is a unique opportunity to partner with the world-class management team at Q9 and with Bell, the leading communications provider in Canada. We look forward to supporting Q9's continued growth with Bell, and adding lasting value at the company," the investor group said in a joint statement.