Internap Network Services Acquires Hosting Provider Voxel

Internap (News - Alert) Network Services Corporation, a provider of intelligent IT infrastructure services, announced it has acquired enterprise hosting and cloud services provider Voxel (News - Alert) Holdings for approximately $30 million in all cash transaction, plus an additional potential $5 million in cash tied to the delivery of specific objectives during the next two years.

The acquisition was closed on Friday, Dec. 30.

The acquisition is expected strengthen Internap's flexible IT Infrastructure platform thanks to the dedicated hosting and cloud products offered by Voxel. Voxel’s offerings provide a level of automation and self-service that will be available immediately to Internap's customer base, according to company officials.

Headquartered in New York City, with a global presence extending into North America, Europe and Asia, Voxel provides on-demand dedicated hosting and cloud services to enterprises and Web-centric businesses. The company serves more than 1,000 customers and has approximately 50 employees.

Eric Cooney (News - Alert), president and chief executive officer of Internap, said, "This acquisition of Voxel increases Internap's market share and growth rate, accelerates our product roadmap and creates an unmatched competitive position as an IT Infrastructure services provider."

The acquisition also extends Internap's addressable market, enabling the company to serve early- to mid-stage IT Infrastructure customers seeking dedicated hosting services. According to a Tier 1 research, dedicated hosting is a highly promising area and the market is expected to reach $3 billion in 2012.

The addition of Voxel's service locations in Amsterdam and Singapore will enable Internap to offer a truly global platform of colocation, managed hosting, dedicated hosting and cloud services. In addition to this, Voxel's automation technologies and expertise will be leveraged to enhance the existing Internap product set.

"We are excited to be joining Internap, a company that shares our commitment to developing innovative IT Infrastructure solutions to drive the next generation of Internet and cloud applications," said Raul K. Martynek, president and chief executive officer of Voxel, in a statement.

"The combination of Internap's broad market presence and robust, high-performance IT Infrastructure platform with our expertise in automated hosting and cloud services will deliver a powerful option for a broad range of enterprise customers," Martynek added.

Internap’s third quarter revenue totaled $62.0 million compared with $60.3 million in the third quarter of 2010 and $60.4 million in the second quarter of 2011. Revenue from Data center services increased year-over-year and sequentially. IP services revenue decreased compared with the third quarter of 2010, and was flat sequentially.