Investment Firm To Acquire Cogeco Peer 1, Which Will Operate As Independent Managed Cloud Services Provider

Cogeco Peer 1, a co-location, network connectivity and managed services provider, is being acquired by global investment firm Digital Colony. The sale will help transform Cogeco Peer 1 into a stand-alone hybrid networking and cloud service business, the provider said.

Cogeco Peer 1 is the cloud subsidiary of Cogeco Communications, which inked the deal to sell its cloud business to the investment firm for $720 million. Via the terms of the deal, Cogeco Peer 1 will have a fiber division and a data center division and will operate under a different name, the two companies said Wednesday.

Cogeco Communications acquired Peer 1 Hosting in 2013.

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Toronto-based Cogeco Peer 1 has more than 3,300 route kilometers, or 2,050 miles, of metro fiber in the greater Toronto and Montreal areas. The company also owns and operates 16 data centers across North America and Europe, and has more than 50 points of presence throughout North America and Europe.

After the deal is closed and Cogeco Peer 1 is operating independently, the provider's fiber division will be Canada’s first independent, neutral-host provider of small cell and 5G infrastructure and enterprise and wholesale fiber connectivity, according to the company. Cogeco Peer 1’s data center division will be focused on providing multi-cloud services for enterprise customers, as well as growing its dominance in the hybrid cloud and managed services space.

"We are grateful for the support and resources Cogeco Communications has provided as we established a strong fiber footprint in Canada’s two largest cities, and served customers across the globe with secure enterprise data center solutions,” Cogeco Peer 1 CEO Susan Bowen said in a statement. “As we enter our next phase of growth as a stand-alone company, we will continue to focus on meeting the needs of customers while looking for new ways to innovate and deliver the digital infrastructure solutions they need."

The company is looking forward to working with Digital Colony, a firm with industry experience and a strong balance sheet, to help scale and better help small to midsize businesses and enterprises address digital transformation, Bowen said.

The two companies expect the deal, which is subject to regulatory closing conditions, to close during the second quarter of 2019.

Cogeco Peer 1 revamped its channel strategy and introduced three new programs in 2017, including its Referral Partner Program, Referral Partner Plus Program and Reseller Partner Program.