Content Delivery Provider Velocix Close To Being Acquired, Telco Most Likely

Last month I started hearing whispers from the banking community that content delivery network Velocix was close to being acquired with multiple parties interested. I can now confirm that Velocix is in fact negotiating the sale of the company with at least two interested parties at mid to late stages of the process.

While I am not giving out any more details on who those two companies may be, I can say that various companies in the telco and network equipment community have shown interest in Velocix, primarily for their recently announced Metro product. The expected acquisition will not be a fire sale like we saw with Panther Express and Grid Networks as acquiring Velocix is more about getting access to their Metro technology and platform rather than their CDN contracts.

When contacted, Velocix declined to comment on any potential M&A activity, but did say that since announcing their Metro CDN enablement solution for ISPs in December last year, there has been a significant increase in the level of interest in their business. I expect we'll see the acquisition take place sometime in this quarter.

Comments

[Drew Robertson]

Dan You could do a great service to the memory-challenged parts of your audience who can't remember which companies were bought by whom and then rebranded what by creating a reverse family tree with the VC-overfunded branches feeding the trunk of consolidation. Be a nice handout in NYC next week.
Thx.

[Dan Rayburn]

Hi Drew, I already do this now at www.cdnlist.com where I list who got acquired, merged or went under.

If you mean doing this for all of the CDNs over the past ten years, it would be neat to have, but would take days to do all the work in detail. Also, simply having a list of who bought who is not really very valuable. The real value is learning from the past of why one company bought another, if it made any sense, what happen to the business and what we can learn from it. That is what I try and do with the blog.

[Rob Powell]

Seems like Verizon and Level 3 would be the obvious buyers, but might Cisco's rumored CDN moves fit somehow? A Cisco-Velocix pairing has some disruptive logic to it.

[Shhh]

I'd heard a whisper it would be Alcatel Lucent... shhhh

[Lalit]

The whispering was right and the rumour was wrong. Regards