The Company: Peer 1 Networks

In 2004, Celerity led a $32 million minority leveraged recapitalization of Peer 1, a subscale hosting services company with two small colocation facilities in downtown Vancouver with approximately $20 million in revenues and less than $2 million in EBITDA. Simultaneously with the recapitalization, we acquired the hosting services division of Interland, which instantly increased the earnings of the company by five times and gave it data centers across the U.S. and Canada. Within 45 days from the execution of the Letter of Intent, we closed on the Peer 1 recapitalization, acquired the Interland assets and brought to the table and closed the debt financing with Fortress. When we exited four years later, Peer 1 had scaled to approximately $100 million in revenues and $28 million of EBITDA.

The Executive: Geoff Hampson

Geoff is a multivariate international businessman and investor who has served as a chief executive in companies in a wide variety of sectors. He is currently Chairman of Fibrox, a manufacturer of residential and commercial insulation in which he is a majority shareholder, and Chairman of a large assisted care living company based in Orlando, Florida and a control shareholder of LNB, a road and bridge infrastructure construction company based in British Columbia. At Peer 1, over a five-year period, with no prior experience in hosting services, he grew revenues from approximately $2 million to $100 million.

What He Said About Us:

“As CEO, I built a strong team at Peer 1, which had grown organically from a cold start in late 2000. By the time we met Celerity in 2004, we had identified a ripe environment for acquisitions as the data center and managed services business was highly fractured and companies were trading at very low multiples. We looked at our industry in the same way investors might look at leases; recurring revenue, long term contracts and very low churn.

Before we had actually entered into a formal agreement, Celerity accompanied me on a trip to Atlanta to make an offer to acquire the assets of Interland, Inc. At that meeting, we were successful in reaching an agreement to purchase the business, which had $10.5 million of TTM EBITDA, for a cash price of $14 million. The Celerity team’s advice and skills were instrumental in getting that deal done. Several acquisitions followed, with the Peer 1 ultimately being sold in 2013 for $565 million. The Celerity team’s quick study and decision making ability were critical in building Peer 1 into the leader it is today. Celerity’s ability to quickly recognize the opportunity, back management’s vision and execute on the deal were key to our success.”