Cincinnati Bell has announced that CyrusOne Inc., the wholly owned subsidiary that owns and operates Cincinnati Bell's data centre business, has filed a registration statement on Form S-11 with the Securities and Exchange Commission in connection with CyrusOne's proposed initial public offering of its common stock. A portion of the proceeds from the initial public offering will be used to repay outstanding indebtedness of CyrusOne owed to Cincinnati Bell. Morgan Stanley & Co. LLC and BofA Merrill Lynch will act as joint book-running managers.
Reports suggest that the company intends to raise up to US$300 million, and then reposition itself as a real estate investment trust (REIT). Cincinnati Bell said in May, that it was planning the potential IPO, and looking at options for restructuring its hosting and data centre property, including structuring it as a REIT.
In addition, Cincinnati Bell announced its financial results for the second quarter of 2012. For the quarter, revenue was US$368 million, comparable to the second quarter of 2011 and improved from US$363 million generated in the first quarter of 2012. Operating income for the quarter was US$65 million compared to US$78 million in the second quarter of 2011.
"The success of CyrusOne and Fioptics continues to be a strong catalyst for the growth in Cincinnati Bell's revenue and Adjusted EBITDA despite the challenges of ongoing access line and wireless subscriber losses," said Jack Cassidy, president and chief executive officer. "This success helped to generate our highest first half revenue since 2003, and keeps us on track to meet our guidance for 2012." For the quarter, data centre colocation revenue of US$54 million increased 20% compared to the second quarter of 201. At the end of the quarter, the segment had 801,000 sq ft of total data centre capacity and utilization was 85%.