Telecom Ramblings

Colocation and interconnection specialist Telx raised a tidy sum of $43.5M this week.  The new financing is being provided by CIT Communications, Media & Entertainment and RBC Capital Markets and both replaces an existing loan and adds new capital for expansion.  This seems like a further indication that the credit markets continue to thaw.  Money is available, though I’m sure it’s still not cheap.

As a private company, we don’t get to hear too much about Telx.  But like other datacenter providers they have been enjoying rapid growth, with Q1 being 39% above the same period last year.  I’m sure that growth has been tempered by the economy over the last few quarters, but as with the rest of the sector demand is surely still healthy.  What Telx might do with the money isn’t clear, but there are really two directions they can choose to funnel the money:  into managed services and the cloud like Terremark, or into more colocation space to take advantage of the looming shortage in space.