Verizon to buy Terremark for $1.4 billion
A day after Verizon Communications noted that cloud computing is a key cog in its growth strategy, the telecommunications giant said yesterday it has signed a deal to acquire Terremark, which provides cloud services and data center hosting.
The $1.4 billion price tag for Terremark works out to be $19 a share in cash. Terremark closed at $14.05 yesterday before the acquisition was announced. In many respects, the Verizon move makes a lot of sense. Miami-based Terremark is a much less expensive takeout target than Savvis or Rackspace would be for Verizon. Meanwhile, Verizon can use its army of sales people--remember MCI is part of the company--to sell cloud services.