Canadian cable multiple-system operator, Shaw Communications Inc. (SJR), has sealed its previously declared acquisition of ViaWest Inc. for $1.2 billion. The acquisition of this Colorado-based data-center provider will help Shaw Communications expand its data services and cloud capabilities business.
ViaWest has 27 data centers in eight western U.S markets which include the likes of Dallas, Denver, Las Vegas and Minneapolis. The company has grown significantly from its initial presence of mere five data centers in two markets. ViaWest will continue to operate from its Denver headquarter as a stand-alone entity under Shaw Communications. Currently, ViaWest has in an excess of 350 employees and provides services to more than 1,300 customers.
Shaw Communications believes the acquisition of ViaWest will help the company boost its operations in the North America data center sector. According to IT research and consulting company 451 Research, the North American data center market is expected to grow by 32% to $14.8 billion from 2014–2016.
In the recently concluded third quarter of fiscal 2014, the company’s total revenue rose 1.2% year over year to approximately $1,219.7 million. We believe the acquisition of ViaWest will further boost Shaw Communications’ top line in the coming quarters as the company intends to capitalize on the vast opportunity available within the North American data center market.
Shaw Communications carries a Zacks Rank #3 (Hold).
Other Stocks to Consider
Investors interested in the related industry may consider stocks like Cablevision Systems Corp. (CVC), Comcast Corporation (CMCSK) and Telef (TEF). Cablevision Systems and Telef sport a Zacks Rank #1 (Strong Buy), whereas Comcast holds a Zacks Rank #2 (Buy).
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