Posted on August 7th, 2010
Two giants of the web hosting world Softlayer Technologies and The planet are right now contemplating over a merger; if the merger materializes the result could be the formation of the largest commercial entity which provides web hosting and cloud computing services.
This new company would have an established clientele of around 25,000 customers and supervise more than 78,000 servers worldwide. The newly formed company which is based in Dallas would be helmed by Softlayer Chief Executive Officer Lance Crosby. He will also continue to operate the planets office Houston based headquarters. Both the companies have major stakeholders from the private equity firm called GI Partners, who are expecting this monumental transaction to take place in the fourth quarter of this fiscal year.
Renovating The Industry Through Automation
This merger is a part of a chain event that has taken over the industry; the customers are becoming more aware of the advantages of automation and are diverting their hosting needs from conventional hosting. Automation provides improved adaptability and other management tools which are not found in conventional hosting methods. According to Crosby, the long term goal behind this merger is to shift The Planets enormous amount of dedicated servers and customers who are availing hosting services to the automotive Softlayer platform.
Crosby cites that “We have a unique opportunity,” “When we built SoftLayer, our ambition was to build a platform that could scale globally. We envisioned SoftLayer would have hundreds of thousands or millions of servers around the world. This merger will accelerate that process.”
The finalization of the transaction was made public after two days when softlayer declared that GI Partners had purchased major controlling stake in the company, and might even takeover altogether. According to Crosby this resulted in serious discussions as to how The Planet might adjust with Softlayer.
The CEO of The Planet, Doug Erwin was quoted as saying that he and his team are working meticulously to make the merger materialize and form a combined entity the likes of which have never been seen.
Hassel Free Automated Services
“Softlayer has invested majority of its corporate time in inventing tools to assist customers manage their products effectively” Erwin declared. “The customer will procure a hassle free, more streamlined and automated service. This service will enable us to broaden our horizons geographically and distribute our data centers from any place conceivable. When the customers have the combined network of The Planet and Softlayer it’s a win win situation for them”
This merger is no easy feat, Erwin confessed. He spearheaded the before the merger, process of integration of The Planet and EV1 Servers after GI Partners had taken over both companies in 2006. “The thing that caused us the most trouble was that the present system was relying on three separate servers” said Erwin. “It takes away malleability, after much painstaking efforts we limited ourselves to one system but it took four years”, compared to this the transition to Softlayer’s system will be relatively smooth and easy”.
Bain Will Lend A Helping Hand For Integration
The man in charge of directing the whole integration process will be Softlayer’s Chief Strategy Officer George Karidis. According to Erwin, a third party company named Bain & Company has been put on the payroll to construct a procedure which would facilitate fluid transition systems, customers and employees.
“We are aware that our automation and provision capabilities are accompanied by considerable growth margin”, said Karidis.
Erwin of The Planet seconds this statement of Karidis adding that magnitude of new entity provides advantage. “The industry is growing exponentially” he said. “We will most likely enhance the size of both the companies by two folds in upcoming 2 years. Backed with 75,000 servers, it puts tremendous buying power at our disposal and we can virtually buy anything from servers, network equipment everything. We also accumulated some great talent on both sides. It is a most opportune scenario.”
Crosby hopes to figure out many aspects of staffing and transition in the up coming months.
“This was made public to give our existing customers a head start and to lessen the apprehension and come to terms with some of rumors that were circulating”. Said Crosby
“At this moment we haven’t resolved every issue but as soon as we do it shall be made public and communicated”.