DCK Investor Edge: Small, private-company mentality is out; a new, market-driven super-wholesale focus is in.
Like Schrodinger’s Cat, both dead and alive at the same time, RagingWire is both publicly traded and isn’t. Its parent, the Tokyo-based giant NTT Communications, trades on the public market and reports quarterly earnings, but those earnings don’t detail RagingWire’s results. Analysts don’t get to grill the US data center provider’s CEO Doug Adams on an earnings call once every three months.
NTT has been Reno, Nevada-based RagingWire’s parent since it bought an 80-percent stake in 2014. It acquired the remaining 20 percent last year. NTT is one of the largest multinational telecommunications and data center companies, providing services in 190 countries and regions. According to the latest estimate by Synergy Research Group, released this week, NTT is the world’s third-largest data center colocation company, behind Digital Realty Trust and Equinix, the market leader.
Most of NTT’s 6-percent share of the global market consists of retail colocation, with RagingWire contributing to the sliver of revenue that comes from wholesale colocation. The access to low-cost capital that comes with being owned by NTT – a weighted average cost of 1 percent – gives RagingWire a huge advantage when it comes to penciling out super-wholesale deals.
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