Upbeat Telecity eyeing M&A in new markets

BANGALORE/LONDON (Reuters) - Data-centre firm Telecity Group (TCY.L) increased its firepower for acquisitions in new and existing markets in Europe, as it reiterated its positive outlook on buoyant demand for storage capacity.

Chief Executive Mike Tobin said in an interview on Monday he had identified opportunities for bolt-on deals to drive growth beyond the group's already ambitious expansion plans.

"We are doubling our entire footprint over the next three years," he said.

"But in addition to that there are opportunities, if we can get the right deal at the right price, for bolt-on acquisitions of facilities in our existing markets as well as new markets in Europe."

The group, which operates 24 data centres in major European cities, secured an additional 100 million pounds of debt financing, taking its total credit facility to 300 million pounds.

Tobin said the available funds would allow the group to move quickly on deals, potentially in new markets like Eastern Europe.

"Looking forward, there is still significant growth for us to capture, both in our existing markets and in new markets in Europe, as the Internet continues to grow and the Cloud increases in significance," he said.

Cloud computing technology helps companies store their data at remote data centres that can be accessed over the Web.

Analysts on average are expecting the company to post a pretax profit of 63.3 million pounds on revenue of 231.8 million pounds for the year ending December 31, 2011, according to Thomson Reuters I/B/E/S.

Telecity's shares, which have risen 7.5 percent since February when it reported a 45 percent rise in adjusted pretax profit for 2010, were 0.7 percent lower at 527 pence at 9:51 a.m. British time. (Editing by Maju Samuel and Will Waterman)