CityReach raises $155 million third round

London-based CityReach International, which aims to have 20 Secure Internet Exchanges (SiXs) in place in 12 European cities by the end of next year, at the beginning of September closed its third and largest financing round.

Investcorp led an investor group that provided $155 million; other participants in the round included existing shareholders Morgan Grenfell, Merrill Lynch and Vulcan Ventures. CityReach had already raised $46 million of equity funding in two earlier funding rounds from groups including Battery Ventures, Chase Capital Partners, Vulcan and Merrill Lynch Venture Partners and in July agreed a $133 million senior credit facility with Merrill Lynch. Merrill Lynch International was the agent for the placing, which is intended to support CityReach through to its IPO, which is scheduled for next year.

CityReach’s SiXs offer hosted facilities for finance, e-commerce and telecom companies. As well as being highly reliable CityReach guarantees a maximum of eight minutes of server downtime per annum the SiXs are extremely secure, featuring protection systems similar to those employed by the US military.

The first CityReach centre opened in Amsterdam in April, and its London centre is due to come on stream by the end of September. SiXs for Berlin, Brussels, Budapest, Dublin, Hamburg, Munich, Paris and Stockholm are in the pipeline.