Content Delivery Provider Velocix Close To Being Acquired, Telco Most Likely

Last month I started hearing whispers from the banking community that content delivery network Velocix was close to being acquired with multiple parties interested. I can now confirm that Velocix is in fact negotiating the sale of the company with at least two interested parties at mid to late stages of the process.

While I am not giving out any more details on who those two companies may be, I can say that various companies in the telco and network equipment community have shown interest in Velocix, primarily for their recently announced Metro product. The expected acquisition will not be a fire sale like we saw with Panther Express and Grid Networks as acquiring Velocix is more about getting access to their Metro technology and platform rather than their CDN contracts.

When contacted, Velocix declined to comment on any potential M&A activity, but did say that since announcing their Metro CDN enablement solution for ISPs in December last year, there has been a significant increase in the level of interest in their business. I expect we'll see the acquisition take place sometime in this quarter.