Jan 18 Shares of CyrusOne Inc rose as much as 15 percent on their market debut after the data center operator priced its offering at the higher end of its expected price range.
CyrusOne, owned by telecom company Cincinnati Bell Inc , priced its offering of 16.5 million shares at $19 each, raising $313.5 million. At the offer price, CyrusOne has a market valuation of about $1.18 billion.
Data centers provide equipment, space and bandwidth on a rental basis and provide connections for data to move across the world.
Upon completion of the offering, Cincinnati Bell will own about 71.6 percent of CyrusOne.
Texas-based CyrusOne has structured itself as a REIT, joining a string of technology companies looking to save on tax through the structure.
Companies with large real estate assets eye a REIT structure as it helps reduce the tax burden on their rental income. Shareholders also stand to gain as REITs are required to distribute at least 90 percent of their profits as dividends.
Morgan Stanley and BofA Merrill Lynch were acting as joint-bookrunners to the offering.
CyrusOne shares rose 14 percent to $21.85 on Friday morning on the Nasdaq, while Cincinnati Bell's shares were down 2 percent at $5.19 on the New York Stock Exchange.