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Fly News Breaks for February 12, 2020
Feb 12, 2020 | 13:14 EDT
Wells Fargo analyst Eric Luebchow says that in a meeting last October, CyrusOne CEO Gary Wojtaszek openly discussed the numerous advantages of being a private company. The willingness to sell is there, it just comes down to price, Luebchow tells investors in a research note after TMT Finance reported that CyrusOne has hired bankers after receiving takeover interest. Last year, the analyst thought the company could potentially sell in the $85-$90 per share range, and his understanding is that potential acquirers could not meet that target. Given CyrusOne's recent commentary that U.S. hyperscale demand remains muted, Luebchow now believes a more appropriate range for a potential take-private transaction would be $75-$80 per share. CyrusOne in afternoon trading is up 8%, or $5.05, to $67.45. Luebchow keeps an Overweight rating on the shares, noting CyrusOne's recent workforce reduction initiative should boost its profitability going forward, "which could be attractive to an acquirer."
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