Exodus Communications Case Study
At the height of the dot-com explosion, Exodus Communications, Inc., an international web hosting firm based in Santa Clara, California boasted an impressive client list: eBay, Microsoft Hotmail, Google, Lycos, Providian and Handspring to name a few. The Company acquired rival GlobalCenter in late 2000 to make it the leader in Internet infrastructure services. The company had data centers throughout the US, Canada and Europe. However, the company's stock lost 98% of its value when the bottom fell out of the technology market. In September 2001, the company filed for Chapter 11 bankruptcy protection with over $3 billion in debt.

Why DCI?
DCI (under predecessor name Venture Asset Group) was hired by Exodus to sell their physical assets as well as their venture capital and intellectual property portfolios. DCI's unique skill set enabled Exodus to retain only one firm to handle all of their strategic objectives. The company was committed to obtaining maximum recovery for its creditors and DCI was the answer.

The Details:
Exodus sold approximately 2/3 of their data center holdings (30+/-) to Cable and Wireless PLC. Dan Schryer and Spencer Mullee of DCI handled the sale of the remaining 15 Internet Data Centers (IDC). Two of the representative sales were to Dell Computer and Freddie Mac. Together, the two centers represented over 200,000SF of space and an original investment of over $100 million.

Tom Todaro marketed the Exodus portfolio of 17 venture capital investments. The portfolio consisted of investments made in 1999 and 2000 that were once valued over $200 million. Within Exodus' venture capital portfolio, DCI performed a range of functions that included the liquidation of holdings in venture-backed and now-public companies, terminating positions in defunct enterprises and most importantly sales of companies and positions to strategic buyers identified through DCI's proprietary sales process.

Challenges and Results
Challenges:
The Exodus assignment included over $1 billion in physical assets, venture investments, IRU's and intellectual property. At the start of the project, documentation was all but non-existent. Intensive due diligence was necessary to rebuild documentation for prospective buyers. Former employees were contacted for information on unanswered questions, and hundreds of calls to potential buyers led to competitive bids which maximized recovery.

The Results:
The combined value of the sales DCI led exceeded $60 million, making this the second largest recovery for the creditors of Exodus after the sale of the on-going data center business to Cable and Wireless PLC.