Black Box Inks Deal With 'Social Media Giant'

Black Box has inked a $10 million deal with a yet-to-be-named "social media giant" to build out a massive data center, with the project potentially totaling $300 million or more for the Lawrence, Pa.-based solution provider.

The deal comes after Black Box Monday warned in a regulatory filing that it may not have enough cash to make it into next year without filing for bankruptcy.

"This strategic partnership has the potential to be one of the largest in Black Box history," Joel Trammell, Black Box president and CEO, said in a statement. "The ability to deploy sophisticated data center solutions leverages our intelligent digital edge strategy. Our global scale, repeatable and predictable governance framework, deep technical expertise, and core values alignment differentiated us from our competition and were instrumental in our selection. We look forward to a successful project delivery for this first U.S. data center, and are excited to continue and expand our journey together with our partner."

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Black Box will build out a 1-million-square-foot space, installing the racks and stacks of network equipment, installation of the infrastructure hardware, and all of the structured cabling, which includes more than 100 miles of fiber-optic cabling. The company also will deploy a dedicated project team, ramping up to 70-plus team members for the first project and could see that number grow to over 500 team members as the program reaches its potential, according to the Black Box statement.

In its announcement, Black Box said this initial deal marks the beginning of a five- to 10-year strategic relationship with the "social media giant," which it said is planning a "very aggressive" global data center expansion program. Conversations are already under way between Black Box and the social media company to add additional site locations and data centers, the company said.

Following Monday's announcement, Black Box's share price fell below $1. Shares are rebounding Friday, as the stock is up some 65 percent in early trading.