THE billionaire Reuben brothers are gearing up for a £1.5 billion flotation of Global Switch, the data-centre company.

The pair, the tenth-richest entrepreneurs in Britain with an estimated £4.3 billion fortune, according to the latest Sunday Times Rich List, have held preliminary talks with UBS, Credit Suisse and Deutsche Bank in the past few months.

The listing could come as early as the second half of this year or the first half of next, depending on the credit crunch. David and Simon Reuben are thought to be weighing up whether to float in London, America or continental Europe.

The data-centre market is projected to enjoy huge growth in demand, spurred by regulatory requirements that have increased the need for companies to retain more data and back-up IT facilities as part of their disaster-recovery plans.

Data-centre providers provide customised space for firms to store servers and telecoms equipment.

Global Switch has debts of less than £100m and a float could raise up to £750m. The brothers are expected to retain a stake of between 40% and 60% in the business if they proceed with a listing.

Global Switch has data centres in London, Amsterdam, Paris, Frankfurt, Madrid, Sydney and Singapore covering more than 2.8m sq ft.

Since taking control, the pair have strengthened the management team, bringing in Matthew Giles to head Global Switch in Britain and Europe, with a power upgrade just being completed in London.

James Viciana, a veteran of the Reubens’ TransWorld Metals business, has been brought in to oversee the power project. The Asia Pacific arm is run by John Corcoran, a former director of property group Multiplex.

In the past two years Global has enjoyed rapid earnings growth. It generated positive cash flow for the first time in 2006, rising to £45m in 2007. This year it is expected to generate earnings of £80m and it is forecast to comfortably beat £100m in 2009.

Occupancy levels have soared from about 55% let in 2006 to an average of almost 80% across the portfolio today.

The data centres are attractive to the Reubens because they are leased to blue-chip companies, including IBM, Shell, BP and Microsoft. It is thought the brothers have invested more than £170m in expanding and upgrading the business in the past couple of years.

A float would cap a remarkable turnround for the operation, which suffered heavy losses after some of its principal tenants collapsed when the dotcom boom turned to bust.

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