Blackstone Infrastructure Partners, Blackstone Real Estate Income Trust and other unnamed funds managed by the private-equity giant are buying listed QTS Realty Trust in a deal that values the data-centre operator at $10bn (€8.22bn).
The all-cash acquisition at $78 per share, which includes the assumption debt, will take the NYSE-listed company private and give Blackstone investors ownership of 7m sqft of mega-scale data-centre space in North America and Europe.
QTS said the purchase price represents a 21% premium to its closing share price on 4 June and a 24% premium to the volume-weighted average share price of the past 90 days.
The transaction was unanimously approved by the QTS board of directors and is expected to close in the second half of the year.
Data centres have long attracted real estate and infrastructure investors, and the deal brings together Blackstone’s multi-billion-dollar open-ended infrastructure fund, its non-listed real estate investment trust and a number of its “other long-term perpetual-capital vehicles”.
“We are delighted to back QTS and its world-class management team as they continue to scale the company to meet the rising demand for data centres,” said Greg Blank, senior managing director of Blackstone Infrastructure Partners.
“QTS aligns with one of Blackstone’s highest conviction themes – data proliferation – and the required investment makes it well suited as a long-term holding for our perpetual-capital vehicles.
“We are committed to a strong, lasting partnership, leveraging Blackstone’s scale, reach, resources and access to capital to drive long-term growth at QTS.”
Tyler Henritze, head of acquisitions Americas for Blackstone Real Estate, said: “We are focused on investing in assets that are benefiting from strong, secular tailwinds, such as the rapid digitalisation of data.
“QTS is a leading provider of data-centre solutions with a portfolio of high-quality assets in desirable markets, positioning it well to capitalise on these powerful trends in the data-centre space.
“We believe the vast expertise across our business will enable the QTS platform to succeed over the long term.”
QTS said it expected its senior management team to remain in place and be able to maintain its corporate headquarters in Overland Park, Kansas.
“We are pleased to enter into this transaction with Blackstone, as it will deliver compelling, immediate and certain value to stockholders while positioning QTS to continue supporting customers’ expanding data center infrastructure needs,” said Philip Trahanas, who leads the QTS board of directors.
“The QTS board regularly reviews the company’s strategy and market opportunities to maximise stockholder value, and we are confident this transaction achieves that objective.”
Chad Williams, chairman and CEO of QTS, said: “QTS is powered by its people and continues to set a new standard for service delivery in the data-centre industry.
“We see a significant market opportunity for growth as hyperscale customers and enterprises continue to leverage our world-class infrastructure to support their digital transformation initiatives.
“We are confident this transaction is the right step to achieve our strategic objectives in our next phase of growth.”