The London Fund, a real assets investment vehicle set up by UK local government pension schemes (LGPS), is investing in a data centre platform via a co-investment with Macquarie Asset Management.
Local Pensions Partnership Investments said The London Fund has agreed to invest alongside Macquarie’s acquisition of a significant minority stake in VIRTUS Data Centres. Financial details were undisclosed.
In August last year, Singapore-headquartered ST Telemedia agreed to sell the stake in VIRTUS to the Macquarie European Infrastructure Fund 7 fund.
Established in 2008, VIRTUS provides colocation and cloud connectivity services. The company’s portfolio comprises 11 data centre facilities in Greater London with a combined capacity of over 180MW, and an initial 100MW pipeline of projects under consideration in prime locations across the UK and Europe.
The deal represents The London Fund’s first infrastructure investment and the fund’s fourth major investment.
Richard Tomlinson, chief investment officer, Local Pensions Partnership Investments, said: “Digital infrastructure has been driven by long-term tailwinds including growing data consumption and the development of cloud computing and VIRTUS’s success is a testament to this.
“With this investment, we’re pleased to be supporting a key global player in a rapidly growing sector, enhancing London’s digital ecosystem, whilst also proving that commercial success and a commitment to net zero can be compatible business goals.”
Vanessa Shia, the head of private markets at London CIV, said: “We are delighted to have partnered up with Macquarie in our co-investment in VIRTUS through The London Fund. This builds on our continual focus to making critical investments in London and greatly complements our existing portfolio.
“This is one of our first direct investments in the digital infrastructure space and, given the essential role it plays in supporting global connectivity by offering an alternative to travel and commuting, represents a pivotal investment on behalf of our clients in their journey to net zero.”
Phil Peters, the head of Macquarie Asset Management’s client solutions group, said: “We are very pleased to be extending our existing partnerships with LPPI and London CIV, the collaborators of The London Fund, with this co-investment in VIRTUS Data Centres alongside our managed funds.
“The London Fund’s objective of investing in assets that have positive benefits for Londoners very much aligns with our responsibility and opportunity to drive positive change for all our stakeholders through our investments.”
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