Vantage Data Centers, Colony Capital Agree to Form $3.5B Partnership to Grow Data Center Platform
DENVER AND LOS ANGELES — Data center developer and operator Vantage Data Centers has entered into a definitive agreement with an investor group led by Colony Capital Inc. (NYSE: CLNY) to form a $3.5 billion partnership that will expand Vantage’s data center platform in North America and Europe. The firms expect the agreement to be finalized toward the end of the month.
As part of the agreement, the Colony-led investor group will invest $1.2 billion in Vantage’s portfolio, including 12 stabilized North American data centers that span more than 1.4 million gross square feet in Santa Clara, Calif.; Quincy, Wash.; Montreal; and Quebec City, Canada.
Vantage’s management team, led by President and CEO Sureel Choksi, will continue to manage and operate these assets as part of its global data center footprint.
The Colony-Vantage partnership will allow Vantage to develop and maintain top-performing data centers in new and existing markets. The Denver-based company has been expanding in Europe the past few months, entering Wales through its acquisition of data center campus Next Generation Data that was announced in April.
Vantage also acquired data center provider Etix Everywhere in February. The deal included a data center under construction in Frankfurt, Germany. Vantage has also purchased land in Berlin, Milan, Warsaw and Zurich with plans to develop new hyperscale data center campuses. The European expansion was funded in part by Digital Colony Partners, a subsidiary of Colony Capital.
The new Colony-Vantage partnership helps advance Colony Capital’s initiative to pivot its business model into more digital infrastructure. Last week, Colony Capital announced Marc Ganzi, co-founder and CEO of telecomm investment firm Digital Bridge and Digital Colony Partners managing principal, as the firm’s new president and CEO.
“As Colony continues to build momentum around our strategic transformation to digital infrastructure, this investment demonstrates our commitment to acquire high-quality digital assets on our balance sheet,” says Ganzi. Approximately $200 million of the Colony Capital’s investment in Vantage comes from Colony Capital’s balance sheet.
Citi served as Vantage’s financial advisor in the partnership agreement.
Colony Capital is a Los Angeles-based REIT that manages a $50 billion portfolio of real estate assets. The firm has 350 employees across 20 offices in 12 countries.
Colony Capital’s stock price closed on Monday, July 6 at $2.34 per share, down from $5.13 a year ago.
— John Nelson