The number of data center-oriented M&A deals closed in the first nine months of the year has reached 140 with an aggregate value of $30 billion, Synergy Research Group said.
There is an additional $17 billion of pending data center deals in the pipeline that have been agreed but have not yet officially closed, most of which are expected to close before year end.
The year 2022 could end up matching the record-breaking data center M&A activity levels that were seen last year. Synergy logged 216 deals that closed in 2021 with an aggregate value of over $49 billion, 42 percent up from the 2020 total of $34 billion, which itself was a record year at the time.
In the 2015-2018 private equity buyers accounted for 42 percent of data center deal value. In 2019 to 2021, private equity share of the total deal value increased to 65 percent, while in the first three quarter of 2022 private equity share has jumped to over 88 percent.
The highlights for this year have been the $15 billion acquisition of CyrusOne by investment firms KKR and Global Investment Partners, and the pending acquisition of Switch by DigitalBridge for $11 billion.
The 2021 highlights were the acquisitions of CoreSite and QTS, each for around $10 billion. These deals represent the four highest value acquisitions the industry has ever seen.
All four acquired companies feature in the worldwide top 15 ranking of colocation operators, while they are ranked three through six in the US market, behind only Equinix and Digital Realty.
Prior to these four record-setting transactions, the biggest data center M&A deals were Digital Realty’s $8.4 billion acquisition of Interxion, Digital Realty’s $7.6 billion acquisition of DuPont Fabros, the Equinix acquisition of Telecity for $3.8 billion, the Equinix acquisition of Verizon’s data centers for $3.6 billion and the acquisition of Global Switch by the Jiangsu Shagang Group of China, which was valued at over $8 billion in transactions that were spread over three years.
Some of the most notable serial acquirers have been Equinix, Digital Realty, EQT, DigitalBridge/Vantage, CyrusOne, GDS, GI Partners, Keppel, Macquarie, Mapletree and NTT.