Investors take 25% stake in Global Switch for £2.1bn
Data centre operator Global Switch is now valued at more than £8 billion after a consortium of Asian investors took a 24.99% stake for £2.1 billion.
The investment is by Strategic IDC – nothing to do with the market research company IDC, but a consortium of existing investors, mainly from China, plus new shareholders including China CITIC Bank International, which is providing debt funding to Strategic IDC.
Global Switch CEO John Corcoran said: “This investment from both new and existing investors, is a clear endorsement of our strategy as we move towards listing Global Switch on an international stock exchange and seek to successfully extend our market leadership positions across Europe and Asia as the data centre provider of choice for new customers from across the globe.”
The company said there will be no change to its strategic direction, management or financial and operational policies. The investment is seen as a precursor to a plan by Global Switch to seek a stock market quotation next year. Global Switch says it will be “on a leading international stock exchange in Europe, Asia or North America” and adds the “subject to market conditions” proviso.
Global Switch makes the point that it “is essentially a real estate company”, adding: “It simply builds and operates high quality, technical real estate with the right power, cooling and physical security required by IT service providers.”
The controlling shareholder, with a 51% stake, is a company called Elegant Jubilee, a consortium of institutional and private investors from Asia that came into the business in December 2016. The other 24.01% belongs to Aldersgate Investments, a vehicle of private equity investors Reuben Brothers, whose other interests include property companies racecourses, pub companies and an airport and a heliport.
The new investment is made up of £1.8 billion for the shares in Global Switch and £300 million to Aldersgate Investments. As part of the transaction, Li Qiang, the chairman of Global Switch, will increase his personal stake in Global Switch from 0.7% to 4.8%. He said: “The investment from Strategic IDC is a testament to both the quality of the company and the tremendous strategic progress Global Switch has continued to make over the last 12 months.”
Aldersgate Investments director Alexander Bushaev said: “Having first invested in Global Switch in 2006 and supported its global growth and development during that time, we are very pleased to see the company going from strength to strength more than 12 years on.”