2020 data centre M&A surpasses $30bn in deal value

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The value of data centre M&A deals that closed in the first eleven months of 2020 exceeded $30 billion, according to the latest data from Synergy Research Group.

The new record exceeds the previous annual record set in 2017 as well as in 2019. With a number of potential December deals still on the table, Synergy found that 2020 has so far seen 113 deals closed at a total value of $30.9 billion.

Specifically, it says that while the $8.4 billion acquisition of Interxion by Digital Realty helped to boost the 2020 number, five other billion dollar-plus deals have closed so far this year, plus there was a $2 billion secondary share listing.

“There is no doubt that this has been a bumper year for data centre M&A activity, despite Covid-19 inevitably slowing down some transaction and due diligence activities” said John Dinsdale, a chief analyst at Synergy Research Group.

“We are also aware of almost $7 billion in deals and IPOs that are at various stages of closing, so the pipeline remains robust despite the flurry of activity in 2020. This drive to find new sources of investment capital is being fuelled by an almost inexhaustible demand for data centre capacity.”

As of 2015 Synergy has identified 483 closed deals with a total value of $107 billion. Over that period the total deal value has been split between public companies and private equity buyers, with private equity buyers accounting for 59% of the deal volume.

Since 2015 the largest deals to be closed are the acquisitions of Interxion and DuPont Fabros by Digital Realty, the acquisition of Global Switch by a group of Chinese investors and the acquisitions of Verizon data centres and Telecity by Equinix.

For the same 2015-2020 period, the largest investors have been Digital Realty and Equinix. In total they account for 31% of total deal value over the period.

Other notable companies who have been frequent acquirers include Colony, CyrusOne, GDS, Digital Bridge/DataBank, Iron Mountain, NTT, GI Partners, Carter Validus, QTS and Keppel.