Private equity aims high with Zayo owners targeting $31bn
The appetite for private-equity investment is seeing a new peak with both the private-equity owners of Zayo setting record targets for their latest funds.
DigitalBridge, the US company that owns 50% of Zayo, said it has closed its second flagship fund with commitments of US$8.3 billion, surpassing its original target of $6.0 billion.
Meanwhile Swedish investor EQT, which owns the other 50% of Zayo, says it has set a target for its latest fund of €20 billion for its fund. That sum is equivalent to $22.7 billion, almost three times as much as DigitalBridge’s total, meaning the two funds together add up to $31 billion.
DigitalBridge said its new fund – officially DigitalBridge Partners II – received strong demand from a diverse, global group of new and existing investors.
Marc Ganzi, president and CEO of DigitalBridge, said: “We are pleased to have completed the close of our second and largest fund to date, which significantly exceeded our initial target.”
He said that “the solid support” the fund received from investors “is a testament to their confidence in our experienced team, unique investment strategy and the compelling opportunities ahead in digital infrastructure”.
The fund has already invested in nine portfolio companies in sectors such as towers, hyperscale data centres, edge infrastructure, indoor digital infrastructure and fibre, with users such as hyperscale cloud providers and mobile network operators.
In Sweden, EQT has not specified where its new fund, called EQT X, will be spent. The investor said: “The actual fund size is dependent on the outcome of the fundraising process and may ultimately be higher or lower than the target size.”
However, the investor said that EQT X would be “materially in line with predecessor fund EQT IX”, which was launched in 2020 and raised €15.6 billion.
That had a diverse range of investments, including software-as-a-service as well as energy and health.
DigitalBridge and EQT completed their $14.3 billion acquisition of Zayo in March 2020, a few years after conceiving the project at a meeting at Capacity Media’s Metro Connect conference in Florida. This year’s Metro Connect takes place on 31 January to 2 February in Miami.