Vantage Data Centers has announced it has been acquired by a consortium which includes Digital Bridge Holdings, LLC, a leading global communications infrastructure company, Public Sector Pension Investment Board (PSP Investments), and TIAA Investments (an affiliate of Nuveen), which made the investment on behalf of TIAA’s general account. Financial terms of the private purchase from Silver Lake were not disclosed.
Founded in 2010 in the heart of Silicon Valley, Vantage’s customer base includes the world’s leading cloud service providers and large enterprises. With four data centers on the flagship Santa Clara campus, two more under construction, and a second large-scale campus under development, Vantage has the largest wholesale data center footprint in Silicon Valley. The company has built 51 megawatts of IT load in Santa Clara and has secured expansion capacity totaling 93 megawatts of IT load. The company also owns and operates a data center campus in Quincy, Washington, including a 6 megawatt data center and additional expansion land and power in that market. Vantage is well positioned for continued growth in the industry, with plans to significantly expand its data center footprint in existing and new markets.
“Vantage is one of the highest quality businesses I have encountered in more than two decades of investing in the sector,” stated Marc Ganzi, co-founder and CEO, Digital Bridge. “This is a unique and special opportunity to invest in a company that has operational excellence, quality customers, and a current lease portfolio with long duration. It also has significant expansion capacity in Silicon Valley, perhaps the best data center market in the U.S.”
Vantage will continue to be led by president & CEO Sureel Choksi and the existing management team, each of whom has made an investment in the business alongside the consortium. In connection with the transaction, Mike Foust, senior advisor to Digital Bridge and former CEO of Digital Realty, will join the Vantage board of directors as Chairman, and Raul Martynek of Digital Bridge will also join the board.
“We’re incredibly proud of what the Vantage team has achieved by providing flexible solutions to our customers and delivering an industry-leading service experience,” said Choksi. “We’re thrilled about the opportunities to serve our customers’ future expansion plans going forward. We have been fortunate to have had a great partner in Silver Lake, and are excited to partner with Digital Bridge, PSP Investments and TIAA Investments as we enter this exciting new phase of the company’s growth.”
“We are confident that Vantage is ideally positioned to successfully deploy its winning expansion strategy, and look forward to supporting the company’s top tier management team,” said Daniel Garant, executive vice president and chief investment officer at PSP Investments. “Vantage’s leading market position, in a sector which we believe will grow significantly in the coming years, makes it an attractive investment for PSP Investments.”
“This communication infrastructure investment represents a growing and attractive asset class within TIAA’s infrastructure portfolio,” stated Marietta Moshiashvili, managing director & head of infrastructure asset management for TIAA Investments. “Partnering with the successful Vantage management team and this group of investors will strengthen the firm’s expansion plans and position in the marketplace, generating what we believe will be significant value for all parties.”
“Silver Lake is proud to have supported Vantage’s vision and accomplishments since inception,” said Greg Mondre, managing partner at Silver Lake. “From a standing start seven years ago, the company has become a leading wholesale data center provider, with an established platform for long-term growth.”
RBC Capital Markets and DH Capital served as financial advisors, and Simpson Thacher & Bartlett LLP acted as legal advisor to Vantage in connection with the transaction. Jones Day acted as lead M&A counsel, Kleinbard LLC acted as investment structure counsel, and Ernst and Young LLP served as accounting advisor to Digital Bridge. Davies Ward Phillips & Vineberg LLP acted as legal advisor to PSP Investments, and Arnold & Porter Kaye Scholer LLP acted as legal advisor to TIAA Investments. TD Securities together with CIT Bank, N.A., RBC Capital Markets, and SunTrust Robinson Humphrey provided debt financing commitment for the acquisition.