• About Us
  • Partnership Opportunities
  • Privacy Policy

Data Center Frontier

Charting the future of data centers and cloud computing.

  • Cloud
    • Hyperscale
  • Colo
    • Site Selection
    • Interconnection
  • Energy
    • Sustainability
  • Cooling
  • Technology
    • Internet of Things
    • AI & Machine Learning
    • Edge Computing
    • Virtual Reality
    • Autonomous Cars
    • 5G Wireless
    • Satellites
  • Design
    • Servers
    • Storage
    • Network
  • Voices
  • Podcast
  • White Papers
  • Resources
    • COVID-19
    • Events
    • Newsletter
    • Companies
    • Data Center 101
  • Jobs
You are here: Home / 5G Wireless / Data-Driven M&A Expands Across Data Centers, Wireless, Fiber, Towers

Data-Driven M&A Expands Across Data Centers, Wireless, Fiber, Towers

By Rich Miller - May 14, 2019

Data-Driven M&A Expands Across Data Centers, Wireless, Fiber, Towers

Investors are looking to build broad-based portfolios of digital assets, including data centers, telecom towers, fiber and antennas. (Photos: Rich Miller)

LinkedinTwitterFacebookSubscribe
Mail

The digital transformation will create opportunities across a broad range of infrastructure. Investors are sharpening their focus on multi-sector strategies that spread investment across the entire spectrum of digital infrastructure assets, including data centers, telecom towers, wireless antennas and fiber.

That trend is clearly visible in two deals announced in in recent weeks: The acquisition of Zayo Networks by Digital Colony and EQT, and American Tower’s purchase of Colo ATL. These transactions continue the crossover between the wireless, fiber and data center businesses, a trend we first noted in our 2018 Forecast. This trend is bringing new investors into the data center sector, as they seek to balance the opportunities and valuations presented by the different classes of data-focused infrastructure assets.

The gradual emergence of edge computing and 5G wireless networks will enable new technologies that shift IT infrastructure outside of core markets, and require additional integration between data centers, telecom towers and antennas. Analytics for new technologies will require processing and storage, sorting oceans of sensor data into smaller datasets to send across the network.

Digital Colony to Acquire Zayo

Digital Colony may be a new name for some followers of the data center sector. But as with other recent market entrants, the company features an experienced leadership team and financial backers with deep pockets.

On Monday, Digital Colony teamed with Swedish infrastructure fund EQT Partners to acquire publicly-held telecom and data center provider Zayo Group and take the company private. The deal values Zayo at $35 a share, or about $14.5 billion, including the assumption of $5.9 billion of Zayo’s debt.

Zayo operates a 130,000-mile all-fiber network in North America and Europe, along with its zColo colocation business, which operates 51 data centers and more than 1 million square feet of data center space.

Digital Colony is a company formed by Digital Bridge and Colony Capital to acquire digital assets. Both Digital Colony and Digital Bridge invest across four key segments that define mobile and internet infrastructure – towers, data centers, small cells, and fiber – which each play an important role in digital transformation and how information is consumed.

Digital Bridge owns and operates two data center platforms – DataBank in retail colocation, and Vantage Data Centers in the wholesale/hyperscale space. Principals Marc Ganzi and Chairman Ben Jenkins previously founded Global Tower Partners (GTP), the largest privately-owned operators of telecom towers.

With Digital Colony, the Digital Bridge team is being backed by Colony Capital, a real estate investment management firm led by Thomas Barrack Jr., an experienced private equity executive.

“Zayo has a world-class digital infrastructure portfolio, including a highly-dense fiber network in some of the world’s most important metro markets,” said Ganzi. ” We believe the company has a unique opportunity to meet the growing demand for data associated with the connectivity and backhaul requirements of a range of customers. We are excited to work alongside the management team and EQT to grow the business and expand its presence in the global market.”

Free Resource from Data Center Frontier White Paper Library

agrotech
Technology Takes on Agriculture — the Role of Agrotech and Data Centers in Farming Success
Data centers have a role in enabling agrotech. And a new white paper from QTS focuses on this role. Small, remotely managed edge data centers will provide the proximity to rural areas to handle latency-sensitive, locally cached data requirements. Get the new report that explores how agrotech can help farmers be successful today and into the future. 
We always respect your privacy and we never sell or rent our list to third parties. By downloading this White Paper you are agreeing to our terms of service. You can opt out at any time.

Get this PDF emailed to you.

On May 1, Digital Colony finalized its acquisition of Cogeco Peer 1, a leading Canadian provider of fiber and data center assets.

American Tower: Colo as an Edge Strategy

American Tower was actively exploring opportunities in edge computing even before it acquired Colo ATL for $70 million, or about 15 times EDITDA, CEO Jim Taiclet told investors in the company’s earnings call.

“As information processing progressively moves to the network edge, we expect there to be a greater need for lower latency through distributed storage and compute functionality in close proximity to both wireless and wireline consumers,” said Taiclet. “We have been evaluating this for some time, and have an ongoing edge compute trials at several of our tower sites.”

American Tower operates more than 170,000 wireless infrastructure sites across 17 countries on five continents, including nearly 40,000 in the United States, and had more than $7.3 billion in revenue in 2018. In addition to leasing space on towers, American Tower provides access to in-building systems, outdoor distributed antenna systems (DAS), managed rooftops and services that speed network deployment.

American Tower clearly wants to monetize edge capacity at its thousands of tower sites. The Colo ATL acquisition is a beachhead in a new sector, and a bet that the earliest edge growth may involve creating denser networks in cities. Taiclet said the deal provides the company “a look at the early stages of the cloud evolution to the EDGE that we expect to see accelerate the future.”

“Colo ATL affords us the opportunity to learn firsthand about the evolution of connectivity for consumers’ devices, IoT units and autonomous vehicles to the cloud,” said Taiclet. “This includes direct and interactive knowledge of potential future tenant needs, key trends like cloud gaming technology developments, like hybrid cloud and a host of other aspects that we could not evaluate and prototype with partners without owning an asset like this.

“At the same time, I will emphasize to everyone that projects like Colo ATL do not indicate a shift in strategy or a material pivot in focus for American Tower,” he added. “On the contrary, our innovation investments are designed primarily to drive additional tenant leasing growth on our tower and in-building systems, whether it be from existing or new customers and adjacent assets that enhance the leasing value and potential of the tower.”

In other words, as digital infrastructure becomes more distributed, colocation may drive more value to towers. Options for American Tower include partnering as well as acquisitions.

“I think there is a great opportunity for us to bring our asset base, which is the 40,000 US towers and the 330 or 340 indoor DAS systems we have in the US, to a partner who brings something else, which  could be spectrum, could be cloud compute capability, could be existing big larger data centers,” said Taiclet. “Any of those are possible.”

LinkedinTwitterFacebookSubscribe
Mail

Tagged With: American Tower, Digital Bridge, Digital Colony, Towers, Zayo

Newsletters

Stay informed: Get our weekly updates!

Are you a new reader? Follow Data Center Frontier on Twitter or Facebook.

About Rich Miller

I write about the places where the Internet lives, telling the story of data centers and the people who build them. I founded Data Center Knowledge, the data center industry's leading news site. Now I'm exploring the future of cloud computing at Data Center Frontier.

  • Facebook
  • Instagram
  • LinkedIn
  • Pinterest
  • Twitter

Voices of the Industry

Mitigate Risk, Improve Performance and Decrease Operating Expenses through Data Center Self-Performance

Mitigate Risk, Improve Performance and Decrease Operating Expenses through Data Center Self-Performance If a vendor conducts the actual work in your data center, then you or your operator aren’t maximizing your current operating resources and are experiencing incremental cost and risk. Chad Giddings of BCS Data Center Operations, explains the importance of your data center provider having a high-degree of self-performance.

White Papers

cooling

Using Simulation to Validate Cooling Design

Kao Data’s UK data center is designed to sustainably support high performance computing and intensive artificial intelligence. Future Facilities explores how CFD can validated the design, implementation, and operation of their indirect evaporative cooling systems.

Get this PDF emailed to you.

We always respect your privacy and we never sell or rent our list to third parties. By downloading this White Paper you are agreeing to our terms of service. You can opt out at any time.

DCF Spotlight

Data center modules on display at the recent Edge Congress conference in Austin, Texas. (Photo: Rich Miller)

Edge Computing is Poised to Remake the Data Center Landscape

Data center leaders are investing in edge computing and edge solutions and actively looking at new ways to deploy edge capacity to support evolving business and user requirements.

An aerial view of major facilities in Data Center Alley in Ashburn, Virginia. (Image: Loudoun County)

Northern Virginia Data Center Market: The Focal Point for Cloud Growth

The Northern Virginia data center market is seeing a surge in supply and an even bigger surge in demand. Data Center Frontier explores trends, stats and future expectations for the No. 1 data center market in the country.

See More Spotlight Features

Newsletters

Get the Latest News from Data Center Frontier

Job Listings

RSS Job Openings | Pkaza Critical Facilities Recruiting

  • Electrical Commissioning Engineer - Los Angeles, CA
  • Data Center Construction Project Manager - Ashburn, VA
  • Critical Power Energy Manager - Data Center Development - Dallas, TX
  • Data Center Facilities Operations VP - Seattle, WA
  • Senior Electrical Engineer - Data Center - Dallas, TX

See More Jobs

Data Center 101

Data Center 101: Mastering the Basics of the Data Center Industry

Data Center 101: Mastering the Basics of the Data Center Industry

Data Center Frontier, in partnership with Open Spectrum, brings our readers a series that provides an introductory guidebook to the ins and outs of the data center and colocation industry. Think power systems, cooling, solutions, data center contracts and more. The Data Center 101 Special Report series is directed to those new to the industry, or those of our readers who need to brush up on the basics.

  • Data Center Power
  • Data Center Cooling
  • Strategies for Data Center Location
  • Data Center Pricing Negotiating
  • Cloud Computing

See More Data center 101 Topics

About Us

Charting the future of data centers and cloud computing. We write about what’s next for the Internet, and the innovations that will take us there. We tell the story of the digital economy through the data center facilities that power cloud computing and the people who build them. Read more ...
  • Facebook
  • LinkedIn
  • Pinterest
  • Twitter

About Our Founder

Data Center Frontier is edited by Rich Miller, the data center industry’s most experienced journalist. For more than 20 years, Rich has profiled the key role played by data centers in the Internet revolution. Meet the DCF team.

TOPICS

  • 5G Wireless
  • Cloud
  • Colo
  • Connected Cars
  • Cooling
  • Cornerstone
  • Coronavirus
  • Design
  • Edge Computing
  • Energy
  • Executive Roundtable
  • Featured
  • Finance
  • Hyperscale
  • Interconnection
  • Internet of Things
  • Machine Learning
  • Network
  • Podcast
  • Servers
  • Site Selection
  • Social Business
  • Special Reports
  • Storage
  • Sustainability
  • Videos
  • Virtual Reality
  • Voices of the Industry
  • Webinar
  • White Paper

Copyright Endeavor Business Media© 2022