London’s Global Switch to Kick Off $10 Billion Data Center Sale

(Bloomberg) -- The owners of Global Switch Holdings Ltd. are poised to kick off a long-awaited sale amid interest from other firms in the industry and investment funds, according to people familiar with the matter.

A formal sale process for the $10 billion data center company, controlled by Chinese steelmaker Jiangsu Shagang Group Co. and backed by Avic Trust Co., could start as soon as in the coming days, the people said. Global Switch and its financial advisers are ready to send out marketing materials to prospective buyers after months of preparations and informal talks, they said, asking not to be identified because the matter is private.

Buyout firms Blackstone Inc. and KKR & Co., data center investor DigitalBridge Group Inc. and operators Digital Realty Trust Inc. and Equinix Inc. have expressed preliminary interest in London-based Global Switch, Bloomberg News reported in November. A transaction could value the business at 8 billion pounds ($10 billion) or more, people familiar with matter have said. Other infrastructure-focused investors and pension funds could also be interested in Global Switch, according to the people. 

Discussions between Shagang Group and Global Switch’s management about details including the asset’s potential valuation have contributed to lengthening the sale process, two of the people said.

Deliberations are ongoing and there’s no certainty any of the suitors will decide to pursue offers, or that Global Switch’s owners will ultimately sell the business, they said. Representatives for Global Switch and Shagang Group declined to comment.

Data center companies have been attracting strong takeover interest, in part due to the perception of their having stable returns, and expectations of ongoing growth as people increasingly rely on technology.

Founded in 1998, Global Switch owns and operates 13 data centers in Europe and Asia Pacific spanning about 428,000 square meters, according to its website. It reported 251.4 million pounds in Ebitda for 2021, a 5.8% increase from the previous year, according to its annual report.