(Bloomberg) — Blackstone Inc. is close to closing a deal to acquire Australian data center operator AirTrunk for more than $20 billion ($13.5 billion), including debt, people with knowledge of the matter said in a deal that could be one of the biggest digital infrastructure deals this year.
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Blackstone has emerged as the preferred buyer for AirTrunk after outbidding rival bidders, the sources said. They declined to be named because the matter is private. The New York-based alternative asset manager and AirTrunk owners Macquarie Group Ltd. and PSP Investments are negotiating final details of a transaction that could be signed as early as this week, the sources said.
No deal has been finalized and terms could change as talks progress, the people said. Representatives for Blackstone, Macquarie and PSP declined to comment.
Blackstone is in talks with banks for a A$5.5 billion loan to be raised at the holding company level, Bloomberg News reported last week. That would be on top of a pre-agreed A$7 billion financing package provided to bidders and guaranteed by four banks, while private credit funds are in talks to provide at least A$1.5 billion in junior debt, Bloomberg reported in June.
According to insiders, Blackstone is competing with a separate consortium that also includes IFM Investors Pty, DigitalBridge Group Inc., Global Infrastructure Partners and Silver Lake Management.
The Asian cloud services market is heating up, with KKR & Co. last year agreeing to acquire a 20% stake in Singapore Telecommunications Ltd.’s regional data center business. A year earlier, Blackstone launched its first wholly owned platform dedicated to the sector in Asia.
Macquarie has a long history of investing in digital infrastructure and is one of the largest active firms in the sector. Ani Satchcroft and Ben Way helped lead Macquarie Asset Management’s investment in AirTrunk since 2019.
AirTrunk operates data centers in Australia, Singapore, Hong Kong, Japan and Malaysia, according to its website. A group led by Macquarie’s infrastructure arm took control of the company in 2020 in a deal that valued it at about A$3 billion, Bloomberg reported at the time. Before that, it was owned by investors including the special situations unit of Goldman Sachs Group Inc.
–With assistance from Vinicy Chan and Sharon Klyne.
(Updates with details on the debt package in the fourth paragraph.)
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