Blackstone will take QTS Realty private in $10-billion all-cash deal

Investment firm Blackstone Group said on Monday it would take data center operator QTS Realty Trust private in an all-cash deal worth about $10 billion.

 

Blackstone Funds, the buyout firm's infrastructure unit along with its non-traded real-estate income trust and other long-term perpetual capital vehicles, will pay $78 per share, which represents a premium of about 21 per cent to QTS’ closing price on Friday.

 

Shares of QTS rose about 21 per cent to hit a record high of $78.24.

 

The equity value of the deal stands at $5.37 billion, according to Reuters calculations, based on 68.9 million outstanding shares, as of April 29.

 

A Covid-19 pandemic-led remote working environment boosted demand for cloud services, which are reliant on data centers.

 

QTS has more than 7 million square feet of data center space throughout North America and Europe.

 

The $10-billion transaction, which is expected to close in the second half of this year, includes the assumption of the data center operator's existing debt. The deal also includes a 40-day go-shop period, which will let QTS solicit and consider other proposals, the companies said.