ITWire

Digital Reality CEO, Michael F. Foust, said the company had entered into a definitive share sale and purchase agreement to acquire the data centres, located in the suburbs of Woking, Watford and Croydon, for approximately £715.9 million - equivalent to $US1.1 billion - subject to adjustment in limited circumstances and to additional earn-out payments based on a multiple of the net operating income from the lease-up of currently vacant space in the portfolio in the next three years.

Foust said the company expected to fund the purchase price and related earn-out payments with available cash, borrowings under the company’s global revolving credit facility, a bridge loan facility and/or the sale of debt or equity securities.

The acquisition is expected to close on or about 31 July this year.

“We believe the addition of these high quality, mission critical facilities to our operating portfolio will enable us to serve a wide variety of customers seeking institutional quality data centre space in London, a highly strategic global data centre market,” Foust said.

Digital Reality’s Chief Acquisitions Officer, Scott Peterson, said the portfolio was approximately 80 per cent leased to a “diverse roster of 21 tenants, including leading multinational financial institutions and global network providers, with a weighted average remaining lease term of approximately eight years.

 “In addition to the stable in-place income, there is a significant value-add opportunity to lease the balance of the portfolio’s available space.”