Swedish private equity giant EQT Group announced on Wednesday that its EQT Infrastructure IV fund has agreed to acquire data center provider EdgeConneX, a major player in the fast-growing hyperscale and edge computing markets. The seller is an investor group led by the private equity firm Providence Equity Partners.

EdgeConnex currently operates more than 40 data centers in 33 markets in North America, Europe and South America. Price terms of the acquisition were not disclosed.

TMT sector growth

The acquisition adds to a growing roster of technology, media and telecom (TMT) sector portfolio companies in the EQT Infrastructure IV fund acquired over the past 12 months, including German fiber-optic internet leader Deutsche Glasfaser/inexio, Malta’s diversified telecom Melita, and U.S-based fiber and telecom infrastructure provider Zayo Group.

Over 40% of the fund’s commitments are from pension funds, with 25% coming from insurance and other financial firms, and 16% from sovereign wealth funds.

In a release announcing the deal on Wednesday, EQT Infrastructure stated that it will support the continued development of EdgeConneX and actively assist in its pursuit of new growth opportunities in new and existing markets globally.

Calling EdgeConneX “uniquely positioned to benefit from the secular tailwinds driving increased data center usage,” EQT stated: “As the need for data grows ever larger, not only because of cloud and content, but also driven by new innovations such as Artificial Intelligence, 5G Networks, Autonomous Vehicles, Virtual Reality, Cloud Gaming, and the Internet-of-Things, there will continue to be substantial opportunities for EdgeConnex to continue to develop critical infrastructure to support its customers’ needs.”

In a statement, EQT Partner Jan Vesely, said, “EQT has followed EdgeConneX’s journey from its early years to its growth into a top data center industry player. We are deeply impressed by EdgeConneX’s management team and the success they have had in creating a key contributor to the global cloud infrastructure. This partnership represents an exciting opportunity for EQT in a sector and geographies where we have significant experience. EQT looks forward to working with the team in continuing to grow the business and identify new expansion opportunities.”

The transaction is expected to close in Q4 of 2020, subject to customary closing conditions, at which point EQT Infrastructure IV is expected to be 80-85% invested.

EQT currently has more than EUR 62 billion in raised capital and EUR 40 billion in AUM spread across 19 active funds, with portfolio companies in Europe, Asia-Pacific and North America.

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