Ex-Digital Realty Deal Architect forms a data center joint venture with...

In May 2018, when Scott Peterson left the Digital Realty Trust, which he co-founded in 2004, Digital was the second largest data center provider in the world by revenue. He was the main architect behind the giant’s industry-changing businesses, including the $ 7.5 billion acquisition of DuPont Fabros and the $ 1.9 billion acquisition of Telx.

This week he announced his latest deal. Together with his digital colleagues Christopher Kenney and Stephen Taylor, he founded Global Compute Infrastructure, a joint venture with Goldman Sachs to build a new global data center platform.

With Goldman’s support, Global Compute plans to purchase and build digital infrastructure assets, including data centers and network infrastructure, and provide infrastructure services to cloud providers and other large customers.

“We don’t want to build a small digital lot,” Peterson, CEO of the new company, told DCK. “By and large, we want to invest in data infrastructure, but the reality is that most of it will be in data centers.”

Goldman’s Merchant Banking Division has raised up to $ 500 million from its West Street Infrastructure Partners III infrastructure fund to the company. But the $ 500 million is just a “lever number,” said Peterson. “We will grow far beyond that.”

According to Goldman’s announcement of the deal, the initial commitment will enable Global Compute to make short-term investments of approximately $ 1.5 billion.

Peterson and his two ex-digital partners have all invested in the joint venture and shared control of the company with Goldman, he said. He refused to disclose individual ownership interests.

The company has already made its first acquisition, which could be viewed as a model for other businesses it is seeking. The company has acquired ATM, the well-established data center and communication services company in Poland, one of the hottest emerging markets for digital infrastructure.

While no good opportunities are missed in North America, Global Compute will immediately focus on primary and secondary markets in Europe, Asia-Pacific, and Latin America.

ATM, which owns data center and fiber optic facilities with a focus on Warsaw, was attractive because of its status as a dominant player, its competent management team and the team’s desire to expand.

“What they really need is growth capital and a little more experience from people who have worked on a global scale,” said Peterson.

While there is no shortage of major investors these days who want to invest money in digital infrastructure, experienced teams that have shown that they can be successful worldwide are rare. Peterson doesn’t hesitate to point out that he and his partners are one of these teams.

“We are a [much] A better partner than someone who just shows up with money, ”he said, referring to the frenzy of M&A deals that the sector has seen over the past few years, which are largely by new entrants such as traditional infrastructure investors, pension funds and state funds was fueled. “There’s no other team on the planet that has that [our] Experience level. ”

Kenney, COO of Global Compute, was a founding partner of GI Partners, the private equity fund whose assets went public in 2004 under the name Digital Realty Trust. Most recently he was Senior VP at Digital.

Taylor, now the European head of Global Compute, left Digital about a year ago after serving as VP of Acquisitions and Investments for more than seven years. Before that, he was with CBRE for 10 years.

Goldman was an attractive partner because of its global size. Peterson “started talking to Goldman about a year ago and then got very serious with them earlier this year,” he recalled. He had spent some time looking for a partner with a global platform and network and deep financial resources.

“These people are global so they can help us with relationships,” said Peterson.

Global Compute’s product strategy focuses on data center space and connectivity for large customers. While he hasn’t ruled out some higher-level products like cloud or managed services being added, there are plenty of business opportunities just for core infrastructure assets in the foreseeable future.

“We have a very active pipeline. We have a lot of ideas, ”said Peterson. “We assume that we will be working on other transactions immediately. There are many market opportunities. ”