Suitors interested in buying the Australian data centres owned by Global Switch have failed to hit the bid price, sources say, because of expectations they come with a sizeable capital spending bill.
It is understood there were suitors interested in paying about $2bn for the two data centres on offer. But the company’s global owner was holding out for about $2.5bn.
Some have taken the view that the assets were worth not much more than $1.5bn because of the amount of capital spending needed.
Stonepeak had been thought to be well placed to buy the assets and the contest frontrunner.
On offer by its Chinese owner are two major data centres on the western edge of Sydney’s CBD comprising 73,000sq m of space.
Global Switch is advised by UBS.
Partners Group was earlier believed to be looking at the offering.
It comes as suitors remaining in the competition for data centre group AirTrunk are preparing to lob their final bids for the business in the week beginning on August 26.
Left in the contest is the Morgan Stanley and Deutsche Bank-advised Blackstone, Barrenjoey-advised Digital Bridge, which is working with IFM, and GIP, advised by Goldman Sachs.
Canada Pension Plan Investment Board is expected to join with GIP or Digital Bridge for the pursuit.
Macquarie Group is now seen as more likely to sell all of the business after suggestions that only part could be on offer.
The Australian listed financial group will probably want an outcome by the time it delivers its full-year result in October, with Macquarie Asset Management so far having fewer big transactions this financial year than it has in the past.
The asking price for AirTrunk is thought to be more than $5bn.
Overseeing the process are Goldman Sachs and Macquarie Capital.
The owners of AirTrunk are Macquarie Group, PSP and the founder, ex-Next DC executive Robin Khuda.
AirTrunk has more than 1.4 gigawatts of announced data centre capacity across 11 sites and a pipeline for further capacity.
It is considered the best-in-class hyperscale data centre platform for large cloud content and enterprise customers across the Asia-Pacific.
Launching its first hyperscale data centre in western Sydney, it operates throughout the Asia-Pacific region, in Japan, Malaysia, Hong Kong, Australia and Singapore.
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