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Brookfield Infrastructure<\/a> Partners LP and DigitalBridge Group Inc<\/a> are battling it out in the race to acquire Compass Datacenters<\/a> LLC for more than $5.5 billion, including debt, according to people familiar with the matter.
Brookfield<\/a> and DigitalBridge<\/a> are leading opposing bidding consortia in the auction for privately held Compass, the sources said, adding an outcome is expected by next month.
The terms of Compass' debt allow for it to be taken over by a new owner without it being refinanced, one of the sources said. This is making the deal easier to complete at a time when high interest rates and market volatility have made debt for leveraged buyouts scarcer and more expensive.
The sources requested anonymity because the matter is confidential. The Deal reported in February that Compass Datacenters was exploring a sale.
Compass Datacenters, Brookfield Infrastructure Partners and DigitalBridge declined to comment.
Dealmaking in the data center sector has spiked in recent years as the rapid growth of the sector, fueled by cloud computing<\/a>, has attracted large infrastructure investors, and the fragmented nature of the industry has driven consolidation.
Dallas, Texas-based Compass Datacenters provides customized data centers for companies. It is owned by RedBird Capital Partners<\/a>, Ontario Teachers' Pension Plan, and the Azrieli Group<\/a>.
Brookfield Infrastructure manages $161 billion of assets across sectors including transportation, data centers, utilities, and midstream. Its current portfolio includes 50 data centers, according to its website.
In April, Brookfield snapped up a majority stake in Data4 in a deal that valued the data center operator at close to 3.5 billion euros ($3.8 billion) including debt, Reuters reported.
During the same month, Brookfield Infrastructure also acquired freight container lessor Triton International Ltd for about $4.7 billion.
Boca Raton, Florida-based DigitalBridge is a digital infrastructure investment firm, which manages nearly $69 billion in assets.
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