Bids to acquire the Australian operations of data center operator Global Switch have reportedly failed to meet expectations.
The Australian reports that suitors interested in buying the Aussie data centers owned by Global Switch have failed to hit the bid price.
The publication suggests the bids fell short because of expectations they come with a sizeable capital spending bill.
Global Switch currently operates two adjacent conjoined data center buildings in the Ultimo area of Sydney on an 11,090 sqm (119,370 sq ft) site. The 392-422 Harris Street property is known as Sydney West, while 273 Pyrmont Street is known as Sydney East.
The seven-story West was constructed in the early 2000s and currently offers 20.5MW. The six-story East was built in the mid to late 2010s and currently offers 22MW. The company recently filed to expand the site with additional floors on the existing buildings.
AFR reports Stonepeak, Queensland Investment Corporation, and the Canada Pension Plan Investment Board were bidding on the AU$2 billion (US1.33bn) business.
Australian operator NextDC was previously believed to be interested in Global Switch’s Antipodean operations.
Founded in 1998, London-based Global Switch operates 13 facilities across Europe, Australia, and Asia, totaling around 4.6 million sq ft of technical space. The company has another building in development in London, UK, and completed construction on a facility in Frankfurt, Germany.
The failed bids are the latest in protracted efforts to find a buyer for Global Switch.
Chinese steel giant Jiangsu Shagang Group took control of the data center company over a three-year period beginning in 2016. The company has been flirting with a sale for nearly fours years, first talking to potential acquirers back in January 2021 for a possible $10-11 billion sale.
More than a dozen firms have been linked as potential buyers. Investment firms EQT, KKR, and PAG were reportedly shortlisted for a final round of bidding last year, but talks were said to have ‘ground to a halt’ in January 2023 over a gap in company valuations. EQT was reportedly still interested in a deal valuing the company at closer to around $6-7 billion.
Several Australian governmental departments have left Global Switch’s Sydney site after Chinese investors took control of the company, including the Department of Home Affairs, the Australian Securities and Investments Commission, the Australian Digital Health Agency, and the Australian Communications Media Authority.
Global Switch CEO John Corcoran retired from the company at the turn of the year.
Australian data center firm AirTrunk is reportedly close to being acquired, while local operator iseek is also said to be looking for a buyer. Fujitsu is reportedly also seeking to offload its Australian data centers, while Edge firm DXN recently exited its Sydney site and is exploring options for its remaining facilities.
