DXN has amended its acquisition deal with PAG’s Flow which will now see the latter only acquire the former’s modular manufacturing unit. DXN will retain its data center business.
In August, DXN said its directors had unanimously voted that all its business assets and subsidiaries were to be sold to Flow2Edge Australia, a subsidy of Asia-focused investment manager PAG Real Estate, for approximately AU$26 million ($18m) in cash. The deal would include both its data centers and its modular manufacturing businesses, with a further update suggesting DXN would be wound up after the sale.
However, due to an “inability to satisfy the conditions precedent to the Sale Agreement,” DXN said this week it would now only sell the business and assets relating to the company's Edge module manufacturing business and retain the data center businesses.
ASX-listed DXN currently operates three data centers; the 4,351 sqm (46,800 sq ft), 5.5MW DXN-SYD01 in Sydney, a second facility in Hobart, Tasmania, and a 350 sqm (3,700 sq ft) bunker with two data halls in Darwin.
Flow will pay DXN AU$20 million (US$13.75m) to acquire the modular business. The companies are yet to sign the revised agreement, but it is expected to close before the end of the year.
DXN said it intends to use the proceeds from the Revised Transaction to repay its debts, provide working capital for its data center business, and make a distribution to its shareholders.
Asia-focused investment manager PAG Real Estate launched Flow, a new investment platform focused on digital infrastructure in APAC, in late 2021. The unit is led by former ChinData and Bridge Data Centres executive Kris Kumar. Based in Singapore, the team is focused on Japan, Australia, and other Asian markets. Flow recently announced a partnership with Ayala Land to develop data centers in the Philippines.
PAG is reportedly one of several companies potentially interested in acquiring Global Switch.