Data center mergers and acquisitions (M&A) enjoyed a record year in 2024, new analysis has revealed.
A previous report from Synergy Research Group said deals closed in 2024 reached $57 billion. However, an update to the report has revealed this figure now stands at north of $73 billion.
The report said a deal expected to close in 2025 quietly crossed the finish line at the end of December.
Last year was already in record-breaking territory before the Blackstone-led acquisition of AirTrunk closed at the end of December. At almost $16 billion, the acquisition has set a new benchmark for the biggest deal ever closed.
Other deals in 2024 included two separate equity investments in Vantage Data Centers, totaling a value of $9.2 billion. Vantage also received a $3.1 billion equity investment in its EMEA operations.
EdgeConneX and DataBank both also saw large equity investments.
The previous peak was in 2022, when deals worth $52 billion were closed. In contrast, 2023 saw a relative lull, with M&A activity dropping to $26 billion.
Synergy's report attributes 2022’s peak to two “mega deals” in 2022, valued at $11 billion or more each. These deals were the acquisitions of CyrusOne and Switch, acquired in March and December of 2022 respectively.
If deals of $2 billion or more were to be excluded, the pattern would show 2021 as the peak, with 2022 dropping off by 32 percent, 2023 dropping by seven percent, and 2024 jumping by 133 percent.
Looking to 2025, more than $7 billion in deals have already closed with another $15 billion agreed but not formally closed.
Earlier this month, OpenAI announced ‘The Stargate Project’, a new company set to invest $500 billion into AI infrastructure over the next four years. Of the total investment, $100 billion will be deployed immediately. SoftBank, OpenAI, Oracle, and Abu Dhabi’s MGX are the equity investors in the project.
The report added that aside from the rapid rise in overall M&A activity, the most notable feature is the flooding of private equity in the sector. Since 2021, private equity has accounted for between 80 to 90 percent of the value of closed deals.
M&A deals include company acquisitions, investments in joint ventures, minority equity investments, individual data center acquisitions, share sales, and acquisition of land for data center development.
