Data center investor DigitalBridge could be acquired if efforts to raise funds prove unsuccessful, one of the company’s investors has said.
Asset manager Ave Maria said in a note to investors that while its portfolio has performed well in 2024, “the stock price performance of some of the holdings has not reflected their strong operating performance.”
Highlighting DigitalBridge, which represents 11.6 percent of the Ave Maria Focused Fund, the financial firm said: “DigitalBridge is currently raising their third flagship digital infrastructure fund. If the raise is successful, DigitalBridge’s stock price should prove to be quite cheap at current levels. If the raise is unsuccessful, DigitalBridge will likely be bought by a larger competitor.”
At the time of writing, DigitalBridge’s share price sits at $13.30. This compares to $16.50 a year ago. As recently as December 2021, the company’s stock was worth $31.64.
US-based DigitalBridge manages, owns, and invests in digital infrastructure across the world. Its footprint includes more than 60 data centers, 20 interconnection hubs spanning 30 markets, and a modular Edge data center platform.
Its investments include Vantage, DataBank, Scala, AtlasEdge, AIMS, Digita, Landmark Dividend, Switch, and multiple fiber and tower firms.
Ave Maria’s note said there are “reasons to be optimistic” that DigitalBridge will be able to raise additional funds without the need for a takeover. Reports emerged earlier this year suggesting one of its portfolio companies, Switch, could IPO at a value of $40 billion.
That valuation “could be too optimistic,” the Ave Maria note said, but it added: “In our view, there is little doubt that Switch will be a successful investment for DigitalBridge, and its IPO could provide a boost to DigitalBridge’s fundraising efforts.”
DigitalBridge has been actively making deals in recent months, announcing plans to acquire data center developer Yondr for an undisclosed sum. This deal will close early next year.
It has also completed the purchase of Japanese infrastructure provider JTower at a price of $466 million.
Meanwhile, the company is reportedly looking to sell its Brazilian data center company Scala in a move than could raise $2 billion.
DCD has contacted DigitalBridge for comment on Ave Maria's note.
