Investment firm GI Partners has reinvested in data center operator Flexential and secured new external investment for the company.

The company this week said its GI Data Infrastructure unit, along with an oversubscribed single-asset continuation vehicle, had both closed investments in colo provider Flexential. Terms were not shared.

"This transaction strengthens our ability to deliver long-term infrastructure projects and secures the capital needed to keep pace with surging demand for AI and enterprise computing," said Chris Downie, CEO of Flexential. "It was made possible by the confidence existing and new investors have in our strategy, and it further positions Flexential to meet the complex needs of organizations across the country."

GI formed Flexential in 2017 after merging Peak 10 and ViaWest. GI acquired Peak 10 back in 2014. Morgan Stanley is also an investor.

Today, Flexential operates 40 data centers across 18 US markets and has more than 330MW of built and under-development capacity.

The continuation vehicle, anchored by funds managed by Hamilton Lane, and the GI Data Infrastructure investment offered existing GI Partners limited partners the option to receive liquidity and provide Flexential with additional equity capital.

GI said the new capital will accelerate Flexential's development of data centers across the United States.

"Flexential plays a critical role in the digital infrastructure ecosystem, supporting latency-sensitive enterprise, AI, and cloud workloads for a diverse base of blue-chip customers," said Mark Prybutok, managing director and head of GI Data Infrastructure. "We are excited to partner with the company and look forward to contributing to its future success."

Flexential has now raised approximately $1 billion of primary equity, including last year's investment from funds managed by Morgan Stanley Infrastructure Partners (MSIP).

Founded in 2001, GI has more than $47bn in assets under management. The company, which founded and then divested Digital Realty, owns stakes in a number of data centers and also owns US operators LightEdge and DR Fortress, as well as several connectivity providers.

"This transaction validates our conviction in Flexential's leadership position in the data center market," said Travis Pearson, managing director and co-head of private equity at GI Partners. "We are excited to continue our partnership with the Flexential team and look forward to supporting the company's next phase of growth."

Baird and Goldman Sachs & Co. LLC served as financial advisors, and Ropes & Gray LLP and Simpson Thacher & Bartlett LLP served as legal advisors to GI Partners. Debevoise & Plimpton LLP served as legal advisor to Hamilton Lane.