Zayo Group named Steve Smith as Chief Executive Officer, replacing Dan Caruso..
Smith was recently a Managing Director of the Private Equity firm GI Partners. Before that, he was CEO of Equinix for over 10 years, growing revenues from $400 million to $4.4 billion across 200 data centers, in 52 markets. He is a West Point graduate and an 8-year Army veteran.
“Steve’s track record successfully managing growing digital infrastructure businesses while maintaining high levels of operational reliability and excellence is the perfect fit for Zayo as it enters the next phase of its growth,” said Marc Ganzi, President and Chief Executive Officer of Colony Capital, and CEO of Digital Colony. “Steve will have big shoes to fill. Dan built an amazing company in just over a decade and we look forward to benefiting from his contributions as a key member of our Board of Directors.”
“Dan has built and developed Zayo from a startup into one of the defining companies of the digital transformation,” added Jan Vesely, Partner at EQT Partners, “and we are proud to continue working with Dan and Zayo on our ambitious growth plans for the company.”
DataBank to acquire Zayo’s zColo data centers
DataBank agreed to acquire Zayo Group’s zColo business, including 44 data centers across 23 markets in the U.S. and Europe. Financial terms were not disclosed.
The deal will make DataBank one of the largest privately-held data center operators in the U.S. and a leading provider of edge colocation and connectivity solutions to hyperscale, technology, and content customers across the U.S. Zayo Group will become a significant customer and continue to be an anchor tenant within the zColo facilities. Following completion of the deal, DataBank’s assets will include:
- 64 data centers in 29 markets (up from 20 data centers and 9 markets)
- Over 3,000 customers including many Fortune 100 and leading cloud and content providers
- Pro forma annual revenue of over $450M
- 1.1M raised square feet of data center space
- 141 MW of installed UPS capacity
- Over 30,000 network cross connects
- 18 major network interconnection points
- 12 cloud nodes
The transaction is being funded by an investor group led by Colony Capital (NYSE: CLNY), DataBank’s controlling shareholder, which includes Nuveen Real Estate and others. In addition to leading a consortium of world-class institutional investors to support the acquisition, Colony Capital is investing $145 million from its balance sheet to maintain its 20% stake in DataBank. Debt financing associated with the transaction has been underwritten by TD Securities, Truist Securities and Société Générale, acting as Joint Lead Arrangers and Joint Bookrunners for the new Credit Facility.
Zayo shareholders approve acquisition by Digital Colony Partners
Shareholders of Zayo Group Holdings approved all proposals related to the definitive merger agreement to be acquired by affiliates of Digital Colony Partners and the EQT Infrastructure IV fund.
“Today’s favorable shareholder vote supports our view that this transaction is a very good outcome for shareholders and will enable Zayo to accelerate its growth and strengthen its industry leadership,” said Dan Caruso, chairman and CEO at Zayo. “The entire Zayo team is excited to work with EQT and Digital Colony to leverage our fiber assets to continue to fuel global innovation.”
The closing of the deal is expected to close in the first half of calendar 2020.
Private investors to acquire Zayo for $14.3 billion in cash
Affiliates of Digital Colony Partners and the EQT Infrastructure IV fund will acquire Zayo Group Holdings for $35.00 in cash per share of Zayo’s common stock in a transaction valued at $14.3 billion, including the assumption of $5.9 billion of Zayo’s net debt obligations. The offer price represents a 32% premium to the volume-weighted price average of the last six months of $26.44.
