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Great Hill reaps 8.5x with $1.8 bln Ascenty sale

  • Great Hill initially invested in Ascenty in 2011
  • Great Hill Fund IV closed on $1.1 bln in 2009
  • Brookfield Infrastructure to invest $613 mln for 49 pct of Ascenty

Great Hill Partners made more than 8.5x its money with the sale of Ascenty Holdings LLC after a seven-year hold, a source said.

The Boston private equity firm closed its sale of a controlling stake in Ascenty on Dec. 20. In September, Digital Realty said it would buy the company for more than $1.8 billion.

The deal called for Brookfield Infrastructure, part of Brookfield Asset Management, to commit half the required equity, or $613 million, for 49 percent of Ascenty, Buyouts has reported.

Great Hill’s investment in the Brazilian data-center operator dates to 2011 when it initially provided capital to Ascenty, PitchBook said. The PE firm provided $70 million equity to Ascenty from 2011 to 2015, the source said. With the sale, Great Hill made more than 8.5x its investment, the person said.

Ascenty, Campinas, Brazil, was founded in 2010. It owns 14 data centers that are interconnected using a nearly 4,500-kilometer (2,800-mile) fiber network. The company has about 140 customers.

To launch Ascenty, Great Hill drew on its 25-year relationship with Chris Torto, the company’s founder and CEO, a source said.

Torto was also founder and CEO of Vivax, a Brazilian cable TV and broadband company that Great Hill invested in in 1999. (Vivax went public in Brazil in 2006 and was sold later that year to Telmex for $675 million.)

Blackstone Group invested in Ascenty in June 2017. It owned a “debt-like security” in Ascenty that helped the company build out its data centers, the source said.

Ascenty said in January that it had increased its debt line to $350 million, according to press reports. Blackstone exited in August, the source said.

The company went up for sale this year, drawing “substantial interest” from strategics and financial buyers, the person said.

Peter Hopper and Adam Lewis of DH Capital provided financial advice to Great Hill and Ascenty.

Great Hill’s fourth flagship fund, which closed on $1.1 billion in 2009, invested in Ascenty. The firm’s fifth flagship raised $1.1 billion in 2015 while its sixth pool collected $1.5 billion in 2017.

Great Hill targets middle-market companies in sectors including software, financial and healthcare technology. The firm typically invests $25 million to $200 million equity per deal.

Action Item: For more info on Great Hill: www.greathillpartners.com/