Iron Mountain, a storage and information management services company, and AGC Equity Partners have formed a joint venture of 300 million plus euros to design and develop a data center currently under development in Frankfurt, Germany. According to terms of the agreement, AGC will own an 80 percent stake in the JV while Iron Mountain will own a 20 percent stake.
PRESS RELEASE
BOSTON–(BUSINESS WIRE)–Iron Mountain Incorporated (NYSE: IRM), the storage and information management services company, today announced the formation of a 300 million+ Euro joint venture (the “Venture”) with an affiliate of AGC Equity Partners (“AGC”), a London-based global alternative asset manager to design and develop a 280,000 square foot, or 27 megawatt, hyperscale data center currently under development in Frankfurt, Germany (the “Frankfurt Data Center”).
As previously disclosed, the Frankfurt Data Center is 100% pre-leased to a U.S.-based Fortune 100 customer subject to a 10-year lease agreement (the “Lease”). Full build-out of the 27 megawatt data center is expected in the second quarter of 2022. Iron Mountain will be responsible for managing the design and development of the data center as well as administering the Lease.
“We are pleased to partner on the Frankfurt Data Center with AGC, a premier real estate and private equity investor with a strong global data center platform, to support this exciting data center growth opportunity and to continue to build-out our global platform,” said Mark Kidd, Executive Vice President and General Manager of Data Centers at Iron Mountain. “This partnership represents an important strategic step towards our goal of identifying alternative sources of capital to fund accelerating growth, as proceeds from the Venture will be redeployed into higher return development opportunities.”
AGC has built a high-quality global data center franchise over the past several years, and recognizes the benefits of working alongside a partner with a proven track record in the development of data centers to continue capitalizing on the unprecedented demand for data centers worldwide.
Financial Impact
Under the terms of the agreement, AGC will own an 80% equity interest and Iron Mountain will own a 20% equity interest in the Venture. AGC contributed cash to purchase its 80% equity interest in the Venture, while Iron Mountain retained a 20% equity interest in the Venture.
Debt financing for the Venture is expected to close in the fourth quarter of 2020, with proceeds expected to fund a portion of the planned development and construction costs.
Under the terms of the Venture agreement, Iron Mountain will earn various fees, including property management and construction and development fees for services provided to the Venture, all of which will be recorded as revenue in Iron Mountain’s reported financial statements as earned.
The Venture will be reflected as an unconsolidated equity method joint venture on Iron Mountain’s reported financial statements.
Goldman Sachs & Co. LLC served as lead financial advisor to Iron Mountain. King & Spalding LLP served as Iron Mountain’s legal advisor.
About Iron Mountain
Iron Mountain Incorporated (NYSE: IRM), founded in 1951, is the global leader for storage and information management services. Trusted by more than 225,000 organizations around the world, and with a real estate network of more than 90 million square feet across more than 1,480 facilities in approximately 50 countries, Iron Mountain stores and protects billions of valued assets, including critical business information, highly sensitive data, and cultural and historical artifacts. Providing solutions that include secure records storage, information management, digital transformation, secure destruction, as well as data centers, cloud services and art storage and logistics, Iron Mountain helps customers lower cost and risk, comply with regulations, recover from disaster, and enable a more digital way of working. Visit www.ironmountain.com for more information.
About AGC Equity Partners
AGC is a global alternative asset management firm which invests across the capital structure in real assets and other private equity strategies, with a particular focus on European and North American assets. AGC has around USD 6 billion in assets under management. AGC maintains strong relationships with some of the world’s leading sovereign, institutional and ultra high net-worth investors who invest with AGC across multiple asset classes and strategies.
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