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Digital Realty agreed to acquire Brazilian data-center operator Ascenty from Great Hill Partners for approximately $1.8 billion in September 2018, and the deal closed on December 20, 2018. Digital Realty’s Brazilian subsidiary, Stellar Participações Ltda., was the buyer. Brookfield Infrastructure later invested in a joint venture that owned Ascenty, leaving Digital Realty and Brookfield with shared control.

Who bought Ascenty, and when did the deal close?

Digital Realty announced the acquisition on September 24, 2018. Its Brazilian subsidiary, Stellar Participações Ltda., agreed to purchase Ascenty from private equity firm Great Hill Partners. Digital Realty reported that the acquisition closed on December 20, 2018. The transaction is completed, not a pending purchase. Digital Realty’s announcement and its later 2019 SEC filing document the chronology.

What did the acquisition cost?

Digital Realty described the transaction in its September 2018 announcement as worth approximately $1.8 billion. A September 21, 2018 SEC filing estimated consideration at $1,826.8 million before purchase-price adjustments, transaction expenses, taxes, and potential currency fluctuations. That estimate comprised $1,511.1 million in cash, $290.7 million in Digital Realty Operating Partnership common units, and $25.0 million in equity interests in an indirect subsidiary. These components describe the filing’s estimated consideration, not an amount guaranteed to remain unchanged after the listed adjustments and exclusions. The September 2018 SEC filing gives the detailed estimate.

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How did Brookfield Infrastructure participate?

Planned investment at announcement

When the deal was announced, Brookfield Infrastructure committed to fund part of the equity investment in exchange for a 49% interest in a joint venture expected to own Ascenty. Digital Realty estimated Brookfield’s initial investment at approximately $613 million, excluding Brookfield’s share of transaction costs. This was the announcement-stage estimate, not the later reported amount invested.

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Investment and ownership reported in 2019

In its 2019 reporting, Digital Realty said Brookfield had invested approximately $702 million for approximately 49% of the joint venture formed in March 2019. Digital Realty’s subsidiary retained the remaining interest, but the partners shared control equally. Digital Realty therefore deconsolidated Ascenty effective March 29, 2019, because it no longer controlled the venture. The approximately $613 million announcement estimate and approximately $702 million later-reported investment refer to different stages of the transaction; they should not be treated as competing figures for the same event. Digital Realty’s 2019 SEC filing describes the completed joint venture and accounting change.

Why did Digital Realty want Ascenty?

Digital Realty said the acquisition would expand its global footprint and product mix while strengthening and diversifying its data-center portfolio. Its stated strategic aim was to establish the company as a leading data-center provider in Latin America. CEO A. William Stein said the purchase would help “strengthen and diversify Digital Realty’s data center portfolio and expand our product mix and global footprint.” The announcement set out that rationale.

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What did Ascenty’s footprint look like in 2018?

Digital Realty’s transaction overview described Ascenty at the time of the announcement as having 14 data centers and 106 MW of total planned capacity. Of that capacity, 73 MW was reported as 90% leased or pre-leased: 39 MW was in service and 34 MW was under construction. Another 33 MW was available for future development. These were historical announcement-era figures and plans, not a description of Ascenty’s present-day operations or confirmation that the planned capacity was later completed.

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The same overview anticipated approximately $425 million in capital expenditures to finish development already underway and build additional capacity for near-term demand. That was a planned investment associated with the acquisition-era pipeline, not a report of spending already completed. Digital Realty’s 2018 transaction overview provides the footprint and development figures.

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What happened after the acquisition?

  1. September 24, 2018: Digital Realty announced its agreement to acquire Ascenty from Great Hill Partners.
  2. December 20, 2018: The acquisition closed.
  3. March 2019: Digital Realty and Brookfield formed the joint venture holding Ascenty.
  4. March 29, 2019: Digital Realty deconsolidated Ascenty after control became shared equally rather than remaining with Digital Realty.

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