Morgan Stanley buys majority stake in French data center company

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Morgan Stanley buys majority stake in French data center company

Altice France has signed an agreement to partner with Morgan Stanley Infrastructure Partners (MSIP) to establish the first nationwide independent distributed colocation provider in France through the sale of a 70%-majority stake in UltraEdge, a data center company to be formed and comprising 257 data centers plus office space currently operated by SFR across France.

The envisaged transaction values UltraEdge at an enterprise value of €764 million representing an attractive multiple of c.29x 2023 pro forma EBITDA of €26 million.

In addition, SFR will enter into a build-to-suit agreement with UltraEdge by which SFR is expected to generate approximately €175 million of additional proceeds to SFR within the next 7 years.

UltraEdge will be the first nationwide independent distributed datacenter operator in France with more than 45MW of installed capacity and c.33,000sqm of owned office space distributed across the country including in key metropolitan areas. UltraEdge enables essential data storage and connectivity services from these sites which are all connected on SFR’s nationwide fiber infrastructure.

The passive infrastructure and equipment of the data centers will be transferred to UltraEdge with servers and active equipment retained at SFR.

The transaction will be subject to customary conditions precedent for this type of transactions in France. Closing of the transaction, which will be subject to regulatory approvals, is expected to occur in the first half of 2024.

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