Data Center Finance: QTS Realty Trust Acquires Carpathia Hosting
QTS Realty Trust announced in early May that it signed a deal to acquire colocation data center and managed services provider Carpathia Hosting.
Carpathia offers high-level security and compliance solutions to enterprise customers and federal agencies and is a leading provider of hybrid cloud and infrastructure-as-a-service solutions. The transaction, which will cost approximately $326 million, will help to strengthen QTS Realty’s existing real estate and technology services platform. Together, the combined companies will provide services to more than 1,000 customers in North America, Europe and Asia.
“Carpathia will be a great complement to our existing platform, enhancing and expanding our premium product and service offering, while delivering added value to customers, shareholders and employees,” said Chad Williams, Chief Executive Officer for QTS Realty. “The addition of Carpathia, with its seasoned management team, will accelerate QTS’ already industry-leading performance, and further strengthen QTS’ unique integrated technology services platform that enterprise customers increasingly require.”
QTS Realty will receive a variety of strategic benefits from the deal, including accelerated federal business through Carpathia’s existing relationships and the ability to leverage that business with QTS’ Richmond, Virginia data center. The acquisition will also help QTS to diversify and expand their data center portfolio and add strategic international facilities. Carpathia’s existing 230 clients will be added to QTS’ customer base, creating a combined total of more than 1,000 customers. The deal will allow the company to cross-sell their own infrastructure and Carpathia’s product mix which includes solutions like VMware’s vCloud Government Service.
The deal calls for QTS to buy Carpathia for $290 as well as taking approximately $36 million of capital lease obligations, creating a total enterprise value of roughly $326 million.
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