Private equity firm Avista Capital Partners has acquired Dallas data center operator DataBank Holdings from Freeman Group, a private investment firm, the companies said today. DataBank provides managed services to more than 80 customers from data center facilities located in the former Federal Reserve Bank building in Dallas’ downtown central business district. Financial terms of the transaction were not disclosed.
Avista Capital manages approximately $4 billion of capital, with offices in New York, Houston, and London. The company has invested primarily in the energy and media industries. Avista said it intends to invest in expanding DataBank’s data center footprint, and may acquire other properties or companies.
Trend With “Strong Secular Tailwinds”
“The trend of businesses outsourcing IT services, combined with rapidly growing Internet traffic, creates strong secular tailwinds,” said Brendan Scollans a Partner at Avista. “DataBank is an ideal platform from which to capitalize on these trends, having proven its ability to deliver rapid growth while serving the most demanding blue chip customers. We have dedicated additional capital to expand DataBank’s footprint and services both organically and through acquisitions.”
As part of the transaction, Timothy Moore will join DataBank’s management team as Chief Executive Officer. Moore, a 10-year veteran of the data center industry, previously held senior sales and management positions at ViaWest and Dataside.
“I am thrilled to be joining DataBank,” said Moore. “Together with the existing DataBank management team, I look forward to continuing to deliver to our customers outstanding service, mission-critical levels of availability and cost effective solutions. Furthermore, I am excited to partner with Avista, a financial sponsor who supports our desire to accelerate DataBank’s expansion.”
“We are very pleased to be partnering with Avista, an established communications investor with expertise in scaling successful businesses,” said Patrick Guadalajara, who will continue with the company as the President of DataBank. “DataBank has enjoyed very high growth over the past several years, and this transaction positions us to expand our leadership in the growing data center industry.”
Houlihan Lokey acted as financial advisor to DataBank and Jackson Walker LLP acted as legal advisor to Freeman Group. Ohashi & Horn LLP acted as legal advisor to DataBank’s senior management. Kirkland & Ellis LLP acted as legal advisor to Avista.