Stonecourt Capital Acquires 365 Data Centers, Eyes More Deals

Private equity investor Stonecourt Capital has acquired a majority stake in 365 Data Centers. Original investors Lumerity Capital and Longboard Advisors have reinvested into the US data center provider, while Chirisa Investments and Turning Rock Partners have exited.

New York-based Stonecourt appears ready to invest more to grow the provider’s capabilities. “We are already engaged in several near-term acquisition opportunities, which will meaningfully enhance [365’s] service offerings,” Lance Hirt, a Stonecourt managing partner, said in a statement.

Terms of the deal were not disclosed.

Acquisitions have been coming at a rapid clip in the data center provider industry. Both providers and investors have been on the hunt for opportunities to capitalize on growing demand for data center space.

Demand for deals has accelerated due to the COVID-19 pandemic, which has made digital services – all served out of data centers – more important than ever.

Just last week DataBank announced a deal to acquire zColo, the colocation business of Zayo Communications. If closed, the deal will make DataBank one of a handful of the largest privately held data center providers in the US.

Norwalk, Connecticut-based 365 operates 12 data centers in the eastern US and additional 21 points of presence on its 100G network. Together, the 12 data centers measure 230,000 square feet and offer 22MW of power capacity.

Related:Its zColo Acquisition Will Make DataBank a US Data Center Heavyweight

The company said it has more than 650 customers.

Most of its facilities are in secondary markets, places like Detroit, Indianapolis, and Nashville. Content and cloud providers have been increasingly turning to data center operators with footprint in such metros to improve user experience for local customers and reduce data transport costs.

Bob DeSantis, 365’s CEO, board member, and investor, will continue steering the company as its chief executive. Under his leadership, 365 added more data centers to its portfolio and expanded its services capabilities, adding cloud, managed services, and network and IP services to previously existing basic colocation, the company said in a statement.