Global Switch Secures £425M Credit Facility as it Pushes into Chinese Data Center Market

Deal follows acquisition of 49 percent stake in data center provider by Chinese investor consortium

Data Center Knowledge

February 23, 2017

2 Min Read
Global Switch Secures £425M Credit Facility as it Pushes into Chinese Data Center Market
Global Switch’s Sydney East data center (Photo: Global Switch)

Global Switch, the London-based wholesale data center giant focused on European and Asia-Pacific markets, has closed a £425 million credit facility with an international bank syndicate, up £50 million from its previous borrowing arrangement, the company announced this week.

Global Switch, the world’s second-largest wholesale provider by market share, is gearing up for another expansion phase, after a consortium of Chinese companies bought a 49 percent stake in it last December for £2.4 billion.

The consortium, called Elegant Jubilee, is now splitting control of the company (albeit unevenly) with Aldersgate Investments Limited, which is owned by Reuben Brothers, the investment and development firm of the famous British billionaires David and Simon Reuben. Simon Reuben sits on the data center company’s board. Global Switch expects the consortium to give it access to Chinese telcos and internet companies looking to expand outside of China.

Elegant Jubilee was put together by Li Qiang, a Chinese telecommunications and internet entrepreneur who holds a stake in the Chinese data center provider Daily-Tech Beijing. Investors in the consortium include China’s largest privately owned steel company, Jiangsu Sha Steel Group, Singapore-based asset manager AVIC Trust, as well as institutional investors Essence Financial and Ping An Group.

As part of the acquisition announcement in December Global Switch said China Telecom Global had pre-leased space in Global Switch data centers under construction in Hong Kong and Singapore. That deal was done through Li’s Daily-Tech, which will also act as China Telecom’s service provider in the Singapore data center.

See also: Hong Kong: China's Data Center Gateway to the World

Daily-Tech and Global Switch are also in talks with China Mobile about services in Global Switch data centers, although no specific deal has been announced.

The bank syndicate behind the new credit facility consists of HSBC, Barclays, Credit Suisse, and Deutsche Bank, as well as a new lender, Bank of China.

Global Switch had 7.7 percent share of the global wholesale data center colocation market in 2016, making it second only to San Francisco-based Digital Realty Trust, whose market share was 20.5 percent, according to Structure Research.

Read more: Here are the 10 Largest Data Center Providers in the World

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