American Tower Corporation (NYSE: AMT), one of the largest global REITs with a portfolio of more than 214,000 communications sites, has acquired CoreSite for $170.00 per share in cash. The total price for the deal is approximately $10.1 billion, which includes the assumption and/or repayment of CoreSite’s existing debt upon completion.
CoreSite generated annualized revenue and Adjusted EBITDA of $655 million and $343 million, respectively, in Q3 2021, with 25 data centers, 21 cloud on-ramps, and over 32,000 interconnections in eight major U.S. markets.
Over the last five years, CoreSite has had double-digit yearly revenue growth and is managed by a seasoned management team that has created leadership positions and a vital presence with cloud service providers (CSPs). According to American Tower Corporation, this will put CoreSite’s operations in a strong position for future organic development.
The deal, which was unanimously approved by both companies’ boards of directors, is expected to create a differentiated, comprehensive, and interconnected communications real estate platform that will be well-positioned to benefit from the convergence of wireline and wireless networks as global 5G deployments accelerate.
Digital Transformation
American Tower plans to use its strong financial position to advance CoreSite’s promising development pipeline in the United States, while also assessing the potential for worldwide data center expansion.
American Tower and CoreSite believe the merged firm to be well-positioned to handle growing customer demands through an expanded value proposition for network and cloud providers, service integrators, and corporate clients, thanks to increased scale and a broader, more complete offering.
The merged firm is expected to be more able to provide “great” service and extended solutions to clients by merging the expertise, talent, and resources of American Tower and CoreSite. Furthermore, the merged firm would be positioned to service client demands in additional areas thanks to American Tower’s global network.
“We are in the early stages of a cloud-based, connected and globally distributed digital transformation that will evolve over the next decade and beyond. We expect the combination of our leading global distributed real estate portfolio and CoreSite’s high quality, interconnection-focused data center business to help position American Tower to lead in the 5G world,” said Tom Bartlett, Chief Executive Officer (CEO) at American Tower. “As the convergence of wireless and wireline networks accelerates and classes of communications infrastructure further align, we anticipate the emergence of attractive value creation opportunities within the digital infrastructure ecosystem. We look forward to welcoming CoreSite’s talented team to American Tower and working together to capitalize on those opportunities to drive enhanced long-term value creation for our customers and shareholders as we continue to connect billions of people across the globe.”
“We are excited to partner with American Tower to expand its communications infrastructure ecosystem and accelerate its edge computing strategy through the addition of CoreSite’s differentiated portfolio of U.S. metro data center campuses. The combined company will be ideally positioned to address the growing need for convergence between mobile network providers, cloud service providers, and other digital platforms as 5G deployments emerge and evolve,” said Paul Szurek, Chief Executive Officer (CEO) at CoreSite. “In addition, we expect the enhanced scale and further geographic reach to provide a platform for the combined company to accelerate its growth trajectory and expand into additional U.S. metro areas, as well as internationally, leveraging American Tower’s extensive presence across the globe. CoreSite’s outstanding team, interconnection platform and data center campus portfolio are a highly complementary fit with American Tower’s existing communications sites, and we believe this partnership delivers significant value to CoreSite’s stockholders and will create an exciting new chapter for our customers, employees and partners.”
The announcement follows the news of American Tower acquiring DataSite, a colocation provider with facilities positioned in Atlanta and Orlando, Florida.
