Digital Infrastructure

Insatiable DigitalBridge kicking the tires on Radius – report

DigitalBridge is reportedly among those interested in acquiring Radius Global Infrastructure, according to the financial analysts at Cowen.

"Following recent media reports that Radius Global is considering a sale, [DigitalBridge] management noted that additional investments in ground lease aggregators are 'absolutely something' DigitalBridge is considering," the Cowen analysts wrote of their recent meeting with the company's executives. "Management believes the industry has the attributes of infrastructure, adding that Landmark Dividend [a real estate investment firm owned by DigitalBridge] already gives DigitalBridge some exposure to this segment. Based on management commentary and our own channel checks, we believe DigitalBridge has interest in acquiring Radius Global."

Radius is exploring strategic options including a sale, according to a recent Bloomberg report citing people with knowledge of the matter. Radius owns the real estate under cell towers and other such digital infrastructure across 6,300 sites in over 20 countries.

(Source: Pixabay)
(Source: Pixabay)

DigitalBridge's interest in Radius certainly follows a pattern. It just announced an $11 billion agreement to take the data center company Switch private.

And that's just the latest megadeal for DigitalBridge. In recent months, the company has been involved in all kinds of transactions involving companies in the digital infrastructure space, from fiber companies like Everstream to network deployment companies like Boingo to cell tower operators in Belgium.

Radius officials have remained tightlipped regarding a potential tie up with DigitalBridge or other companies. CEO Bill Berkman said last month during his company's quarterly conference call, "I would like to acknowledge the market rumors that surfaced in the media," according to a Seeking Alpha transcript of the event. "We have a policy of not commenting on market rumors."

Importantly, a DigitalBridge acquisition of Radius would mark a slight detour from the company's primary focus on data centers. According to the Cowen analysts, DigitalBridge officials believe data centers are currently the most attractive type of digital infrastructure to acquire right now. "Management noted that each [type of asset is] seeing growth but [they] highlighted hyperscale data centers as the vertical seeing the most demand globally," the Cowen analysts noted.

Indeed, according to Cowen, DigitalBridge officials reported "record leasing activity" in data centers, and that recent contracts have contemplated weekly data traffic at levels previously seen on a yearly basis.

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Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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