A top board member of DigitalBridge – an investment firm focused heavily on the telecom industry – announced he resigned from the company's board of directors after being charged by the US government for acting as an unregistered foreign agent for the United Arab Emirates.
The development represents what may well be a final break between the company that Tom Barrack founded in 1991 and the company that today calls itself DigitalBridge and owns investments in cell tower, small cell and data center companies ranging from Zayo to Boingo to Vertical Bridge to ExteNet Systems to DataBank.
"On July 20, 2021, Thomas J. Barrack, Jr. resigned as a member of the board of directors of DigitalBridge Group, Inc. (the "Company"). Mr. Barrack's decision was not the result of any disagreement with the Company on any matter relating to its operations, polices or practices," DigitalBridge wrote in an SEC filing Wednesday morning.
That's good news for investors, according to the financial analysts at B. Riley Securities.
"In our view, his voluntary resignation was the best outcome for the company, both as it relates to removing any lingering headline risk and accelerating the timeline for his departure," they wrote in a note to investors. "In our estimation, there had been widespread shareholder dissatisfaction with his continued presence on the board, even in a limited role. As such, his voluntary resignation should be viewed as a net positive for the company."
Barrack founded Colony Capital almost 30 years ago and grew it into one of the biggest names in private equity through investments into a wide range of areas including real estate. As noted by Axios, under Barrack's leadership it also bought some funds from scandal-plagued, UAE-based private equity firm Abraaj Capital.
However, Barrack has been stepping away from the company since cell tower vetreran Marc Ganzi joined Colony Capital in July 2019. Ganzi has been shedding the company's real estate investments in order to focus exclusively on "digital infrastructure" like cell towers, small cells and data centers. He recently completed Colony Capital's rebrand into DigitalBridge.
Barrack is a longtime friend of former president Donald Trump and was chair of his 2017 inaugural fund. The US Department of Justice this week charged Barrack with attempting to advance UAE interests by influencing foreign policy positions of Trump's 2016 campaign and subsequent administration. It also accuses Barrack of obstructing justice and making multiple false statements to federal law enforcement agents in 2019.
According to Axios, Barrack will plead not guilty.
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