AirTrunk to be acquired for $24 billion in Blackstone's largest-ever Asia Pacific investment

The acquisition is still subject to Australian Foreign Investment Review Board (FIRB) approval.

Sydney-headquartered AirTrunk has a sizeable presence in Australia, Japan, Malaysia, Hong Kong and Singapore with more than 800MW of capacity committed to customers, as well as land that could be developed to support more than 1 GW of future growth.

AirTrunk was founded in 2016 by Robin Khuda, a former executive and founding board member at another of Australia's big names in data centre development, Brisbane-based NEXTDC (ASX: NXT).

Since 2020 the company has been majority owned by Macquarie Asset Management (MAM) and The Public Sector Pension Investment Board (PSP Investments), with its footprint expanding from five data centres in Australia, Singapore and Hong Kong to becoming a leading hyperscale data centre specialist across 11 sites, including Japan and Malaysia. 

MAM and PSP have reached a deal with a Blackstone consortium to sell the entirety of their interests in AirTrunk totalling 88 per cent of the company, while Khuda will realise "part of his stake".

"In 2015, I established AirTrunk to pioneer scalable and sustainable hyperscale data centres in the Asia-Pacific region," says Khuda, who will remain with the company as CEO.

"In under a decade, we’ve built the largest platform in the region, with data centres in all major markets operating as essential digital infrastructure underpinning the digital economy.

"Today’s announcement is a testament to the strength of our platform, vision, execution and team – the experts and innovators, trusted by our customers to deliver and operate, with a passion to ensure sustainability is at the forefront of the finance, design, build and operations of our data centres."

The acquiring consortium comprises funds managed by Blackstone Real Estate Partners, Blackstone Infrastructure Partners, Blackstone Tactical Opportunities, and Blackstone’s private equity strategy for individual investors, along with the Canada Pension Plan Investment Board (CPP Investments).

"This transaction evidences the strength of the AirTrunk platform in a strong performing sector as we capture the next wave of growth from cloud services and AI and support the energy transition in Asia Pacific," adds Khuda.

"We look forward to working with Blackstone and CPP Investments and benefitting from their scale capital, sector expertise and valuable network across the various local markets, which will help support the continued expansion of AirTrunk," he says.

Blackstone president and chief operating officer Jon Gray describes the investment as "Blackstone at its best", leveraging its global platform to capitalise on its "highest conviction theme". Blackstone currently has a US$55 billion portfolio of data centers including facilities under construction, along with more than US$70 billion in prospective pipeline development.

"AirTrunk is another vital step as Blackstone seeks to be the leading digital infrastructure investor in the world across the ecosystem, including data centers, power and related services," says Gray. 

MAM Asia Pacific co-head of infrastructure Ani Satchcroft says the transaction demonstrates MAM's ability to identify, invest in, and nurture digital infrastructure assets that are resilient, scalable and pivotal in meeting today’s burgeoning demand for data, cloud services and the adoption of artificial intelligence.

"The AirTrunk story is one of genuine partnership between MAM, PSP Investments and AirTrunk’s world class team," Satchcroft says.

"Our journey with AirTrunk, and the drive and foresight of our teams in Asia Pacific, has resulted in AirTrunk expanding its footprint across key markets in the region, achieving a more than eightfold increase in contracted capacity. 

"As the world’s largest infrastructure manager, MAM began investing in digital infrastructure more than 20 years ago. We remain committed to leveraging our global expertise and local insights to continue growing businesses and actively shaping industries, generating superior value for our investors and the communities we serve."

PSP Investments managing director and global head of infrastructure investments, Sandiren Curthan, says the partnership with MAM in AirTrunk has delivered outstanding results for its beneficiaries, and validated its investment strategy, focused on "partnering with top-tier management teams and like-minded investors to support infrastructure businesses globally in their growth ambitions while achieving operational excellence".

"Our successful collaboration with MAM and the AirTrunk management team has enabled AirTrunk to become a market-leading independent hyperscale data centre platform in Asia-Pacific from a customer experience, operational and sustainability standpoint," says Curthan.

MAM and PSP Investments have also worked alongside AirTrunk management to elevate its ESG and work health and safety (WHS) focus, with the company introducing initiatives including a sustainability linked loan – the largest by a data centre operator globally - a target of achieving 100 per cent renewable energy by 2030 through both AirTrunk and customer procurement, and a safety culture that is leading in the industry.

"The support and expertise from MAM and PSP Investments have been transformational for the company," says Khuda.

"As we enter our next phase of growth, the AirTrunk management team thank them for their outstanding partnership. For AirTrunk, this is just the beginning, as we continue to capture the significant opportunities from the region’s vibrant digital future."