Data Center M&A Reaches $57 Billion in Closed Deals
Data center mergers and acquisitions (M&A) reached unprecedented heights in 2024, with $57 billion in deals finalized throughout the year. According to Synergy Research Group, an additional $29 billion in deals were agreed upon but remain pending completion, further highlighting the sector’s explosive growth.
Major Investments Propel 2024’s Record
Among the standout transactions were two equity investments in Vantage Data Centers, collectively valued at $9.2 billion. The company’s EMEA operations also received a $3.1 billion equity injection, reinforcing its global presence. EdgeConneX and DataBank also secured significant equity investments, underscoring investor confidence in the data center market.
Comparing Trends: 2024 vs. Previous Years
The 2024 figures surpassed the previous record of $52 billion set in 2022. In contrast, 2023 saw a sharp decline, with M&A activity dropping to $26 billion. Synergy’s analysis attributes the 2022 peak to two “mega deals” valued at over $11 billion each—the acquisitions of CyrusOne and Switch.
When excluding deals worth $2 billion or more, a different pattern emerges. Under this lens, 2021 ranks as the peak year for M&A activity, followed by a 32 percent decline in 2022, a seven percent drop in 2023, and a dramatic 131 percent surge in 2024.
Private Equity Dominates M&A Activity
The report highlights the overwhelming influence of private equity in shaping the data center landscape. Since 2021, private equity has consistently accounted for 80 to 90 percent of the value of closed deals. This influx of private capital underscores the sector’s attractiveness and long-term growth potential.
Diverse Deal Types in the Data Center Sector
M&A transactions in the data center industry encompass a wide range of deal types, including:
- Company acquisitions
- Investments in joint ventures
- Minority equity investments
- Individual data center acquisitions
- Share sales
- Acquisition of land for future data center development
FAQ
1. Why was 2024 a record-breaking year for data center M&A?
The combination of high-value equity investments and sustained private equity interest drove $57 billion in closed deals, with another $29 billion still in progress.
2. What were the key drivers of 2022’s peak M&A activity?
Two mega deals—the acquisitions of CyrusOne and Switch—valued at over $11 billion each, significantly boosted the total value of transactions in 2022.
3. How does private equity impact the data center M&A landscape?
Private equity’s dominance—accounting for up to 90 percent of deal values—has been instrumental in driving growth and shaping the future of the industry.
4. What types of deals are common in the data center industry?
Common transactions include company acquisitions, joint ventures, minority equity investments, individual data center purchases, and land acquisitions for development.
5. How did 2024 compare to 2021 and 2023 in terms of M&A activity?
While 2021 saw a peak in smaller-scale deals, 2024 outperformed all prior years with a 131 percent increase over 2023, driven by larger transactions and significant private equity involvement.
Looking Ahead
The $57 billion in data center M&A deals closed in 2024 demonstrates the sector’s remarkable growth trajectory and its strong appeal to private equity investors. With $29 billion in pending deals and continued stakeholder interest, the industry is set to maintain its momentum and achieve further expansion in the near future.
