Infrastructure-focused investment firm I Squared Capital is in advanced talks to acquire Kio Networks, a data center operator in Mexico and Central America, people with knowledge of the matter told Bloomberg.
The valuation of the transaction could not be known immediately and, as with any deal that has not been finalized, it is possible that the conversations collapse.
Kio, backed by billionaire María Asunción Aramburuzabala’s family office, Tresalia Capital, began exploring a sale last summer that could value the company at up to $ 1 billion, Bloomberg News reported in August.
A spokesperson for I Squared declined to comment, while another for Kio said the company has not finalized a sale agreement and declined to comment further.
A deal for Kio would be the latest indicator of continued interest from institutional investors in the sector. Earlier this month, affiliates of Blackstone Group Inc. agreed to buy data center operator QTS Realty Trust Inc., and Singapore’s Mapletree Industrial Trust, which has Temasek as a shareholder, bought a data center portfolio from Sila. Realty Trust. This month, Singapore’s sovereign wealth fund GIC agreed to additional joint ventures with Equinix Inc.
Kio operates 40 data centers in Mexico, Panama, Guatemala, the Dominican Republic and Spain. Moody’s Investors Service wrote in an August note that while the coronavirus pandemic presents risks to the company, “its effect on operating metrics will be milder than we anticipated at the start of the virus outbreak.”
The Mexican government is Kio’s main customer, accounting for nearly 50% of its revenues, exposing it to late payment risks, Moody’s said.
The Aramburuzabala family’s wealth originated in large part from the sale of its stake in the brewery Grupo Modelo SAB, the maker of Corona and Negra Modelo, to Anheuser-Busch InBev SA as part of an approximately $ 20 billion transaction in 2013.
Aramburuzabala, along with her sister Lucrecia, inherited the stake in Modelo after her father, Pablo, died in 1995.
