QTS Realty Trust, Inc. (QTS) stock prices surged by an impressive 21.09% shortly after market trading commenced on June 7th, 2021, bringing the price per share up to USD$78.09 early on in the trading day.
Acquisition by Blackstone
The company announced on June 7th, 2021 that it had entered into a definitive agreement that will see all outstanding shares of QTS’ common stock being acquired by Blackstone. Each share has been priced at USD$78.00 per share, with the transaction being executed entirely with cash, for a total valuation of almost USD$10 billion, which includes the assumption of outstanding debt. The purchase price represents a premium of 21% to QTS’ closing share price as of June 4th, 2021, as well as a 24% premium to the volume-weighted average price of the company’s shares over the last 90 days.
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Closing of Transaction
Having been unanimously approved by QTS’ Board of Directors, the deal is expected to close in the latter half of 2021. The acquisition by Blackstone is a testament to the company’s success, with the added resources from Blackstone resulting in an expansion of the reach of data center solutions to address existing and new customers. Following the completion of the transaction, it is forecasted that QTS will continue to be led by its existing senior management team, as well as maintain its corporate headquarters in Kansas.
Included in the definitive merger agreement is a 40-day “go-shop” period which allows QTS to actively solicit and consider alternative acquisition proposals. With the period expiring on July 17th, 2021, the company has the right to terminate the definitive merger agreement to enter into a superior proposal, subject to certain terms and conditions of the definitive merger agreement with Blackstone.
Scope of Collaboration
Blackstone reiterated their focus on investing in assets that are benefitting from strong, secular tailwinds, an example of which is the rapid digitalization of data. With QTS being a leading provider of data center solutions with a stellar portfolio of high-quality assets in the desirable markets, it was an obvious candidate for Blackstone to acquire. The two companies are hopeful for the opportunities their joint resources afford them.
Future Outlook for QTS
Armed with an arsenal of additional resources from Blackstone, the QTS platform is set to skyrocket. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.