SAN FRANCISCO and WASHINGTON, Sept. 14,
2017 /PRNewswire/ -- Digital Realty (NYSE: DLR),
a leading global provider of data center, colocation and
interconnection solutions, and DuPont Fabros (NYSE: DFT), a
leading owner, developer, operator and manager of enterprise-class,
carrier-neutral, multi-tenant data centers, announced today they
have completed their previously announced merger in an all-stock
transaction with an enterprise value of approximately $7.8 billion.
The addition of DuPont Fabros' high-quality, purpose-built data
center portfolio to Digital Realty's existing footprint enhances
the combined company's ability to serve its customers in the top
U.S. data center metro areas. The merger also provides
meaningful customer and geographic diversification for DuPont
Fabros shareholders from the combination with Digital Realty's
global platform.
"This highly strategic and complementary transaction further
expands our product offering, and solidifies our blue-chip customer
base," said A. William Stein,
Digital Realty's Chief Executive Officer. "This deal is
consistent with our investment criteria, and is likewise consistent
with our strategy of offering our customers the most comprehensive
set of data center solutions, from single-cabinet colocation and
interconnection, all the way up to multi-megawatt hyper-scale
deployments."
In conjunction with the merger closing, Digital Realty appointed
former DuPont Fabros Board members Michael
A. Coke and John T. Roberts,
Jr. to Digital Realty's Board of Directors. Mr. Coke
is a highly respected real estate executive, having co-founded
Terreno Realty Corporation, a publicly traded U.S. industrial REIT,
where he serves as President and as a member of the Board of
Directors. Previously, he served as Chief Financial Officer
and Executive Vice President for AMB Property Corporation, a global
developer and owner of industrial real estate focused on major hub
and gateway distribution markets. Mr. Roberts is also a
veteran real estate investor, having held various positions at AMB
Property Corporation, including President of AMB Capital Partners
LLC, a subsidiary of AMB Property Corporation responsible for AMB's
global private capital ventures.
Digital Realty also announced today the early tender results
for, and the early settlement of, the previously announced tender
offer and consent solicitation for the existing 5.875% senior notes
due 2021 issued by DuPont Fabros Technology, L.P.
As of 5:00 p.m. EDT on
September 13, 2017, holders of
approximately $475 million had
validly tendered and delivered their notes and the related
consents, which represents approximately 79% of the $600 million aggregate principal amount
outstanding. The withdrawal deadline also expired at
5:00 p.m. EDT on September 13, 2017. As a result, notes
tendered pursuant to the tender offer can no longer be withdrawn.
The issuer exercised its right to accept and to purchase and pay
for the early tender notes. Settlement occurred earlier
today, September 14, 2017,
immediately following the consummation of the merger. The
total consideration paid for each $1,000 principal amount of early tender notes was
$1,032.50 (including a $30.00 consent payment), plus accrued and unpaid
interest from June 15, 2017 up to,
but not including, September 14,
2017.
Having received the requisite consents from the holders of the
notes in the tender offer, the issuer and U.S. Bank National
Association, as trustee, executed a supplemental indenture amending
the indenture relating to the notes. The supplemental
indenture eliminates substantially all the restrictive covenants,
certain events of default and related provisions contained in the
indenture and reduces the notice periods required for redemption of
the notes as described in the offer to purchase.
The tender offer will expire at 11:59
p.m. EDT on September 27, 2017
unless extended or terminated earlier by the offeror in its sole
discretion. Holders who validly tender their notes after the
consent payment deadline, but at or prior to expiration of the
tender offer, and whose notes are accepted for purchase, will only
be eligible to receive $1,002.50 per
$1,000 principal amount of notes
tendered, plus accrued and unpaid interest from and including the
most recent interest payment date, and up to, but not including the
final settlement date, which is expected to be the business day
following the expiration of the tender offer. The complete
terms and conditions of the tender offer are set forth in the offer
documents that were previously sent to holders of the notes.
Immediately following settlement of the purchase of the early
tender notes, the issuer issued a notice of redemption for the
remaining outstanding principal amount. On September 18, 2017, the issuer expects to redeem
the remaining outstanding principal amount at a redemption price
equal to 102.938% of the aggregate principal amount of the notes to
be redeemed, plus accrued and unpaid interest up to, but excluding,
the redemption date. Holders of the notes may still
participate in the tender offer and tender their notes at or prior
to the expiration date, even though the issuer has elected to call
the remaining outstanding notes for redemption.
On September 14, 2017, the issuer
also issued redemption notices for the 5.625% senior notes due 2023
issued by DuPont Fabros Technology, L.P. On October 16, 2017, the issuer expects to redeem
35% of the notes due 2023 at a redemption price equal to 105.625%
of the aggregate principal amount of the notes to be redeemed, plus
accrued and unpaid interest up to, but excluding, the redemption
date. On October 17, 2017, the
issuer expects to redeem the remaining outstanding principal amount
of notes due 2023 at a redemption price equal to 100.000% of the
aggregate principal amount of the notes to be redeemed, plus a
make-whole premium and accrued and unpaid interest up to, but
excluding, the redemption date.
Citigroup Global Markets Inc. has been engaged as Dealer Manager
and Solicitation Agent for the tender offer. Questions
regarding the tender offer should be directed to Citigroup Global
Markets Inc. at (212) 723-6106 or (800) 558-3745. Requests
for copies of the offer documents or documents relating to the
tender offer and consent solicitation may be directed to Global
Bondholder Services Corporation, the Tender Agent and Information
Agent for the tender offer, at (866) 924-2200.
This press release does not constitute an offer to sell, or a
solicitation of an offer to buy, the notes. The tender offer
is made solely pursuant to the offer documents. The tender
offer is not being made to holders of notes in any jurisdiction in
which the making or acceptance thereof would not be in compliance
with the securities, blue sky or other laws of such jurisdiction.
Holders are urged to read the offer documents and related
documents carefully before making any decision with respect to the
tender offer. Holders of notes must make their own decisions
as to whether to tender their notes and provide the related
consents. Neither the issuer, Digital Realty, the Dealer
Manager and Solicitation Agent, the Information Agent, the Tender
Agent or the Trustee makes any recommendations as to whether
holders should tender their notes pursuant to the tender offer, and
no one has been authorized to make such a recommendation.
About Digital Realty
Digital Realty supports the data center, colocation and
interconnection strategies of more than 2,300 firms across its
secure, network-rich portfolio of data centers located throughout
North America, Europe, Asia
and Australia. Digital Realty's clients include domestic and
international companies of all sizes, ranging from financial
services, cloud and information technology services, to
manufacturing, energy, gaming, life sciences and consumer
products. https://www.digitalrealty.com/
For Additional Information:
Andrew P. Power
Chief Financial Officer
Digital Realty
(415) 738-6500
Investor Relations:
John J.
Stewart / Maria S. Lukens
Digital Realty
(415) 738-6500
investorrelations@digitalrealty.com
Media Inquiries:
Scott Lindlaw / Lindsay Andrews
Sard Verbinnen & Co
(415) 618-8750
Digital Realty-SVC@sardverb.com
Safe Harbor Statement
This press release contains forward-looking statements which are
based on current expectations, forecasts and assumptions that
involve risks and uncertainties that could cause actual outcomes
and results to differ materially, including statements related to
the conditions of the tender offer, the merger, certain dates and
public announcements or the redemption of the outstanding notes due
2021 or 2023. These risks and uncertainties include, among
others, the following: the impact of current global economic,
credit and market conditions; current local economic conditions in
the metropolitan areas in which we operate; decreases in
information technology spending, including as a result of economic
slowdowns or recession; adverse economic or real estate
developments in our industry or the industry sectors that we sell
to (including risks related to declining real estate valuations);
our dependence upon significant tenants; bankruptcy or insolvency
of a major tenant or a significant number of smaller tenants;
defaults on or non-renewal of leases by tenants; our failure to
obtain necessary debt and equity financing; risks associated with
using debt to fund our business activities, including re-financing
and interest rate risks, our failure to repay debt when due,
adverse changes in our credit ratings or our breach of covenants or
other terms contained in our loan facilities and agreements;
financial market fluctuations; changes in foreign currency exchange
rates; our inability to manage our growth effectively; difficulty
acquiring or operating properties in foreign jurisdictions; our
failure to successfully integrate and operate acquired or developed
properties or businesses; the suitability of our properties and
data center infrastructure, delays or disruptions in connectivity,
failure of our physical and information security infrastructure or
services or availability of power; risks related to joint venture
investments, including as a result of our lack of control of such
investments; delays or unexpected costs in development of
properties; decreased rental rates, increased operating costs or
increased vacancy rates; increased competition or available supply
of data center space; our inability to successfully develop and
lease new properties and development space; difficulties in
identifying properties to acquire and completing acquisitions; our
inability to acquire off-market properties; the impact of the
United Kingdom's referendum on
withdrawal from the European Union on global financial markets and
our business; our inability to comply with the rules and
regulations applicable to reporting companies; our failure to
maintain our status as a REIT; possible adverse changes to tax
laws; restrictions on our ability to engage in certain business
activities; environmental uncertainties and risks related to
natural disasters; losses in excess of our insurance coverage;
changes in foreign laws and regulations, including those related to
taxation and real estate ownership and operation; and changes in
local, state and federal regulatory requirements, including changes
in real estate and zoning laws and increases in real property tax
rates. For a further list and description of such risks and
uncertainties, see the reports and other filings by Digital Realty
with the U.S. Securities and Exchange Commission, including Digital
Realty's Annual Report on Form 10-K for the year ended December 31, 2016 and Quarterly Reports on Form
10-Q for the quarters ended March 31,
2017 and June 30, 2017.
Digital Realty disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
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SOURCE Digital Realty
