(Reuters) - Investment firm Blackstone Group (NYSE:BX) Inc said on Monday it would take data center operator QTS Realty (NYSE:QTS) Trust Inc private in an all-cash deal worth about $10 billion.
Blackstone Funds, the buyout firm's infrastructure unit along with its non-traded real-estate income trust and other long-term perpetual capital vehicles, will pay $78 per share, which represents a premium of about 21% to QTS' closing price on Friday.
Shares of QTS rose about 21% to hit a record high of $78.24.
The equity value of the deal stands at $5.37 billion, according to Reuters calculations, based on 68.9 million outstanding shares, as of April 29.
A COVID-19 pandemic-led remote working environment boosted demand for cloud services, which are reliant on data centers. QTS has more than 7 million square feet of data center space throughout North America and Europe.
The $10-billion transaction, which is expected to close in the second half of this year, includes the assumption of the data center operator's existing debt.
The deal also includes a 40-day go-shop period, which will let QTS solicit and consider other proposals, the companies said.
Jefferies (NYSE:JEF) and Morgan Stanley (NYSE:MS) were financial advisers to QTS, while Citigroup (NYSE:C) Global Markets, Barclays (LON:BARC), Deutsche Bank (DE:DBKGn) Securities and Goldman Sachs (NYSE:GS) advised Blackstone.
The deal was first reported by the Wall Street Journal earlier in the day.