Blue Owl Buys IPI Partners’ Digital Infra Fund
Data centre financing received a fillip with leading alternative asset manager Blue Owl Capital Inc., has entered signed an agreement to acquire the business of digital infrastructure fund manager (DIF) IPI Partners (IPI) from an affiliate of ICONIQ Capital (ICONIQ) and an affiliate of Iron Point Partners (Iron Point) for a purchase price of approximately $1 billion.
The purchase price will be comprised of approximately 80% of Blue Owl equity and around 20% in cash. The acquisition is expected to close in the fourth quarter of 2024 or first quarter of 2025, subject to certain conditions including third party consents, and is expected to be neutral to Blue Owl’s earnings in 2025 and modestly accretive in 2026.
IPI has approximately $10.5 billion in assets under management as of 30 June 2024 and was founded in 2016 as a joint venture between ICONIQ and Iron Point to service the needs of large, high-quality hyper-scale and enterprise data centre users.
The IPI platform has grown into one of the largest private US-based data centre investors with a portfolio of 82 data centres comprising over 2.2GW of leased capacity across the US, EMEA and APAC.
Tenants are primarily investment grade corporations, including several Fortune 100 companies. The firm is based in Chicago, IL with over 70 team members in global offices and over 50 investment professionals. IPI’s employees are expected to join Blue Owl and will continue to manage IPI’s existing funds.
Boost to Blue Owl’s DIF
Upon closing of the acquisition, IPI’s business will further enhance Blue Owl’s digital infrastructure strategy as part of the firm’s real estate platform, which will continue to be led by Blue Owl Co-President Marc Zahr. IPI’s Managing Partner, Matt A’Hearn will become Head of Blue Owl’s digital infrastructure strategy and report to Blue Owl Co-President Marc Zahr.
An affiliate of ICONIQ will enter into an agreement with Blue Owl to provide services to Blue Owl’s business, including, but not limited to, investment analysis and investor relations. In exchange for these services, an affiliate of ICONIQ is eligible for services payments, that are subject to certain future targets. Blue Owl anticipates these payments will be made between 2026 and 2028.
Blue Owl’s Co-CEOs Doug Ostrover and Marc Lipschultz said that the acquisition of IPI with its deep sector expertise complements their existing net lease strategy while providing an ideal opportunity to expand Blue Owl’s digital infrastructure strategy.
There is a massive market opportunity to finance data centres, matched by an increasing investor appetite for additional strategies investing behind cloud and AI-driven secular tailwinds, they said.
ICONIQ’s founding partner Divesh Makan said that it has been a privilege to help build IPI over the past eight years and to secure trust with many of the largest data centres customers in the world. During this time, IPI has grown into one of the largest private developers and investors of data centres globally by solving problems for the leading global technology companies, Divesh Makan added.
IPI’s Managing Partner Matt A’Hearn said that there is a tremendous amount that IPI can accomplish within the Blue Owl ecosystem alongside their partners at ICONIQ, and look to extend their market leading position.
