BOCA RATON, Fla. - DigitalBridge Group, Inc. (NYSE: DBRG), a global digital infrastructure investment firm, has announced the acquisition of a 75.62% controlling interest in JTOWER Inc. (TSE: 4485), a Japanese digital infrastructure provider. The transaction, valued at JPY 70.1 billion, was completed through DB Pyramid Holdings, LLC, a special purpose entity owned by funds managed by DigitalBridge's investment management platform.
The tender offer for JTOWER's common shares and stock acquisition rights began on August 15, 2024, and concluded on October 10, 2024. DigitalBridge's strategy includes taking JTOWER private alongside Cultive, an asset management company led by JTOWER’s Representative Director Atsushi Tanaka. The delisting process from the Tokyo Stock Exchange is anticipated to be finalized in Q1 2025.
Justin Chang, Senior Managing Director and Head of Asia at DigitalBridge, expressed enthusiasm about the investment, highlighting JTOWER's role in supporting next-generation digital networks in Japan. The partnership aims to accelerate JTOWER's growth, expand its presence, and enhance connectivity across the country.
Atsushi Tanaka of JTOWER echoed the positive sentiment, anticipating that DigitalBridge's strategic expertise and financial support will boost JTOWER's capital efficiency and promote infrastructure sharing advancements in Japan.
This move expands DigitalBridge's global digital infrastructure portfolio, emphasizing the firm's commitment to fostering growth and innovation in strategic markets. With DigitalBridge's global resources, JTOWER is expected to strengthen its leadership position and respond to Japan's increasing digital infrastructure demands.
DigitalBridge manages over $84 billion in digital infrastructure assets, including cell towers, data centers, fiber, and edge infrastructure. JTOWER specializes in telecommunication towers and in-building solutions, aiming to improve mobile network connectivity and efficiency in Japan.
The information in this article is based on a press release statement.
In other recent news, DigitalBridge Group Inc. reported strong Q2 2024 results, with an 18% year-over-year increase in management fee revenues. The company raised $14 billion in capital this year, 80% of which is allocated for data center investments, and it plans to raise an additional $7 billion by year's end. Notably, the company's global data center portfolio is set to expand from 4 gigawatts to 7.5 gigawatts over the next five years to meet the growing demand for AI infrastructure.
In response to these developments, Truist Securities revised its price target on DigitalBridge shares to $17.00, maintaining a Buy rating. However, Deutsche Bank reduced its price target to $16, while still recommending a Buy rating. TD Cowen, on the other hand, reaffirmed its Buy rating on DigitalBridge shares, maintaining a steady price target of $19.
These adjustments come after the company's recent earnings report and insights shared by DigitalBridge's CEO Marc Ganzi at the 10th Annual TD Cowen Communications Infrastructure Summit. The firm's Fee Related Earnings (FRE) for 2024 and 2025 were also revised, with an anticipated increase in realized principal income contributing to higher Distributable Earnings (DE) per share estimates for both years. These recent developments underscore the company's strategic positioning within the AI and digital infrastructure sectors.
InvestingPro Insights
As DigitalBridge Group (NYSE: DBRG) expands its global digital infrastructure portfolio with the acquisition of a controlling stake in JTOWER, investors may find additional context from recent financial data and analyst insights valuable.
According to InvestingPro data, DigitalBridge's market capitalization stands at $2.8 billion, reflecting its significant presence in the digital infrastructure space. The company's revenue for the last twelve months as of Q2 2024 was $1.06 billion, with an impressive revenue growth of 294.62% over the same period. This substantial growth aligns with the company's strategic acquisitions and expansion efforts, such as the JTOWER deal.
InvestingPro Tips highlight that DigitalBridge has been profitable over the last twelve months, with analysts predicting continued profitability this year. This financial health supports the company's ability to pursue large-scale acquisitions like the JTOWER transaction. Additionally, the stock has shown a strong return over the last three months, with InvestingPro data indicating a 15.14% price total return over that period.
However, investors should note that analysts anticipate a sales decline in the current year, which could be a factor to watch as DigitalBridge integrates its new acquisition. The company's P/E ratio of 6.68 suggests it may be trading at a relatively low earnings multiple, potentially indicating an attractive valuation for investors interested in the digital infrastructure sector.
For those seeking a more comprehensive analysis, InvestingPro offers additional tips and insights on DigitalBridge Group, with 9 more tips available on the platform.
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