Information on the Target

Firstcolo datacenters GmbH, based in Frankfurt, is a prominent provider of data center services including colocation, dedicated servers, managed services, and private cloud solutions. Founded in 2007, the company operates two state-of-the-art Tier III+ data centers that are entirely powered by green electricity. In 2017, firstcolo expanded its capabilities through the acquisition of Accelerated IT, significantly bolstering its market presence.

Under the guidance of its recent majority shareholders, EMERAM Capital Partners and diva-e Excellence GmbH, firstcolo has seen substantial growth, particularly in revenues and profitability. The company has effectively leveraged its robust colocation services while simultaneously entering new, high-growth segments, such as private cloud solutions, which have become increasingly important in the current market landscape.

Industry Overview in Germany

The data center industry in Germany is characterized by rapid growth, driven by the increasing demand for reliable colocation and cloud services. As more businesses turn to digital solutions, the need for efficient, secure, and sustainable data centers has never been more critical. The German market is particularly attractive due to its strong regulatory framework, which promotes green energy initiatives and data protection laws.

Germany's commitment to sustainability resonates throughout its data center sector, where many facilities now operate on renewable energy sources. The demand for energy-efficient data centers continues to rise, creating opportunities for companies that prioritize environmental responsibility. This shift towards sustainable infrastructure presents a significant advantage for firstcolo as they emphasize their green energy initiatives.

Furthermore, as German SMEs increasingly adopt digital solutions, the demand for innovative data infrastructure has surged. This trend is expected to persist, creating a favorable environment for companies that can offer flexible, scalable, and efficient data solutions. As a result, firstcolo's positioning as a leading player in Frankfurt positions it well to capitalize on these emerging opportunities.

With an ever-growing need for digital services and infrastructure, it is clear that the data center market in Germany is poised for continued expansion, providing a ripe landscape for investments aimed at capturing this growth.

The Rationale Behind the Deal

The acquisition of firstcolo by Cube Infrastructure Managers is a strategic move aimed at expanding Cube's portfolio in the rapidly growing digital infrastructure space. Firstcolo's established presence in the Frankfurt market, along with its commitment to sustainable practices, aligns perfectly with Cube's investment strategy focused on long-term growth and value creation.

This deal enhances Cube's ability to address the increasing needs of German SMEs for colocation and cloud services. By tapping into firstcolo's strong management team and innovative service offerings, Cube seeks to support the company in its ambition to scale further and enhance operational efficiencies.

Information about the Investor

Cube Infrastructure Managers is an independent mid-market infrastructure investor with a strong track record in sustainable and responsible investments. The firm focuses on generating long-term value by investing in essential infrastructure projects across various sectors, including digital, transport, and energy. Since 2008, Cube has completed numerous successful transactions in the digital sector, positioning itself as a key player in facilitating growth in this critical area.

With a keen understanding of market trends and customer needs, Cube aims to partner with visionary management teams to unlock their full potential. The firm’s commitment to sustainability and operational excellence further underscores its strategy to invest in businesses that address the megatrends shaping the infrastructure landscape.

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The decision by Cube Infrastructure Managers to acquire firstcolo datacenters GmbH represents a promising investment opportunity. With the ongoing demand for digital solutions and sustainable infrastructure, firstcolo stands out as a robust player in the data center market. The company's impressive growth trajectory, particularly in the colocation and private cloud sectors, reinforces its potential for continued expansion.

Furthermore, firstcolo’s operational efficiency, highlighted by its commitment to green energy, positions it favorably within a competitive landscape that increasingly prioritizes sustainability. Cube’s decision to partner with experienced founders and management further enhances the likelihood of successful execution of growth strategies.

While investments in infrastructure may carry inherent risks related to market fluctuations and technological advancements, the fundamental need for reliable and secure data services remains unwavering. Given firstcolo's established market presence and strategic focus on innovation, this acquisition aligns well with Cube's long-term vision.

In conclusion, the acquisition of firstcolo is likely to be a beneficial investment for Cube, as it taps into critical growth areas of the German data center market. The collaboration is expected to drive both companies towards impressive growth and sustainable practices, consequently maximizing value for all stakeholders involved.

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