SYDNEY: Spark New Zealand has agreed to sell a 75% stake in its data center business to Pacific Equity Partners (PEP). The deal values the business at up to $705 million.
This sale is intended to provide a funding pathway for Spark’s planned data center development pipeline of over 130MW+.
Spark will retain a 25% interest in the business and expects to receive approximately $486 million in cash proceeds at the deal’s completion, with a possibility of an additional $98 million by the end of 2027 based on performance. The proceeds will be used to reduce Spark’s net debt.
The data center business will be moved into a new, separate company, temporarily called “DC Co,” which will have its own management, board, and debt financing.
According to Spark CEO Jolie Hodson, DC Co currently has over 23MW of built capacity across 11 data centers in New Zealand, with plans for a new development in Auckland and extensions at its Takanini site.
The partnership with PEP is expected to help DC Co capture a significant share of the growing data center market in New Zealand and attract international customers.
The transaction is subject to regulatory approvals, including from the Overseas Investment Office, and is expected to be completed by December 31, 2025. Jarden is serving as the financial advisor to Spark for the transaction.