Under the deal, Brookfield will set up a wholly owned company to own and operate the data centers with Tim Caulfield as chief executive. Caulfield is currently chief executive of Antara Group, a consulting firm specializing in technology infrastructure. AT&T said Caulfield’s leadership team will include AT&T veterans.
Brookfield, a publicly traded company, has said infrastructure to support the movement and storage of data would be a key driver of growth over the next decade.
Last fall, Chief Executive Sam Pollock said data is, “the fastest growing commodity in the world, with global usage growing exponentially, which requires massive investment in networks to store and transmit it, like fiber and telecom, where we have already made investments and remain focused on growing our portfolios.”
AT&T said the business will continue to deliver co-location services to customers in 18 internet data centers in the United States and 13 outside the United States. The co-location data center operations serve a diversified customer base of more than 1,000 companies.
As part of the deal, AT&T will become an active sales channel for the business and will be the anchor tenant of the co-location data-center operations. AT&T said it will continue to offer customers access to colocation services at more than 350 data centers.
The data centers are used by third parties who rent space to run their servers.
AT&T said it will use revenue from the deal to pay down debt. Its total debt load was about $163 billion in the first quarter of 2018, and that number could rise to more than $185 billion after it assumes Time Warner’s debt following the close of the companies’ merger, according to Forbes.
AT&T Communications is a business unit of AT&T Inc.
The Brookfield transaction is expected to close in six to eight months.
According to Brookfield’s website, the company’s objective is to generate a long-term return of 12% to 15% on equity while targeting annual distribution growth of 5% to 9%.