AT&T Transferring Data Center Operations To Brookfield For $1.1B Following Time Warner Deal


AT&T is handing off more than 30 data center co-location operations and assets to Brookfield Infrastructure in a strategic alliance where the telecom carrier will receive $1.1 billion.

The deal comes one week after AT&T completed its $85.4 billion blockbuster acquisition of Time Warner. AT&T said it will receive $1.1 billion from the Brookfield deal, which it will use to pay down debt.

Dallas-based AT&T will transfer 18 data centers in the United States and 13 outside the country to Brookfield Infrastructure, a division of asset management investor Brookfield Asset Management.

[Related: 5 Things Partners Need To Know About The AT&T/Time Warner Merger]

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The deal allows AT&T to continue to offer co-location services through Brookfield as an active sales channel for the business and AT&T will be the anchor tenant of the co-location operations. The transfer is expected to close within six to eight months.

A long battle between AT&T and the Department of Justice regarding the Time Warner deal came to an end this month when U.S. District Court Judge Richard Leon gave the go-ahead for the mega-merger. The judge did not impose conditions on the merger's approval, which AT&T finalized on June 14, although the DoJ can still appeal the decision.

Toronto-based Brookfield is one of the world’s largest investors, owners and operators of infrastructure assets globally, with more than $75 billion in assets under management across the communications infrastructure, utilities, transport, energy, renewable power, and sustainable resources sectors.

Brookfield said it is establishing a wholly-owned company to own and operate the data center assets. The company will appoint Tim Caulfield as CEO of the business. Caulfield is currently CEO of IT management consultancy firm Antara Group, which focuses on Internet-as-a-Service.

Brookfield has a market cap of $40 billion. The company's stock was flat Thursday morning at $41.31 per share.