Global Switch has reached an agreement to sell its Australian business, Global Switch Australia Holdings (GSAH), to HMC Capital for £1 billion ($1.4 billion).

Global Switch aims to open the value of its economic interests in GSAH and raise capital for future growth. The deal is expected to complete by late 2024 or early 2025, pending regulatory approval in Australia.

“The proceeds from the sale of our historic economic interests in GSAH will enable us to accelerate our ambitions to meet the demand for data centre capacity in our critical hubs around the world, and to continue to ensure that our users’ needs are met as demand increases for AI and high-performance computing deployments,” said Ashley Muldoon, CEO at Global Switch.

GSAH has operated as a separate business since December 2016, while Global Switch maintained economic interests in the company. The sale is part of Global Switch’s broader capital-raising strategy, which intends to improve the company’s balance sheet and provide the resources needed to invest in new data centre developments, including the integration of advanced cooling technologies and expansion to meet growing demand for AI and high-performance computing (HPC) solutions.

Global Switch holds a strong presence across Europe and Asia-Pacific. The company provides flexible, high-density, low-latency IT capacity for leading technology organisations in key markets like London, Paris, Frankfurt, Amsterdam, Singapore, and Hong Kong.

The Global Switch Australia Holdings sale to HMC Capital follows several high-profile deals within the global data centre sector, underscoring the continued investor interest in the industry. Global Switch said its success is attributed to its ability to respond to the increasing demand for data centre capacity, driven largely by artificial intelligence (AI) and high performance computing (HPC) technologies.

Global Switch expects its investment-grade credit ratings to remain unaffected by the transaction, and approvals from the company’s banking partners are anticipated. GSAH and its subsidiaries will no longer guarantee Global Switch’s bonds and revolving credit facilities, which will remain otherwise unaffected by the deal.