SoftBank to buy DigitalBridge in $4 billion deal to boost AI infrastructure

SoftBank Group said on Monday that it will buy digital infrastructure investor DigitalBridge Group in a deal worth $4 billion. The Japanese investment firm is making the move as it tries to expand its portfolio in artificial intelligence.

After the news, DigitalBridge shares went up about 9.7 percent to $15.27 on Monday. The stock had already jumped 45 percent earlier this month after Bloomberg News first reported that the companies were in talks.

SoftBank is offering $16 per share. That is a 15 percent premium over DigitalBridge’s closing price on Friday. The offer values DigitalBridge at $2.92 billion. The deal is expected to be completed in the second half of next year.

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SoftBank’s founder Masayoshi Son wants to take advantage of the growing demand for computing power that AI applications need. Nonetheless, after the sale, SoftBank’s influence over the overall hardware- and software-as-a-service market still amounts to less than 10 percent.

DigitalBridge supports the digital infrastructure such as the data centers, cell towers, fiber networks, small-cell systems, and edge infrastructure. Its portfolio includes Vantage Data Centers, Zayo, Switch, and AtlasEdge.

The company started in 1991 as Colony Capital, focused on real estate. Under CEO Marc Ganzi, it shifted to digital infrastructure. It rebranded as DigitalBridge in 2021 after selling most of its old property assets. Ganzi will continue to lead DigitalBridge as a separate platform.

As of September 30, DigitalBridge managed about $108 billion in assets. That makes it one of the largest investors dedicated to the digital ecosystem.

DigitalBridge is also investing billions in the Stargate project. The project is focused on large-scale computing and infrastructure to support advanced AI. Other investors in the project include OpenAI, Oracle, and Abu Dhabi-based tech investor MGX.

In September, OpenAI, Oracle, and SoftBank said they plan to build five new computing sites in Texas, New Mexico, and Ohio. Together, these sites are expected to have around seven gigawatts of power when they are up and running.