DigitalBridge Skyrockets Over 40% on SoftBank Advanced Acquisition Talks
The digital infrastructure firm, managing a $108 billion portfolio, could be acquired by the Japanese conglomerate as part of its major push into AI-related investments.
Shares of DigitalBridge Group Inc. (NYSE: DBRG) surged more than 44% in pre-market trading on Monday following reports that SoftBank Group Corp. is in advanced discussions to acquire the digital infrastructure investment firm. The potential deal, which could be announced as soon as today, marks a significant move by the Japanese technology conglomerate to deepen its investments in the data-centric infrastructure underpinning the artificial intelligence boom.
DigitalBridge, a Boca Raton, Florida-based firm, manages a sprawling $108 billion portfolio of assets, including data centers, cell towers, and fiber networks—the essential backbone of the digital economy. The firm's stock leaped to $20.10 in pre-market activity, a substantial premium on its previous closing price, reflecting investor optimism for a buyout. The company currently has a market capitalization of approximately $2.71 billion.
The reported acquisition aligns with SoftBank's recent strategic pivot towards AI, a vision championed by its founder and CEO, Masayoshi Son. As AI applications consume ever-increasing amounts of data and computing power, the demand for data centers is expected to grow exponentially. According to reports, SoftBank is looking to leverage DigitalBridge's extensive and specialized portfolio to solidify its position in this critical sector.
While neither company has officially confirmed the talks, sources close to the matter have indicated that negotiations are in a late stage. The structure and financial terms of the potential transaction have not yet been disclosed. Analysts have speculated on a wide range of potential acquisition prices, with some estimates going as high as $35 per share. The current analyst consensus price target for DBRG sits at $17.83.
The potential acquisition of DigitalBridge follows a series of strategic moves by the company. Formerly known as Colony Capital, the firm underwent a significant transformation, shedding its legacy real estate assets to focus purely on digital infrastructure. This pivot has positioned DigitalBridge as a pure-play investment manager in one of the market's hottest sectors.
For SoftBank, this deal would represent a major investment in the U.S. digital infrastructure market. The Japanese investment giant is reportedly nearing a deal for the data center investment firm, which would add a significant portfolio of high-demand assets to its Vision Fund. The move is seen as a way for SoftBank to capitalize on the AI trend, which has already handsomely rewarded chipmakers like Nvidia and enterprise software companies like Oracle.
Investors will be closely watching for an official announcement. Should the deal materialize, it would be one of the most significant transactions in the digital infrastructure space this year, underscoring the immense value being placed on the physical assets that power the digital world. The acquisition would provide SoftBank with a robust platform to benefit from the long-term, secular growth of data consumption and AI development, while offering DigitalBridge shareholders a substantial, immediate return on their investment.