Blackstone Anchors EQT's EdgeConnex Secondary Deal
Blackstone Strategic Partners is leading a GP-led secondary transaction for EdgeConnex, a data center operator owned by EQT. The deal utilizes an evergreen continuation vehicle to provide liquidity to existing limited partners while allowing EQT to continue managing the asset. The transaction is indicative of a booming and increasingly complex secondaries market that sponsors are using to navigate a challenging exit environment.
- EQT first acquired EdgeConnex in 2020 for $2.6 billion from an investor group led by Providence Equity Partners. - Since the initial acquisition, the investment has generated a 35.5% net internal rate of return and a 3.3x net total value to paid-in capital, according to data from co-investor New York City Employees' Retirement System. - The new continuation vehicle, advised by Campbell Lutyens, is targeting up to $2 billion in its first stage and is designed as an open-ended structure to fund the data center operator's long-term expansion. - Since EQT's takeover in 2020, EdgeConnex has more than tripled its capacity, expanding its global footprint to 80 data centers in operation or development across more than 50 markets. - The transaction involves three separate EQT funds—EQT Infrastructure IV, V, and VI—which all hold stakes in EdgeConnex and will roll their interests into the new vehicle. - This deal is part of a record-breaking year for GP-led transactions, which saw global volume reach $106 billion in 2025, with 25 deals closing at $1 billion or more. - The move is designed to capitalize on accelerating demand in the data center sector, where the rise of AI is expected to help double global capacity between 2025 and 2030. - In September 2024, EQT sold a minority stake in EdgeConnex to Sixth Street Partners to help accelerate growth, but remained the largest shareholder.
