Digital Realty Just Paid a 45% Premium for a Stake in a Rival Data Center Stock
Two days after a guidance cut sent NEXTDC reeling, a trust co-owned by Digital Realty came knocking with an offer the target calls a raid. The buyers say they have no takeover plans, but they kept the door open.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
NEXTDC is Australia’s listed data center operator. On November 4, 2026, a trust owned equally by Digital Realty (NYSE:DLR) and Australia’s Goodman Group offered A$9.50 per share for up to 9.9% of NEXTDC. That price was a 45.5% premium to NEXTDC’s Wednesday close, which works out to roughly A$6.53.
Digital Realty acted with a partner: the buyer was Ackland Investments No.1 Pty Limited, trustee of the jointly owned vehicle, but nothing has been confirmed as paid, because NEXTDC says it does not know how the aftermarket book build turned out. A book build is a broker-run process that collects sell orders from institutions at a set price.
The deal’s reported size is about A$715 million, or US$501.14 million. If the order fills completely, Digital Realty’s half comes to roughly A$357.5 million, or about US$250.6 million. Digital Realty shares rose 2.56% to $184.86, but NEXTDC’s release came out after the U.S. close, and nothing links that gain to the stake.
What the Trust Has Committed To
The only firm part is an offer at a fixed price, limited at 9.9%. Speaking through their broker, Goodman and Digital Realty said they do not intend to submit a control proposal or takeover bid at this time. They reserve the right to do so.
NEXTDC called the move a share raid and described it as opportunistic, since it was open only to institutions and arrived two weeks after NEXTDC’s October 21 guidance cut. Its board says it has received no takeover proposal and would consider any bona fide approach on its merits. It has hired Barrenjoey and UBS as joint lead advisers. Digital Realty and Goodman did not immediately comment.
NEXTDC opened 45.8% higher at A$9.52 on Thursday in Australia, then traded at A$9.34, up nearly 43%. Before that jump, the stock had fallen more than 40% in 2026.
Why Offer a Premium Right After a Guidance Cut
NEXTDC lowered its fiscal 2027 net revenue guidance to A$475 million to A$500 million, down from A$615 million to A$640 million. It cut underlying EBITDA guidance to A$245 million to A$265 million from A$385 million to A$410 million. The main cause was a delay in grid power at its M3 Melbourne site, after the distributor Jemena suspended parts of its network work in response to community opposition.
In our view, the cut reflects a power constraint above all. NEXTDC paused new projects while still holding A$8,675 million of liquidity. A buyer at a low price gets a footing in scarce, connected capacity, along with a position that would count if a bid ever appears.
U.S. data center stocks also moved on Wednesday. CoreWeave (NASDAQ:CRWV) fell about 9%, and IREN (NASDAQ:IREN) dropped about 11.2% as Democratic midterm wins raised expectations of tighter data center scrutiny. Meanwhile, Digital Realty and Equinix (NASDAQ:EQIX) rose.
What Changes for Digital Realty Shareholders
Against a $68.58 billion market cap, Digital Realty’s possible share is small. The stake would remain a minority, unconsolidated position. It brings currency exposure, the chance of pressure to put in more money later, and the reputational cost of a move the target calls a raid.
It does fit the company’s push into Asia-Pacific. Third-quarter leasing there beat the region’s prior record by more than 600%, helped by a large lease in Sydney. The AI expansion is what makes that connected capacity so valuable right now, and the suppliers behind the data centers, power, cooling, and networking are the subject of a free report we put together here.
How Digital Realty’s Own Business Outweighs the NEXTDC Stake
Digital Realty’s own business carries far more weight than NEXTDC, which remains a small position. The company carries a record $2.5 billion backlog, and its 1.5 gigawatts under construction are 63% pre-leased at an expected 11.6% stabilized yield.
Equinix offers a useful comparison, since it gained 3.91% on Wednesday. However, it is up 39.66% this year compared with Digital Realty’s 21.92%, so more of the good news is already priced in.
NEXTDC’s annual meeting on November 20, 2026, where it will release its capex review, is the next date to check. If a full disclosure is followed by a control proposal that needs far more Digital Realty capital, the case for Digital Realty would look different.
Contact [email protected] for any questions or corrections.
Omor Ibne Ehsan is a writer at 24/7 Wall St. He is a self-taught investor with a focus on growth, cyclical, and dividend equities that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as penny stocks.
