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Digital Realty, DuPont merger to be 'somewhat seamless integration,' exec says


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Digital Realty, DuPont merger to be 'somewhat seamless integration,' exec says

Digital Realty Trust Inc. and DuPont Fabros Technology Inc. had explored a combination for several years prior to the June 9 merger deal announcement, which came together rapidly over a three-month period, Digital Realty executives said.

On a conference call, Scott Peterson, Digital Realty's chief investment officer, cited the company's focus in recent years on expanding the colocation and connectivity side of its business as a principal reason a deal did not manifest earlier. The "economics" also were not as attractive as they are today, he said.

Peterson said "a couple of casual conversations" about a merger began between the companies about 90 days ago and "warmed up and really got very serious" in the last 30 days. The two had an exclusivity agreement in place for "several weeks," he added.

"From an integration standpoint, I think we're viewing this as being a somewhat seamless integration," Peterson said. "We're obviously in all of these markets. We know the buildings, the physical structures. We know the customers. We know the operations. So we view that as being a fairly straightforward process."

CEO Bill Stein said the two companies' individual relationships with key tenants like Facebook and Microsoft will not likely be compromised by the merger. The reaction among them has already been "quite positive," he said.

"Our customers, and the desire to better serve them through more offerings and more locations, are the key reason and the primary strategic rationale for doing this deal," Stein said.