Highline do Brasil, a portfolio company of Digital Colony Partners I, today received additional backing from Canadian pension fund, Alberta Investment Management Corporation (AIMCo), which is increasing its stake in Highline from 10.2% to 20%.

Additionally, AIMCo intends to make a follow-on investment in Highline do Brasil of an undisclosed amount. In turn, this investment will increase AIMCo’s ownership in the company beyond 20%. Notably, Digital Colony will maintain control of Highline do Brasil upon completion of the AIMCo follow-on investment.

Highline do Brasil – Background

After acquiring Highline do Brasil from Pátria Investments in December 2019, Digital Colony has quickly scaled the platform to have 3.3k towers in Brazil. This growth was driven by bolt-on acquisitions, in November 2020, of Phoenix Tower do Brasil and Oi’s UPI Torres unit. Including pending build-to-suit (BTS) programs and towers which the company has marketing or management rights for, Highline’s portfolio will soon grow to 4.1k towers in Brazil.

Potential Use of Proceeds – Highline do Brasil

In 2021, Brazil is experiencing a surge in digital infrastructure M&A announcements. Specifically, BTG, CDPQ, and IHS (twice), are among the institutional investors actively deploying capital in the country. Moreover, there remains a significant pipeline of digital infrastructure opportunities, two of which could be potential destinations for AIMCo’s capital.

(1) Oi SA’s Fiber Optic Infrastructure – SPC InfraCo

Highline do Brasil, with Digital Colony’s backing, and AIMCo could pursue a joint over-bid to BTG’s binding offer for Oi’s SPC InfraCo. Indeed, Digital Colony has not yet acquired a scaled fiber platform in Brazil with Highline (towers) and Scala (Data Centers) being in adjacent digital infrastructure sectors.

Importantly, Highline do Brasil has previously transacted with Oi when it acquired its UPI Torres unit.

(2) Grupo TorreSur

Grupo TorreSur, Brazil’s third largest independent tower company, which has 6.0k tower sites in Brazil is seeking-out buyers. Indeed, this could present an opportunity for Highline do Brasil to triple the size of its towers business in Brazil.

Alberta Investment Management Corporation (AIMCo) – Overview

Alberta Investment Management Corporation (AIMCo) is a Canadian pension fund with more than $118bn Canadian dollars under management. Overall, AIMCo invests in private equity, real estate, forestry assets, and infrastructure, on a global basis.

To-date, AIMCo has only made one investment in Brazil, in which it has an ownership interest greater than 20%. Specifically, this investment is in Iguá Saneamento SA which operates water supply and sewage treatment systems. Therefore, Highline do Brasil is the first significant digital infrastructure investment for Alberta Investment Management Corporation (AIMCo) in Brazil.

Adam Simmons is the Founder & CEO of Dgtl Infra. He started his career with an S&P 500-listed big box retailer, in an operations management role. Adam's entrepreneurial "itch" led him to start a 5G-driven company, focused on innovative retail solutions using augmented reality and shoppable videos, which was eventually sold to an advertising and consulting group. After, realizing the potential of 5G, Adam shifted his efforts towards investing in the "building blocks" of 5G - known as digital infrastructure, completing a number of strategic investments, buying cellular towers, data centers and fiber networks.

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