In an astronomical rise for datacenter mergers and acquisitions, deals reached a staggering $57 billion in 2024. The driving force behind this surge is no surprise: innovative strides in generative AI pervading the industry. According to Synergy Research Group, which tracks industry movements, 2024 shattered the previous record set in 2022 by an extra $5 billion.

Excluding mega-deals over $2 billion, the volume of M&A activity more than doubled compared to past records, primarily led by smaller, strategic agreements. Notably, the year saw datacenters positioned as key players in technological infrastructure, supported by a mix of acquisitions, equity deals, joint ventures, and strategic land purchases.

John Dinsdale, Synergy’s chief analyst, expressed that the appetite for datacenter expansion is unmatched. The needs driven by cloud services and digital consumption—spanning both consumer and enterprise sectors—remain insatiable. Generative AI is intensifying this demand, suggesting the trend will continue into the future.

Private equity firms are capitalizing on this momentum, significantly increasing their investment in datacenter capacity. While in 2021 they comprised just 65% of closed deals, recent years have seen them dominate 80-90% of transactions in the sector.

As 2024 closed with $29 billion worth of prospective deals in the pipeline, experts suggest another busy year lies ahead. This enthusiasm for datacenter investments aligns with predictions from tech analysts who foresaw the AI-led boom in distributed computing facilitating smaller, yet numerous, datacenters.