Houlihan Lokey Advises Quantum Loophole

Houlihan Lokey is pleased to announce that Quantum Loophole Inc. (QL) has entered into a strategic joint venture with TPG Real Estate (TREP) to acquire and develop an innovative, first-of-its-kind, multiple-gigawatt scale master-planned data center community in Frederick County, Maryland. In connection with the venture, TREP also has acquired a minority stake in Quantum Loophole. The transaction closed on June 23, 2021.

Quantum Loophole is a disruptor of industry standard data center development. The company’s master-planned data center city development vision uniquely addresses the scalability, connectivity, and cost-efficiency challenges of today’s larger-scale deployments. Since launching in January 2020, during a time when unforeseen COVID-19 hurdles drove demand in digital infrastructure investments, QL has raised over $13 million in private investor funding in addition to $100+ million raised for the joint venture and a minority equity investment from TREP associated with this transaction.

QL is reimagining the way data centers can be developed by deploying innovative and sustainable energy, fiber, and access control systems in ethically planned and community-centric designed data center cities. These cities are designed to offer gigawatt levels of critical power, leverage cutting-edge technology to deliver connectivity seamlessly, and offer mass-scale fiber to nearby networking hubs. QL is founded and led by Josh Snowhorn, an interconnection and data center industry executive who has built over $10 billion of value during his 20+ years of industry experience. Mr. Snowhorn is supported by a proven leadership team with past experience at Fortune 500 and other industry-leading Hyperscaler companies.

The investment from TREP has been used, in part, to fund Quantum Loophole’s recently closed purchase of a 2,100-acre property as well as land development costs of the site formerly owned by Alcoa Eastalco. Partnering with TREP strengthens QL’s vision and path to build out the first ever mass-scale gigawatt data center community.

Houlihan Lokey’s Technology, Media & Telecom Group served as the exclusive financial advisor to QL and assisted in advising the company on (i) the development of its initial business plan and go-to-market strategy, (ii) structuring, arranging, and negotiating multiple rounds of seed financing, and ultimately (iii) structuring, arranging, and negotiating the joint venture to acquire the initial parcel serving the Northern Virginia data center market and fiber build.

This transaction reinforces Houlihan Lokey’s depth of expertise in the data center industry and ability to maintain long-standing relationships with companies across the telecom ecosystem.

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