Thompson Street Capital Partners and Cequel III Acquire Controlling Interest in DDC Cabinet Technology
DDC Products are Key Components of Infrastructure Supporting Artificial Intelligence
ST. LOUIS, January 31, 2024--(BUSINESS WIRE)--Thompson Street Capital Partners (TSCP), a private equity firm based in St. Louis, announced today that the firm, along with Cequel III, has taken a controlling interest in privately held DDC Cabinet Technology (DDC). Co-founders Chris Orlando and Mark Ortenzi, who launched the DDC Cabinet business in 2011, will continue as minority investors. Financial details of the transaction were not disclosed.
DDC is a global leader in the design and manufacturing of innovative data center cabinet and cooling solutions. Among other uses, patented DDC solutions provide superior, cost-effective cooling options for the high-density GPU clusters that are required to run artificial intelligence (AI) and other compute-intensive applications. DDC products combine the efficiency of water cooling with the flexibility of traditional air cooling. This hybrid approach is optimized with a proprietary software offering, allowing companies to rack IT servers and related equipment as they have traditionally done, while scaling up to significantly higher power densities without the need for direct liquid cooling.
"The market for providing cooling infrastructure to high power density, AI-based computing environments is experiencing explosive growth, and DDC’s proprietary solution is well positioned to be a dominant technology provider within the category," said Tom St. Geme, Director at TSCP. "This is an exciting time to be part of DDC's continued plans for expansion."
"We’re thrilled to once again invest alongside Jerry Kent and the team at Cequel III to provide the growth capital that will enable DDC to scale into a leader within this highly attractive market," said Jim Cooper, Managing Partner at TSCP. "DDC is well positioned to continue taking advantage of opportunities for growth in what is clearly a significant moment for AI."
Following this transaction, Keith Markley will become Chief Executive Officer of DDC Cabinet Technology, effective February 5. Markley is a 30-year veteran of the telecommunications and data center sectors and previously served as Executive Vice President, Data Center Operations at TierPoint, a major DDC Cabinet Technology customer and leading provider of secure, connected IT infrastructure solutions to thousands of clients. Cequel III and Thompson Street are also investors in TierPoint. Reporting to Markley, DDC co-founders Orlando and Ortenzi will lead strategy and product innovation, respectively, as the company scales to meet the significant growth of high-density demands within the data center industry.
Hogan Lovells US LLP acted as legal advisor to Cequel III and Kirkland & Ellis LLP as legal advisor to Thompson Street. VLP Law Group LLP acted as legal advisor and DH Capital, a division of Citizens JMP Securities, LLC as financial advisor to DDC.
About Thompson Street Capital Partners (TSCP)
Thompson Street Capital Partners (tscp.com) is a middle-market private equity firm that helps transform already exceptional businesses into market leaders. Based in St. Louis, Missouri, TSCP invests globally in the life sciences and healthcare, software and technology, business and consumer services and products sectors. TSCP partners with management teams to increase value by accelerating growth, both organically and via complementary acquisitions.
About Cequel III
Cequel III (cequel3.com) is a private investment firm based in St. Louis, Missouri. The team has a well-established track record of over $40 billion in successful transactions, having helped build several, industry-leading companies through operational excellence and a focus on superior customer service. With a diverse and successful history as an investor operator, Cequel III today has established a strong reputation as a reliable, knowledgeable investment partner for the management teams of lower-mid-market, growth-oriented companies in a number of sectors, including real estate, healthcare, technology, and business services.
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