Scrapped Fairfax newspaper plant reborn as data centre

Fairfax's defunct printing plant at Tullamarine, Melbourne, is set to be reborn as a data centre via a backdoor float by a newly formed operation.

The data centre is set to go live in March 2015, with potential for a "significant data centre exceeding 7,200sqm of multi-tier white space at 20MW capacity".

Stage 1 of the data centre is expected to cost $35 million and create around 2,300sqm of space, with 2.3 MW capacity.

Tullamarine – a familiar landmark on the freeway between Melbourne's CBD and airport – was opened in 2003 to print metro daily The Age and other Fairfax papers. It cost $220 million to construct.

In June 2012, Fairfax revealed it would close the plant, along with its major Sydney production site in Chullora, and cut 1,900 jobs in a bid to save $250 million.

The Tullamarine data centre will be joined by a proposed 23,000sqm data centre facility in Brisbane, comprised of five data centre halls and an office building, estimated to cost $40 million.

The Tullamarine and Brisbane data centres are being proposed through a complex acquisition of a publicly listed shell company.

ASX-listed IM Medical, a firm that floated in 1996 and was historically involved in radiology, is being restructured via a backdoor float by ADX Management, "a specialist management company [and] manager of the Australian Data Exchange Trust".

Since December, IM Medical had been working on a deal with another tech firm, White Data, that up until today looked set to go ahead. However, IM Medical terminated that proposed contract because of a failure to meet the merger implementation timeline, paving the way for the new tie-up with ADX.

IM Medical director Richard Wadley told CRN that while the deal with ADX isn't exactly a reverse listing, the company will see wholesale change of the board and executive, as well as being renamed ADX Holdings.

Wadley, a career CFO, was hired around three years ago to help IM Medical "tidy up" its structure and restore the company; he said he was "very, very pleased" that the deal with ADX would deliver value for shareholders.

According to today's announcement to the sharemarket, "IMI Limited has terminated its previous agreement with White Data Limited and is pleased to announce that it has entered into a broader agreement to acquire 100 percent of ADX Management Limited in exchange for $6 million of shares in IMI."

White Data had been set to acquire the Brisbane data centre site, and it is unclear how ADX is now the would-be purchaser of this property. CRN was unable to contact ADX or White Data in time for publication.

White Data, which was only incorporated on 8 October 2012, specialises "in the management and operation of data centres". It had no revenue and posted a $1.1 million loss in the 12 months to 30 June 2013, its first full year of trading. 

ADX is a brand-new company, formed on 18 August 2014. Its proposed chairman is Ian Campbell, the chairman-elect of major IT integrator ASG Group and a cabinet minister under the Howard government.

The ultimate parent company is Trade Coast Properties, a Brisbane-based property and investment group.

The deal is forecast to complete in late October 2014, before which there are a number of hurdles to clear, including raising the required $6 million capital, executing the contract for Tullamarine property, completing the transfer of the Brisbane site to the new owners and gaining shareholder approval.