Equinix Wraps Up $3.6B Data Center Deal
- May 03, 2017
Equinix Inc. has expanded its presence by 3 million square feet with the closing of the acquisition of 29 data centers and accompanying operations from Verizon Communications Inc. Five months after announcing the transaction, the global interconnection and data center company paid $3.6 billion in cash for the portfolio, which notably broadens its footprint in the United States and Latin America.
It’s a good time for growth in the data center arena. “As the technological shift to digital is transforming large sections of society and the global economy, companies are re-architecting their IT infrastructure to thrive in this new environment. They are moving from traditional centralized infrastructure to a distributed model that keeps data closer to the customers, partners and employees using it. With this significant expansion of Equinix’s globally consistent footprint, our platform is even more valuable to companies that are leveraging this new model of interconnection at the digital edge,” Equinix CEO Steve Smith said in a prepared statement.
The data centers are located in 15 markets, including Atlanta; Boston; Chicago; Culpeper, Va.; Dallas; Denver; Houston; Los Angeles; Miami, home of the 750,000-square-foot Miami NAP (Network Access Point) of the Americas, now renamed MI1; New York; Northern Virginia/Washington, D.C.; Seattle; and Silicon Valley in the U.S.
In Latin America, Equinix picked up properties in Bogotá, Colombia, and São Paulo, Brazil. Bogotá, Houston and Culpeper, Va.—site of the 250,000-square-foot NAP of the Capital Region, which Equinix describes as one of the most secure and technologically sophisticated data center campuses in the eastern U.S.—are new territories for the company.
With the completion of the Verizon portfolio purchase, Equinix now owns more than 175 International Business Exchange data centers totaling roughly 17 million square feet across 44 markets in the Americas, EMEA and Asia-Pacific.
Equinix’s big-ticket data center deal with Verizon appears to be a harbinger of things to come. “Bold M&A will disrupt the playing field—while raising barriers to entry for newcomers to join the game,” according to a report on the North American market by commercial real estate services firm JLL. “Mergers and acquisitions in the data center sector surged in 2016, a trend that is on pace to continue through the new year. As the experienced players become bigger, expect less room on the bench for new recruits.”
Image courtesy of Equinix