Verizon Communications Inc. has given its nod to sell a large portion of its data centers to Equinix Inc. and the deal has become a major center for attraction for the whole data center industry and its players. The blockbuster deal is slated for as much as $3.6 billion in cash as the former company will now be shifting its focus onto mobile video advertising.
Interestingly, to make the deal possible Citigroup Inc. and Guggenheim Partners acted as advisers for Verizon with Jones Day rendering the legal counsel for the data center giant. On the other hand, for Equinix, Evercore Partners Inc., JPMorgan Chase & Co. and law firm Davis Polk & Wardwell LLP acted as prime advisers.
The deal will include an astonishing number of 24 facilities owned by Verizon built in around 15 major metro markets. Post the transfer of data centers, Equinix now has 175 data centers in more than 43 markets worldwide.
The company website of Equinix displayed the banner stating – ‘Equinix to Acquire Verizon Data Centers – Equinix to expand global platform with 24 new data center sites across 15 metro markets in North and Latin America to support the digital economy’s growing need for interconnection.
Furthermore, the company listed down major highlights/key facts relating to the deal in a press release on Dec 6, 2016
Quotes by Equinix Top Management:
Steve Smith, President and CEO, Equinix commented:
“This unique opportunity complements and extends Equinix’s strategy to expand our global platform. It enables us to enhance cloud and network density to continue to attract enterprises, while expanding our presence in the Americas. The new assets will bring hundreds of new customers to Platform Equinix while establishing a presence in new markets and expanding our footprint in existing key metros. The deal will also provide significant value for shareholders as the proposed transaction is expected to be immediately accretive to our adjusted funds from operations per share upon close.”
Karl Strohmeyer, President, Americas, Equinix stated:
“This deal is a significant win for our existing customers, who will gain access to new locations, ecosystems and partners. It is also a win for the new companies joining Equinix, as they will be able to leverage Equinix’s global footprint and unique interconnection services. At Equinix, companies can architect a globally consistent platform within local metros, keeping their critical data and processing capabilities as close as possible to the digital edge and end-users.”
The list of all locations of data centers involved in the deal is given below:
- Miami (Miami and Doral)
- New York (Carteret, Elmsford, and Piscataway)
- Bogotá, Boston (Billerica)
- Chicago (Westmont)
- São Paulo
- Seattle (Kent)
- Silicon Valley (Santa Clara and San Jose)
- Washington, D.C. (Ashburn, Manassas, and Herndon)
- Atlanta (Atlanta and Norcross)
- Dallas (Irving, Richardson-Alma, and Richardson-Pkwy)
- Denver (Englewood)
- Los Angeles (Torrance)
The mega deal which has taken data center industry by a big surprise will include as much as 24 facilities in almost 15 metro markets. Notably, Verizon will still continue offering data center services with help of Equinix as its partner. After the announcement of deal Verizon shares climbed by 1.8% while shares of Equinix registered an increase of 3.2%. Looks like a win-win situation for both the companies.