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 Channel Futures

Mergers and Acquisitions


Data center

Equinix Buys Verizon’s Data-Center Biz, Promises Partner Benefits

  • Written by James Anderson
  • December 6, 2016
Equinix's channel chief told us the company's partner now have a broader platform and greater footprint to offer their customers.

**Editor’s Note: Please click here for a recap of the biggest channel-impacting mergers in September-October 2016.**

Nearly two years after saying it was looking for a buyer, Verizon has agreed to sell its data-center business. Equinix is paying the carrier $3.6 billion in just the latest big acquisition with channel ramifications.

The purchase gives Equinix 29 data-center buildings in 15 metro areas and helps increase the company’s footprint in the U.S. and Latin America.

The purchase adds to Equinix’s boast of having highly “interconnected” data centers for their enterprise customers. Equinix President Karl Strohmeyer called it a win for his customers, who can now access new locations 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,” Strohmeyer said. “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.”

Equinix's Chris RajiahThe Verizon deal adds up to about 900 new customers and a 2.4 million square feet for Equinix. The new portfolio brings the company’s total to 175 data centers globally and 17 million gross square feet in five continents. It will also take about 250 Verizon employees that operate the facilities. Equinix CEO Steve Smith called it another step in the expansion of his company’s “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,” Smith said. “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.”{ad}

Christopher Rajiah, who leads worldwide channel sales and partner alliances for Equinix, said the 29 new data centers are a boon for the company’s partners.

“…they now have a broader platform and greater footprint to offer their customers. The deal also provides Equinix and its channel partners a larger combined footprint of cloud service providers and networks, which further enhances our ecosystem attractiveness to our combined end-customers,” he told Channel Partners.

The 15 metro areas include Atlanta, Denver, Houston, and Bogotá, Colombia. The deal is on track to wrap in mid-2017, pending the typical regulatory nods and closing conditions.

It was just five years ago that Verizon bought Terremark, the data-center provider, for $1.3 billion — so it’s turning a nice little profit. The company is just the latest big telco to shift away from running data centers; Windstream and CenturyLink, for instance, have in the past year announced they’re divesting of these assets and selling them to companies that specialize in operating facilities such as these.

Tags: Agents Business Models Cloud Data Centers Mergers and Acquisitions

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