Equinix Acquires IO UK's Data Center Business

Transaction accelerates interconnection growth strategy for Equinix's London Slough campus

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Feb 06, 2017, 03:00 ET

REDWOOD CITY, Calif. and LONDON, Feb. 6, 2017 /PRNewswire/ -- Equinix, Inc. (Nasdaq: EQIX), the global interconnection and data center company, today announced that it has closed a transaction for the purchase of IO UK's data center operating business in Slough, United Kingdom. The facility, which will be renamed LD10, is in close proximity to Equinix's existing Slough data center campus and will help meet growing demand for digital infrastructure connectivity in the United Kingdom and Europe.

IO UK's facility is a development phase asset, which opened for business in 2015. For the period to December 31, 2015, which is the last fully reported financial period, IO UK generated revenues of approximately $1.4 million. The agreement was signed on January 7, 2017 and the acquisition was completed on February 3, 2017.

Highlights / Key Facts

The UK is a global leader in cross-border connectivity. According to a new report by TechUK, the UK accounts for 11.5 per cent of global cross-border data flows in 2015— compared with 3.9 per cent of global GDP and 0.9 per cent of global population. Cross-border data flows for the UK increased 28 times between 2005 and 2015 and are expected to grow another 5 times through 2021.[1] LD10 will be the latest UK data center asset on Equinix's global interconnection platform which will support this increase in data traffic and facilitate the movement of it worldwide.
The LD10 International Business Exchange™ (IBX®) data center will be tethered to the other data centers (LD4, LD5, LD6) on the Equinix Slough campus, enabling customers to easily interconnect with one another across business ecosystems for maximum collaboration across digital supply chains. The Slough campus also offers low-latency connectivity to key markets from London such as 30 milliseconds to New York and 4 milliseconds to Frankfurt.
LD10 will add approximately 350 cabinets of sold capacity and a total colocation space of approximately 3,340 cabs once the facility is completely built out. The data center currently has a customer mix that maps closely to Equinix's existing base including financial services, enterprise, and networks. IO UK's Slough data center contains Baselayer Modular Data Center units, which Equinix will maintain and expand, as needed.
Today, Equinix's U.K. data centers are business hubs for nearly 1,300 companies and the Equinix Slough campus sits at the center of Europe's largest financial trading community, with approximately 25% of European equities trades originating at this location. Businesses can also access a broad range of more than 200 network service providers, as well as leading cloud service providers such as Amazon Web Services, Microsoft Azure, IBM Softlayer and Google Cloud Platform which are available on the Equinix Cloud Exchange™.
With the current IT transformation underway, enterprises increasingly require low-latency network connectivity, access to cloud service providers in top global markets and interconnection with customers and partners across their digital supply chain to run their corporate IT. LD10 will enable Equinix customers to evolve from traditional businesses to "digital businesses" ― the need to globally interconnect with people, locations, cloud services and data. Additionally, customers will have the opportunity to operate on an expanded global platform to process, store and distribute larger volumes of latency-sensitive data and applications at the digital edge, closer to end-users and local markets.
With this transaction Equinix now operates 147 IBX data centers in 40 markets, providing customers even more ways to connect with other businesses around the world on Platform Equinix™.
RBC Capital Markets served as Equinix's financial advisor, and Slaughter and May acted as Equinix's external legal advisors in connection with this transaction.

Quotes

Eric Schwartz, president, EMEA, Equinix:

"London remains a global economic engine, with leading enterprises and cloud service providers making it a primary hub for IT infrastructure. Adding additional interconnection and capacity in this market enables local and international customers to leverage Platform Equinix to meet their changing business needs – whether that is to connect to networks, clouds, or financial markets – Equinix is the place to be."

Additional Resources

Equinix to Acquire Portfolio of 24 Data Center Sites from Verizon in $3.6 Billion Deal [press release]
Equinix Solidifies EMEA Data Center Portfolio [press release]
Equinix Invests $42M in London Data Center Expansion [press release]
The Successful Cloud-Enabled Enterprise [infopaper]

About Equinix
Equinix, Inc. (Nasdaq: EQIX) connects the world's leading businesses to their customers, employees and partners inside the most interconnected data centers. In 40 markets across five continents, Equinix is where companies come together to realize new opportunities and accelerate their business, IT and cloud strategies. www.equinix.com.

Forward Looking Statements
This press release contains forward-looking statements which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual results to differ materially from expectations discussed in such forward-looking statements, including statements related to the acquisition of IO's data center operating business in Slough, United Kingdom and the expected benefits from the acquisition. Factors that might cause such differences include, but are not limited to, unanticipated costs or difficulties relating to the integration of companies we have acquired or will acquire into Equinix, including the IO data center; the challenges of acquiring, operating and constructing IBX centers and developing, deploying and delivering Equinix services; a failure to receive significant revenue from customers in recently built out or acquired data centers; failure to complete any financing arrangements contemplated from time to time; competition from existing and new competitors; the ability to generate sufficient cash flow or otherwise obtain funds to repay new or outstanding indebtedness; the loss or decline in business from our key customers; and other risks described from time to time in Equinix's filings with the Securities and Exchange Commission. In particular, see Equinix's recent quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available upon request from Equinix. Equinix does not assume any obligation to update the forward-looking information contained in this press release.

Equinix and IBX are registered trademarks of Equinix, Inc.
International Business Exchange is a trademark of Equinix, Inc.

[1] "The UK Digital Sectors after Brexit" An independent report commissioned by techUK. Frontier Economics Ltd. https://www.techuk.org/insights/news/item/10086-the-uk-digital-sectors-after-brexit

SOURCE Equinix, Inc.