Equinix blog
Loading...
Where Opportunity Connects
Where Opportunity Connects
Where Opportunity Connects
On May 1st, Equinix announced the completion of its acquisition of Verizon’s U.S. and Latin American data center portfolio, which is a unique opportunity to expand our Americas presence with network- and enterprise-rich assets. The acquisition includes 29 data centers across 15 metros in a transaction valued at U.S. $3.6 billion.
This acquisition of the 29 data centers substantially enhances our interconnection platform, accelerates our efforts with the government and energy sectors and supports our enterprise offering. It also provides a unique opportunity for Equinix to expand its presence in the Americas. The new assets bring a significant number of new enterprise customers to Platform Equinix while establishing presence in new (Culpeper, Houston and Bogotá) and existing key markets, including Atlanta, Denver, Miami, New York, São Paulo, Seattle and Silicon Valley.
Several key facilities include:
Miami NAP of the Americas (“NOTA”) (MI1) is a key interconnection point and destination for customer deployments, and it further positions Equinix for Latin American growth.
The Bogotá (BG1) and São Paulo (SP4) sites extend our presence in the growing Latin American market. The São Paulo (SP4) site is a primary network, financial and cloud hub in Latin America with two (2) Internet Exchanges (IX).
The four facilities in Culpeper, Virginia, (CU1, CU2, CU3, CU4) accelerate our relationships in the Government sector and provide a strong foundation for advancing our government initiatives.
The Houston site (HO1) expands our presence to a key new metro market in the U.S. and helps accelerate our progress with the energy sector. Houston is the fourth-largest city in the U.S. (by population), and has the fourth-highest count of Fortune 500 companies.
Equinix will acquire 29 facilities in the following metros and locations:
This transaction enhances customers’ options and choice across these 15 markets: Atlanta, Bogotá, Boston, Chicago, Culpeper, Dallas, Denver, Houston, Los Angeles, Miami, New York, São Paulo, Seattle, Silicon Valley and Washington, DC. The three metros that are new to our portfolio are Bogotá, Culpeper and Houston.
Yes. The facility in Richardson, TX (Parkway) could not easily be separated from portions Verizon was retaining (office and lab space), and has been excluded from the transaction.
In Santa Clara, we had previously listed three sites instead of four due to shared infrastructure elements between two of the buildings, but through integration planning we decided to split it into two sites so as to simplify operations.
The acquisition price of the 29 Americas assets from Verizon is $3.6 billion.
This acquisition complements and extends our strategy to expand our global platform and enhance cloud and network density to attract enterprises. It also provides a unique opportunity for Equinix to expand its presence in the Americas.
The purchase of the 29 assets brings approximately 1,000 customers including over 600 net new to Platform Equinix, 29 data centers, three new metros, approximately 3 million gross square feet, and expands our cross-sell opportunities with additional metros. With the acquisition of Verizon, we add 21 owned assets to the portfolio, including the key assets in Miami and the four facilities in Culpeper.
Prior to the acquisition of these assets, Equinix owned 34 of its 150 IBX sites, which generated 36% of our revenues in 2016. The acquired data center portfolio nicely complements our ongoing strategy to continue to own more of our assets. The Verizon assets were 85% owned, and with this combination we will now own 45% of our combined Equinix Americas portfolio, or 40% of the overall global platform. With the acquisition of the Verizon assets, we add 21 owned assets to the portfolio, and this includes the key assets in Miami (MI1 and MI6) and the four data centers in Culpeper (CU1, CU2, CU3 and CU4.). Post-close, we’ll own 55 of 179 data centers.
The Verizon assets represent our sixth major acquisition over the past decade (IXEurope, Switch & Data, Alog, Bit-Isle, Telecity, Verizon). Through the integration of these prior acquisitions and with our recent investments in Equinix Customer One (ECO), we have developed a strong platform to integrate acquisitions and have a team of experienced integration experts with a well-developed playbook. The majority of the resources required to complete the Verizon integration will be located in the Americas region.
The Verizon assets include approximately 1,000 customers with over 600 net new to the Equinix platform. Many of these customers are Fortune 1000 companies and/or federal and local government entities. Verizon will remain a substantial customer and key partner following the close of this transaction.
Given both Equinix and Verizon’s experience in the industry and reach to large Enterprise and service providers, there are a number of common customers. Both companies believe that our customers will view the transaction favorably and will be pleased that a company such as Equinix will be carrying on Verizon’s excellent operational track record.
This acquisition provides a larger combined footprint of cloud service providers and networks, which further enhances the attractiveness of the Equinix ecosystem to customers. Both the Culpeper facilities (CU1, CU2, CU3, CU4) and Miami NOTA (MI1) have significant traction with government customers and add key geographic diversity for Enterprise and Cloud providers. Additionally, this deal provides an AWS Direct Connect node in São Paulo (SP4), and Google Cloud Platform nodes in both São Paulo and Bogotá (BG1).
New metros: Three (3)
This acquisition expands our presence and furthers our strategy in Latin America with additional facilities in Miami (MI1, MI2) and São Paulo (SP4), and entry into a new market with a data center in Bogotá, Colombia (BG1). These new sites will enable customers to take advantage of interconnected business ecosystems and the proven expertise of Platform Equinix. The Miami NOTA (MI1) is a key interconnection point and gateway to Latin America, and it increases our network density with 90 global networks interconnecting to ~150 countries, including key subsea routes to Latin America.
In Brazil, the new São Paulo site (SP4)—our sixth site in Brazil—is a primary networking and Cloud hub in Latin America with two Internet Exchanges (IX). It directly connects to existing sites in Brazil (SP1, SP2 and SP3) via Equinix Metro Connect after close, expanding our ecosystems substantially and helping us drive more interconnection into the market.
When it comes to investment, we continue to be thoughtful about creating shareholder value and extending our global leadership position in every market. We continually remain proactive and highly selective on potential M&A and look for opportunities to:
Equinix continues to believe in Latin America as an emerging growth market where we can capture new demand driven by the rapid growth of a digital economy. We see many key macro indicators that are driving our conviction, including:
Equinix intends to make the required investments in these facilities to unlock more value by distributing our platform of globally interconnected ecosystems across the newly acquired assets. Additionally, we are adding these assets to a portfolio that contains more than 1,400 carriers globally, giving customers significantly more choice and our network providers more assets to deploy in. Our sole focus as a company is expanding the reach of our global data center platform and delivering exceptional customer value through interconnection and our digital ecosystems. This focus gives us confidence that we will be able to give the business the attention it needs to succeed.
Verizon will continue to be a customer in many of the facilities, and Equinix will operate the portfolio in a carrier-neutral manner. The Terremark sites in the portfolio were carrier-neutral prior to Verizon’s acquisition and already feature multiple networks. We have a significant track record in transitioning carrier-owned sites onto our carrier-neutral platform and adding significant network density to these sites, and the tethering of our sites at the metro level to create “virtual campuses” enhances this strategy.
With the joint announcement on March 30th, we finalized a substantial new channel relationship with Verizon picking Equinix to be their exclusive global colocation partner. In addition, we’ve seen interest from our channel partners about our expanded presence in new markets such as Houston and Culpeper, and particular interest from the channel in our new capabilities in the government sector.
Only the colocation products related to space, power and interconnection inside of each facility have been transitioned to Equinix. Verizon will continue to offer all of its other services and solutions being sold at these sites via Verizon sales.
Equinix is obligated to honor all terms and conditions in the existing contracts relative to the colocation business for the duration of the existing contract. However, to simplify your relationship with Equinix, Equinix would be happy to use your existing Equinix terms (if you are a current customer of Equinix) or sign new Equinix paperwork which would make future ordering of new services or global services much quicker.
Our customers are our number-one priority. Both Verizon and Equinix have detailed transition plans in place and will work closely with customers during this time period.
This acquisition does not affect Verizon’s managed hosting and cloud customers, or its data center customers in Europe, Asia-Pacific and Canada. Verizon will continue to deliver cloud and hosting services out of these centers by contracting with Equinix for the data center space required.
Yes, Equinix has the Equinix Partner Program. You can find more information about the Equinix Partner Program at Equinix.com/partners.
Equinix has set up a unique email address for general questions from our new Verizon customers. Please send any questions or requests to welcome@equinix.com and we will respond within 24 hours.
