Equinix, Inc. (Nasdaq: EQIX), the global interconnection and data centre company, have announced that it has acquired the Zenium data centre business in Istanbul from the existing shareholders in an all-cash transaction for USD $93 million. The data centre currently generates approximately USD $2.5 million of annualised revenues. The acquisition was signed and completed on October 6, 2017.
The Zenium data centre, which will be renamed Equinix IS2, will further strengthen the Equinix position in Europe. As the largest metro in Turkey, Istanbul acts as a strategic gateway between Europe and Asia with critical economic and geopolitical importance. IS2 provides Equinix with key capacity and a growth path which enables the company to address growing demand for colocation and interconnection services in Turkey.
- According to the International Monetary Fund, Turkey has the world’s 17th-largest nominal GDP1 and a population of approximately 80 million people. The acquisition of IS2 extends Equinix’s ability to provide Turkish businesses with the direct and secure connectivity they need to expand their global reach in new and existing markets. Equinix currently operates a single facility- IS1, in Istanbul and has 67 International Business Exchange™ (IBX®) data centres across Europe and the Middle East, strategically located in 18 metropolitan areas across 13 countries.
- The purchase of the Zenium business includes a total of three buildings and land. The IS2 data centre building is partially fitted out; the two other buildings are shell and core and prepared for data centre fit out. IS2 provides Equinix with 1,500 square metres of colocation space today with the ability to increase this to 12,000 square metres and up to 22MW of critical customer load at full build- creating the ability for a future campus environment.
- There are 10 networks, including Turk Telecom, already present at the new IS2 data centre, providing network choice to the many multinationals, hyper-scalers and IT vendors who use Istanbul as a regional headquarters or a gateway to markets in Asia and the Middle East. This connectivity is the foundation for cloud adoption, as enterprises continue to increase IT consumption of cloud-related services to accelerate business performance.
- According to the Global Interconnection Index, which measures and forecasts the growth of Interconnection Bandwidth, Europe is expected to grow 44 percent per annum to reach 1451 Tbps of installed capacity by 2020. Europe’s growth will be driven by a number of factors, including data sovereignty and the need for European businesses to exchange information with other businesses in-region.
- Istanbul is a key traffic route for submarine cables between Europe, Asia and Africa. These cable systems enable accelerated traffic globalisation and data consumption, as well as rapid growth of cloud and online services. They are increasingly important for industries that rely on low-latency connectivity, such as the online gaming and CDNs — many of which already use Istanbul as a regional hub today.
- Equinix currently operates more than 180 IBX data centres in 44 markets, providing customers with even more ways to connect with other businesses around the world on Platform Equinix™.
- Slaughter and May acted as lead external legal adviser for Equinix. RBC Capital Markets served as Zenium’s financial adviser.
Eric Schwartz, president, EMEA, Equinix:
“The dynamic evolution of digital technology is disrupting how business is done across all industries, forcing companies to invent new, information-centric business models. These business models rely on interconnection and distributed IT architecture. As the Turkish economy continues to grow, Istanbul will become an increasingly important hub for connectivity and technology infrastructure, and this new campus will help Equinix meet this demand from customers across our global customer base.”
Franek Sodzawiczny, CEO & founder, Zenium:
“We congratulate Equinix with this transaction, which enables us to focus on our business in Western Europe. The technological infrastructure in Turkey is advancing quickly, as businesses are requiring more interconnection to compete. This is a great opportunity and Equinix is now well positioned to drive this exciting data centre business forward.”