Data centre operator Digital Realty has decided to acquire eight of Equinix's European facilities for $874 million.
The eight facilities are located throughout Europe with five of the facilities located in London, two in Amsterdam and the last in Frankfurt. In total all of the facilities that Digital Realty has agreed to buy from Equinix can produce 24.4 megawatts of IT capacity.
Currently 650 network, cloud and IT providers depend on these facilities to deliver the digital services that their companies sell. The sites are already at around 72 per cent capacity according to Digital Realty.
This sell-off may cause some operators to consider making acquisitions of their own in order to increase their storage and computing capabilities. The managing director of the data centre market-focused analyst firm Broadgroup, Steve Wallage said: “The speculation about the divestiture of these assets has put a lot of focus on that area for operators, but there is still a bit of caution because some of the data centre valuations are still quite high. The could do a rollup strategy, where they try to acquire an operator in each market and put them altogether (under a single brand), as a big concern for buyers is – if they don't move soon – there might be nothing left worth spending their money on.”
In November 2015, the European Commission (EC) anti-trust chiefs ordered the Equinix data centre sell-off as they were concerned that the competitiveness of Europe's data centre market could be affected by the operator's £2.35bn acquisition of TelecityGroup. The only way the company could get its merger approved was by committing to let go of a number of its data centres first.
The EC has yet to approve Digital Realty's acquisition of Equinix's eight European facilities but the firm believes that it will do so sometime in late 2016.
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