Switch & Data Shareholders OK Equinix Deal

Shareholders of Switch & Data have voted to approve the company’s proposed acquisition by Equinix, the companies said Friday. Completion of the $700 million deal is delayed by pending approvals from federal antitrust regulators, and not likely to close until the second quarter. Switch and Data will announce the expected closing date in a press release five business days before the expected closing date.

Switch and Data (SDXC) recently moved to settle three lawsuits related to the sale to Equinix. A memorandum of understanding between Switch and Data and lawyers for plaintiffs would have all claims dismissed with prejudice in return for attorneys fees and costs, estimated at about $900,000.  

“Switch and Data and the other defendants deny all of the allegations in the lawsuits and believe that the existing disclosures regarding the proposed merger are appropriate under the law,” the company said in an SEC filing. “Nevertheless, Switch and Data and the other defendants have agreed to settle the putative class action lawsuits in order to eliminate the risk, burden and expense of further litigation, to fully resolve all claims raised in the lawsuits, to permit the merger to be consummated without the risk of injunctive relief or delay, and to permit Switch and Data’s stockholders to receive the consideration provided for in the merger.”

Switch and Data Had Another Suitor

The biggest deal in the data center industry for 2009 was the news that Equinix (EQIX) would acquire Switch and Data in a $689 million transaction. As the year draws to a close, we’re learning more about the behind-the-scenes maneuvering that led to the deal, in which Switch and Data (SDXC) spent months weighing competing bids from Equinix and an international provider.

The negotiations with the rival suitors, which began in earnest in April and concluded in late September, are detailed in an SEC filing by Equinix. The existence of a rival suitor for Switch and Data was first noted by Paolo Gorgo in an analysis at Seeking Alpha last week.

In January Switch and Data was approached by “a privately-held firm in its industry based outside of the United States” to discuss a possible business combination. This international company proposed a merger of equals with Switch and Data, which emphasized that it was not for sale but began discussions in March.

Equinix contacted Switch and Data in April to express interest, kicking off five months of talks. Equinix dropped out of the talks in mid May, but resumed discussions in early July. On Sept. 26, the Switch and Data board determined that the Equinix bid – which represented a 32 percent premium to its stock price – was the best outcome for its shareholders.

Who was the mystery suitor? Paolo notes that the description fits Interxion, which already had a joint marketing agreement with Switch and Data. At the time, we noted that the partnership “appears to be a competitive response to the growth of Equinix, which acquired IXEurope last fall, providing it with facilities in major Internet markets on both sides of the Atlantic.”

London Roundup: Apollo, Telehouse, Infinity ONE

Here’s a roundup of data center headlines from London:

• Apollo Opens PoP in Equinix London. Transatlantic submarine cable system company Apollo announced Thursday that it has opened a new Point of Presence (PoP) in Equinix’s (EQIX) LD4 London Slough data centre.  This new PoP provides resilient, intercontinental access between the UK and major cities in the USA.  Apollo chose the Equinix LD4 facility to meet increasing customer demand for reliable, linear wavelengths between London and the USA.  “Directly connecting to LD4 will offer our customers diversity from other London networks and meet the growing requirements of our customer base,” said Richard Elliott, managing director of Apollo.  “By investing in this new PoP, we have enhanced our network in a way that cuts latency, increases diversity and ensures optimum resilience.”  Apollo is a UK based company jointly owned by Cable & Wireless and Alcatel-Lucent.
• Telehouse West preview. Key members of the press and analyst groups were given a tour of the Telehouse West facility in London.  In April 2009 Data Center Knowledge reported that the Greater London Authority had approved a plan in which waste heat from the $180 million facility would be used in a district heat network for the local Docklands community. The facility is expected to open in the first quarter of 2010 and the waste heat will keep 1,600 homes nice and warm.  Silicon.com has a few photographs of the facility and construction progress of the 9 story building.
• Infinity wins Datacentre Leaders award. London-based data centre company Infinity received the ‘Future Thinking and Design Concepts’ award at the Datacentre Leaders Award Tuesday.  A sustainable biomass plant at the Infinity ONE facility enables “dark green energy to be generated from bio-matter supplied by a local group of cooperating farms.”  Infinity is committed to reducing both the energy waste and the carbon footprint of the IT sector and has adopted recommendations within the EU Code of Conduct on Data Centre Energy Efficiency.

Roundup: Equinix, Telehouse, Polaris

Here’s a roundup of data center headlines from around the world – Singapore, South Africa and Australia:

• ACTIV expands to Equinix Singapore.  Equinix (EQIX) announced last week that ACTIV Financial, a provider of market data content and technologies, will expand operations to Equinix’s Singapore International Business Exchange (IBX) data center as a part of its global expansion.  Being in close proximity to the major trading venues and exchanges in Asia allows ACTIV to provide customers with low latency access to its high-volume market data services.  ACTIV currently leverages Equinix facilities in Chicago, New York, Frankfurt and London.  “ACTIV delivers more than one million updates per second including hard to process content such as equity options depth feeds, order book data, and the latest feeds from exchanges around the world,” said Timothy Neo, Managing Director, Asia Pacific, ACTIV Financial.
• Photo tour of the Polaris Data Centre. Australian iTnews has a photo gallery of the Polaris Data Centre, built in the newly-developed town of Springsfield, Queensland.  The five story, $241 million data centre is among five data centres shortlisted by the Australian Federal Government.  The facility opened in January 2009 and houses equipment from companies such as NEC, HP, Suncorp and others.  Polaris was designed for 20 megawatts at full capacity, holds 1.5 million litres of water in onsite water tans, and is served by a dual ring of diverse dark fibre.  The iTnews article contains photos inside the Queensland data centre.
• PIPE International selects Equinix Sydney.  Equinix (EQIX) announced that PIPE International has selected it as a key interconnect provider for its new PIPE Pacific Cable (PPC-1) undersea cable.  PIPE is also currently located in Equinx data centers in Tokyo and San Jose.  The newly laid PPC-1 undersea cable runs 6,900 km from Guam to the Equinix Sydney campus and has a capacity of 2.56 terabits per second.  “The new PPC-1 cable system will also enable our customers to increase the resilience of their international network and provide additional redundancy,” said Samuel Lee, President, Equinix Asia Pacific.
• TeleHouse launches data center in South Africa. TELEHOUSE Europe, a subsidiary of KDDI announced that they will open the data center TELEHOUSE CAPE TOWN in Cape Town, Republic of South Africa.  KDDI is a large Japanese telecommunications provider that has been growing its business in developing countries; including a recent partnership with Bangladeshi bracNet.  TELEHOUSE Europe is a part of KDDI Group’s European local subsidiary and will be the first data center opened by a Japanese telecommunications carrier in Africa.  The new data center is based on a partnership between TELEHOUSE Europe and Teraco Data Environments, the first carrier-neutral data center in South Africa.

European Data Center Revenue May Double

Several stories from recent weeks highlight the vibrant data center industry in Europe. Here’s a roundup:

European data centre revenue set to double
A report published by Tariff Consultancy Ltd notes that European data centre revenue is “set to more than double over the five year period from 2010 to 2015, with net raised floor space to increase by 70%, driven primarily by price increases.” The report gives pricing and forecasts for 19 of the EU25 countries and analyzes pricing of a standard 19″ rack, a small cage space and a 50 KVA suite of space for each of the countries.  It also dives into trends impacting data centres such as raised floor capacity in markets, revenue per square meter forecasts, electricity pricing, pricing per rack and cage, and the most expensive data centre countries.

Savvis received EuroFIT award
Financial technology publication Waters published their innagural EuroFIT awards earlier in the month, to recognize Europe’s hottest financial IT products and services.  In the category of Best Datacenter Hosting Provider, Savvis (SVVS) took the award as a company capitalizing on the rising demand for data center services.  Equinix was listed as an honorable mention in the category. A little over a year ago Savvis marked the completion of a global data center expansion by opening a 37,500 square foot facility on the outskirts of London in Slough. The award also noted that Savvis services seven of the top ten Fortune 500 financial services and banking firms. Amazon (AMZN) won the Best Cloud Provider award as an “overwhelming leader in the field.”

The Bunker selected by Cimar
The Bunker announced that it was selected by Cimar (UK) Limited to provide managed ultra secure hosting of its radiology image sharing web service. The Bunker delivered a scalable platform to Cimar built on Microsoft technology.  Howard Jenkinson, managing director of Cimar said “absolute information security is a pre-requisite for any digital service carrying sensitive patient information.”  Click here for a video of ‘The Bunker’ and details of a July 2009 130,000 square foot expansion.

Roundup: Ciena, Equinix, Rackspace

Here’s a roundup of news announcements from the data center and hosting industry:

• Ciena acquires Nortel Ethernet assets. Ciena Corporation announced that they were selected as the successful bidder in the auction for all of the optical networking and carrier Ethernet assets of Nortel’s Metro Ethernet Networks business.  Ciena has agreed to pay $769 million for the assets.  Ciena CEO Gary Smith said the purchase is “bringing together complementary technologies in switching and transport to create an innovative powerhouse with the scale to challenge the industry status quo and offer customers a practical path for transitioning to automated, optical Ethernet-based networking.”  In 2008 Nortel saw $1.36 billion in revenue from the assets to be acquired.
• Equinix adds to European Ethernet Exchange.  Earlier in the month Equinix announced that submarine transport cable provider Hibernia Atlantic was expanding with Equinix in New York. Now European-based carriers Exponential-e and Tinet have signed up to participate in the recently announced Carrier Ethernet Exchange platform.  The initial deployment locations include London, New York, Chicago and Silicon Valley.  The goal of the project is to provide Ethernet Network to Network Interconnections (E-NNI).  VP of Engineering at Exponential-e Mukesh Bavisi said “Equinix already plays a strategic role in our peering relationships with other Tier 1 service providers, so it is a natural choice that we leverage its carrier-rich interconnection hubs to develop an Ethernet interconnection infrastructure.”  According to Infonetics Research demand for carrier Ethernet services is set to double within five years.
• Rackspace offers complete Verisign SSL line.  Rackspace announced that they expanded an agreement with Verisign allowing them to directly sell, install and renew Verisign SLL Certificates to their customers.  Additionally the entire line of certificates is now available as a self-service option via the MyRackspacecom customer portal.  “Trust is the most valuable currency on the Internet today, and trust is what VeriSign SSL and EV SSL protection delivers for Web site operators the world over,” said Michael Lin, vice president and general manager of SSL at VeriSign.

Equinix, Switch & Data Prep Integration

Teams arrived at Switch and Data Tuesday to begin integration plans for the company’s planned $689 million acquisition by Equinix. Switch and Data plans to file its proxy statement with the SEC by the end of November to give out more information surrounding the transaction for an overall vote expected to take place in the first quarter of next year. In the meantime, both companies are keeping busy, issuing a series of news announcements this week.

On Monday, enterprise video solution provider Kontiki announced that Equinix had selected their Enterprise Content Delivery Networking (ECDN) solution to deliver video content to every employee’s desktop worldwide.  Kontiki was deployed in a matter of weeks and will deliver high-quality video for training and employee communications. 

Equinix Adopts Kontiki
“As video becomes more ubiquitous throughout our company, we knew that we’d need a complete video infrastructure in place that could grow with our needs,” said Equinix CIO Brian Lillie. “We adopted Kontiki’s video solution portfolio based on ROI, scalability and ease of use.” 

Roundup: Amazon, Hurricane Electric, Level 3

Here’s a roundup of news announcements from the data center and hosting industry:

• Amazon Web Services Asia Expansion.  Amazon Web Service announced Thursday that an expansion of their services into an Asia-Pacific region will take place in the first half of 2010, when developers and businesses will be able to access infrastructure services from multiple availability zones in Singapore, with other zones in Asia following in the second half of 2010.  AWS services included at launch will be Elastic Compute Cloud (EC2), Amazon Simple Storage (S3), SimpleDB, Relational Database Service (RDS), Simple Queue Service (SQS), MapReduce and CloudFront.  Pricing for web services in Asia will be announced when launched in 2010.
• Hurricane Electric Expands Infrastructure at Equinix.  Internet backbone and IPv6 provider Hurricane Electric will extend its presence to additional Equinix data centers outside of the United States. Hurricane Electric will expand into Equinix Tokyo-2, Hong Kong-1 and Zurich-1 facilities.  Citing an increasing demand for IPv6 content in Asia and Europe as a reason for global expansion, the Hurricane Electric presence in global Equinix data centers will also allow other Equinix customers to easily exchange IP traffic with more than 500 associated IPv6 backbones.  Equinix chief marketing officer Jarrett Appleby said “operating also within our TY2, HK1 and ZH1 centers will put Hurricane Electric in the middle of an existing community of international and local networks and carriers for its next generation IP access service.”
• Level 3 expands in Atlanta. Level 3 announced Thursday an expansion of operations and enhancing local presence in the Atlanta area.  The initiative will provide mid-market enterprises with greater access to Level 3’s services via its extensive backbone network, metro fiber-optic footprint, and a locally focused sales and customer support team.  Level 3 will expand the network in the Atlanta area that already passes nearly 15,000 businesses today.  Following their “link globally and connect locally” mantra, the move will allow Level 3 to provide a competitive alternative for Atlanta area businesses.  Level 3 has announced similar focused expansions in Chicago, Miami and New York in recent months.

Roundup: Equinix, Switch & Data, The Planet

Here’s a roundup of news announcements from the data center and hosting industry:

• Hibernia Atlantic expands to two Equinix data centers. Submarine transport cable provider Hibernia Atlantic announced Tuesday the expansion of its Global Financial Network(GFN) into the Equinix New York-2 and New York-4 data centers in Secaucus, New Jersey.  The expansion from Hibernia aims to provide low latency, redundancy and connectivity to global banks and exchanges in the New York metro area.  Hibernia’s GFN spans 24,000 Kilometers (14,913 miles) of fiber optic cables across key financial cities around the world.  “Our continued GFN expansion in New York metro and in other major financial centers reflects our core commitment to provide ‘security through diversity’—our company philosophy that offers world-class, redundant solutions to our financial customers,” said Bob McMann, VP of Provisioning and Procurement for Hibernia
• Switch & Data selected by Pragma Securities. Switch & Data announced that Pragma Securities, a trading solutions provider has selected their New York Financial EcoCenter to optimize the performance of its quantitative trading solution.  After an extensive diligence process Pragma selected the North Bergen, New Jersey data center to host its trading execution services, and will be one cross connect away from the other electronic trading customers in the site.
• Nimsoft introduces alliance program. Following the October launch of their Unified Monitoring Solutions, Nimsoft announced their charter members in the Unified Monitoring Alliance Tuesday.  The new monitoring solution provides a total, unified view of both internal and external IT resources.  The Unified Monitoring Alliance partners are made up of service providers, solution partners and technology development partners.  Partners like FusionStorm, Ingram Micro, Shavlik, Service-now.com, Rackspace and many others are among the first to join the alliance.  “The alliance not only expands opportunities for growth and collaborative innovation for our partners, but also effectively increases the breadth and depth of the systems monitoring and management solutions that Nimsoft offers to its customers,” said Nimsoft President Gary Read said
• The Planet signs Ayuda Networks. The Planet announced Tuesday that Ayuda Networks has signed on to join the company’s recently launched Partner Plus program.  Ayuda Networks consults with clients to evaluate connectivity requirements and implement the best solutions for their specific business.  Ayuda will add The Planet to its portfolio of top-tier solution providers and include them in recommendations to clients evaluating managed and dedicated hosting, as well as colocation services.