Equinix, Inc. (EQIX) will buy European colocation specialist IXEurope Plc (IXE) for $482 million, the two companies said this morning. Equinix had been discussed as a potential acquirer since IXEurope announced last month that it had received buyout offers. The deal provides Equinix with a European presence to go with its network of facilities in the U.S. and Asia.
IXEurope's business includes 14 data centers with 380,000 square feet of space throughout Europe, including centers in London, Zurich, Frankfurt, Munich, Paris, Dusseldorf and Geneva. The company's 450 enterprise and Internet customers include Merrill Lynch, Avis Europe, Deutsche Boerse, Citigroup, Rackspace and SurfControl. The deal gives Equinix a total footprint of more than three million square feet of data center space.
"The strategic acquisition of IXEurope by Equinix will solidify Equinix's position as the world's market leading colocation provider with high-quality data centers across the United States, Asia-Pacific and Europe," said Steve Smith, CEO of Equinix. "Customers are increasingly demanding global solutions as the colocation industry continues to grow at double digit rates, and IXEurope has become one of the top providers of colocation services in Europe, operating high-quality data centers in key markets."
The acquisition will be financed out of Equinix corporate cash reserves and unsecured debt financing under existing debt facilities from Citigroup.
The current management team, including Guy Willner, IXEurope CEO, and Christophe de Buchet, IXEurope COO, will join Equinix and continue to operate the European business. Equinix's European regional headquarters will be located in London.
"The combination of IXEurope's European reach and operational expertise with Equinix's existing global operations will further extend Equinix's market leading position and allow it to further leverage the tremendous growth opportunities that exist in the colocation market worldwide," said Willner.
Under the terms of the acquisition, IXEurope shareholders will receive 125 pence (approximately $2.50 per share) for each IXEurope share. Shares of IXEurope (UK:IXE) dropped 4.9% to 122.88 pence in early trading Thursday.