Equinix announces $175m acquisition of three Axtel data centers in Mexico

Maria Nikolova

This is an all-cash deal for the acquisition of three data centers that serve the Mexico City and Monterrey metro areas of Mexico.

Global interconnection and data center company Equinix Inc (NASDAQ:EQIX) today announces it has entered into an agreement with Axtel S.A.B. de C.V. (BMV: AXTELCPO) to acquire three data centers that serve the Mexico City and Monterrey metro areas of Mexico.

This is a US$175 million all-cash deal. The acquisition is expected to close in the first quarter of 2020, subject to customary closing conditions including regulatory approval. Upon closing, Axtel will be a customer and a strategic marketing partner in Mexico, and Axtel will retain a small minority ownership position in the three sites.

The three facilities generated approximately $21 million of revenues in the 12 months ending December 31, 2018, with an EBITDA margin profile accretive to the Equinix business.

The first facility is a 110,000 gross-square-foot data center with 37,000 square feet of colocation space. It is the first data center in Latin America with an energy cogeneration system. It also features ICREA (International Computer Room Experts Association) certification.

The second facility is currently an 80,000 gross-square-foot data center with 6,000 square feet of colocation space. This facility will provide Equinix with expansion opportunities of up to 60,000 square feet of colocation space.

The Monterrey area facility is a highly connected data center offering a key connectivity gateway between the U.S. and Mexico. It features 25,000 gross square feet of data center space with 12,500 square feet of colocation space. It is a carrier-neutral facility with 10 network service providers.

Equinix plans to offer Equinix Cloud Exchange Fabric (ECX Fabric) in all three data centers.

The deal is in line with Equinix’s strategy of expanding into attractive large-growth markets. This acquisition, when combined with the previous acquisitions of key traffic hubs in Dallas (Infomart) and Miami (NAP of the Americas), is set to further strengthen Equinix’s global platform by increasing interconnection between North, Central and South America.

At present, Equinix serves several Mexican businesses in IBX data centers outside of Mexico, such as the Mexican Stock Exchange in New York and multiple Mexican network service providers in Dallas.

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