Equinix announces $750m acquisition of 13 Bell data center sites

Maria Nikolova

The 13 data center sites are expected to generate $105 million annualized revenue, which represents a purchase multiple of approximately 15x EV / adjusted EBITDA.

Global interconnection and data center company Equinix Inc (NASDAQ:EQIX) today announced its entry into a definitive agreement to purchase a portfolio of 13 data centers across Canada from BCE Inc. (Bell) for US$750 million (CA$1,041 million) in an all-cash transaction.

The 13 data center sites, which represent 25 Bell data center facilities, are expected to generate approximately US$105 million (CA$150 million) annualized revenue, which represents a purchase multiple of approximately 15x EV / adjusted EBITDA. The acquisition is expected to close in thee second half 2020, subject to customary closing conditions including regulatory approval. The deal is set to be immediately accretive to Equinix’s adjusted funds from operations (AFFO) per share upon close, excluding integration costs.

The addition of these strategic assets, their associated operations and the more than 600 customers operating within the data centers are poised to further strengthen Equinix’s global platform, which currently includes more than 210 data centers across 55 metros. It will benefit businesses by: increasing interconnection within Canada and between Canada and the rest of the world, opening seven new metros in six provinces to extend the digital edge of Platform Equinix®, and adding key customers in strategic sectors to further increase the value of the ecosystem available at Equinix. Under the terms of the agreement, Equinix and Bell will begin a strategic partnership to enable enterprises in Canada to leverage hybrid multicloud solutions to accelerate their digital transformation.

In addition to adding new capacity in Toronto, Ontario, where Equinix currently operates two International Business Exchange™ (IBX®) data centers, it will extend Equinix’s interconnection services to seven new metros. These metros include Calgary, Alberta; Kamloops and Vancouver, British Columbia; Millidgeville, New Brunswick; Montreal, Quebec; Ottawa, Ontario; and Winnipeg, Manitoba.

The 13 data centers, six of which are owned assets, will add approximately 1.2 million gross square feet of data center space and 400,000 square feet of colocation space to Platform Equinix. The facilities will also provide a platform for future expansion in Canada.

Over time, Equinix plans to introduce Equinix Cloud Exchange Fabric™ (ECX Fabric™) to all 13 data centers. ECX Fabric is an on-demand, SDN-enabled interconnection service that allows any business to connect between its own distributed infrastructure and any other company’s distributed infrastructure, including the world’s largest network service and cloud providers, on Platform Equinix.

Citi and J.P. Morgan acted as financial advisors to Equinix.

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