Equinix and Singapore in European Data Centre JV
A US $1 billion joint-venture between U.S. data centre operator Equinix and GIC, the government of Singapore's sovereign wealth fund, will meet the requirements of hyperscale data centre operators in Europe by developing new data centres utilising the xScale platform.
The initial facilities in the joint venture will serve the core workload deployment needs of a targeted group of hyperscale companies, including the world's largest cloud service providers. Facilities on or near some of Equinix's existing IBX® campuses will allow these key enablers of digital transformation to streamline their continued growth, whilst strengthening the company's position as a leader in the cloud ecosystem at a time when enterprises are increasingly embracing hybrid multicloud as the IT architecture of choice.
For years, hyperscale operators, including Alibaba Cloud, Amazon Web Services, Microsoft Azure, Oracle Cloud Infrastructure and Google Cloud, have partnered with Equinix to leverage its global platform of 200 International Business Exchange™ (IBX) data centers to directly connect to their strategic business partners and customers.
Today, Platform Equinix® offers the largest number of access points—the "on- and off-ramps to the cloud"—to top global cloud service providers. In addition to these customer access points, hyperscale companies are investing in large-scale data center deployments to accommodate their rapidly growing core workload needs. With xScale data centers, hyperscale companies will now be able to add core deployments at Equinix to their existing access point footprints, enabling their growth on a single platform that spans more than 50 global metros and offers direct interconnection—within a vibrant set of ecosystems—to their customers and strategic business partners.
As hyperscale companies scale their operations at Equinix through xScale data centers and further leverage direct access to the business ecosystems of Equinix's global platform, the "network effect" will also benefit other companies operating at Equinix, including companies with existing direct connections to hyperscale access points at Equinix. The deployment of core hyperscale infrastructure at Equinix through xScale data centers will serve as a magnet, attracting additional partners, application developers and other hyperscale vendors to Equinix's ecosystem, increasing the choice and innovation opportunities for current Equinix customers.
Under the terms of the agreement which was brokered by Citi and is expected to close in the third quarter of 2019, GIC will own 80 per cent of the equity in the new joint venture, with Equinix taking a minority stake of 20 per cent, with Equinix additionally expected to sell both its London LD10 (retaining part of that business under a lease back) and Paris PA8 IBX data centers and the associated leases, as well as certain other development interests, to the joint venture company.
Commenting on the development, Equinix President and CEO, Charles Meyers, said:
"It has been a long journey to reach this point, but we are tremendously excited to announce the formation of our first xScale data centers joint venture. Partnering with a world-class investment partner like GIC will provide the opportunity to make significant capital investments in order to capture targeted large-footprint deployments while continuing to optimize our capital structure. The JV structure will enable us to extend our cloud leadership while providing significant value to a critical set of hyperscale customers. We look forward to launching similar JVs in other operating regions and believe that these efforts will continue to further differentiate Equinix as the trusted center of a cloud-first world."
Kelly Morgan, Vice President for Datacenter Infrastructure and Services at 451 Research, adds:
"As hyperscale companies expand around the world, they will increasingly look to partners to provide both broad global scale and deep local knowledge when deploying data center space. Equinix, with its track record of operational reliability, along with expertise in financing, permitting and building data centers globally, is an example of a partner that can provide a platform for top hyperscale companies to scale core workload operations as well as interconnected access points within an ecosystem of partners and customers. By increasing the number of hyperscale facilities in the EMEA region, the joint venture between Equinix and GIC aims to accelerate the adoption of hybrid and multicloud as the IT architecture of choice by companies throughout the region."