Equinix To Acquire Three Axtel Data Centers As Global Expansion Continues

'The three Axtel data centers that serve the Mexico City and Monterrey metros provide an optimal market entry for Equinix to bolster operations in the region and facilitate even greater interconnection within the Americas region,' says Jon Lin, president of the Americas for Equinix.

Equinix plans to acquire three data centers in Mexico from Axtel SAB for $175 million as the data center giant continues its global expansion into new markets.

Buying Axtel’s three data centers, which generate $21 million in annual revenue by serving the Mexico City and Monterrey regions, will immediately make Equinix one of the largest network-neutral data center operators in Mexico.

“Customers are seeking new locations to keep their data in proximity to points of consumption and, as a part of this evolution, our enterprise and service provider customers have a strong desire to interconnect at the digital edge in Mexico,” said Jon Lin, president of the Americas for Equinix, in a statement.

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Equinix said that combining the three new data centers with its previous acquisitions made in key traffic hubs of Dallas and Miami will boost the company’s global platform by increasing interconnection throughout the Americas. The Redwood City, Calif.-based co-location giant has dozens of data centers scattered across the U.S. as well as facilities in Toronto, Sao Paulo, Rio de Janeiro and Bogota, Colombia. The company owns over 200 data centers in more than 50 markets across the globe.

“The three Axtel data centers that serve the Mexico City and Monterrey metros provide an optimal market entry for Equinix to bolster operations in the region and facilitate even greater interconnection within the Americas region and between the Americas, Asia, Australia and Europe,” said Lin.

The data center market is on fire in terms of the amount of acquisitions being made in 2019. The market is on pace to break the record this year after a whopping 52 data-center-oriented acquisitions closed in the first half of 2019, according to Synergy Research Group.

Equinix and Digital Realty are leading the M&A charge and in aggregate accounted for 36 percent of the value of deals closed over the past four years. In April, Equinix acquired Switch Datacenters’ AMS1 data center business in Amsterdam for $34 million to expand its worldwide presence.

In 2013, Mexico approved major telecommunications reform that has created opportunities for businesses seeking to expand into the country. Equinix said this opens uncaptured market demand in the region for interconnection and data center services as bandwidth and demand increase.

Axtel’s two data centers that serve Mexico City metro are carrier-neutral facilities with multiple fiber entry points that include five network service providers currently operating within each data center. One center is 111,000 square feet, while the other is 80,000 square feet. The third data center located in Monterrey is 25,000 square feet and is a highly connected facility offering a key connectivity gateway between the U.S. and Mexico.

Equinix will provide its on-demand, software-defined networking Equinix Cloud Exchange Fabric in all three data centers. This allows businesses to connect between their own infrastructure and any other company’s distributed infrastructure.

Approximately 40 Axtel employees and operators are slated to join the Equinix team. The $175 million all-cash deal is expected to close in the first quarter of 2020.