Equinix, Inc. (Nasdaq: EQIX), said it has completed the acquisition of U.S. interconnection hub Infomart Dallas from ASB Real Estate Investments. The $800 million debt and cash transaction includes the Infomart Dallas operations and tenants.
In 2017 the Infomart building generated approximately $50 million of revenues, and nearly $20 million of that was from Equinix rent and maintenance recoveries. According to Equinix, the Infomart gives it expansion opportunities through the current underdeveloped capacity, along with the potential to develop additional capacity on land adjacent to the Infomart building.
Equinix expects this transaction to be adjusted funds from operations (AFFO) per share breakeven one year from closing. There is a sizable AFFO benefit from the potential development of the adjacent land as well.
The 1.6 million gross-square-foot Infomart includes several diverse fiber entry points, and over 50 tenants, such as networks, colocation providers, and office tenants. It is currently home to Equinix Dallas International Business Exchange (IBX) data centers DA1, DA2, DA3, and DA6, which combined support nearly 3,500 built out cabinets and house over 100 network service providers.
The Infomart acquisition will expand Equinix capabilities by improving interconnection density on the Equinix platform worldwide, offering opportunity for improved business relationships in the banking, technology, energy, and healthcare industries.
In February, Equinix announced that it had entered into the definitive agreement to acquire Infomart Dallas (see "Equinix to expand footprint with purchase of Infomart Dallas"). With the acquisition, Equinix is positioned to expand in the Dallas metro market, which it attests is an important interconnection point for LATAM traffic with major terrestrial routes in Central and South America. According to Equinix, this will complement its strategy to build on its operations in Miami, Los Angeles, Bogotá, Sao Paulo, and Rio de Janeiro, and expand services to enterprise, cloud, and content providers that focus on the Latin American market.
"The Dallas metro region has long been a major internet and network peering exchange point and is a major communications hub for the southern United States," said Karl Strohmeyer, Equinix president, Americas. "The addition of the Infomart to the Equinix portfolio supports our ongoing global expansion while further enabling the U.S. digital economy."
Equinix says that 28 Infomart employees and contractors, mainly in operations positions at the acquired facility, have become contracted or employed by Equinix as part of the transaction.
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