Following the acquisition of four data centers in Chile from Empresa Nacional De Telecomunicaciones (Entel), a prominent Chilean telecommunications company, Equinix has expanded its data center colocation and interconnection services further into Latin America.
Equinix has also inked an agreement to purchase one more data center in Peru, also from Entel, subject to closing conditions. At current currency rates on the signing dates, the enterprise value of the five data centers is roughly $735 million.
The five facilities generate approximately $55 million of annualized revenue using current exchange rates in effect on the dates of signing and represent a purchase multiple of approximately 23x EV / 2021 adjusted EBITDA including Equinix SG&A expenses.
Equinix will expand its platform to the Southern Cone through the acquisition, bringing its footprint to five Latin American countries: Brazil, Chile, Colombia, Mexico, and Peru, where it will operate 16 IBX data centers in seven metros.
The four data centers in the Santiago, Chile metro include:
The Ciudad de las Valles location, with two data centers totaling around 170,000 gross square feet, is Santiago’s largest multitenant data center site, with plenty of room for development.
The property in downtown Santiago is roughly 46,000 gross square feet. It’s a network-dense facility next to the Entel Tower, an important internet exchange facility in the local government center.
Customers, notably financial institutions, would benefit from the roughly 31,000 gross square foot data center facility in Longovilo, which is strategically positioned away from the city center to suit backup and disaster recovery needs.
Entel Employees and Contractors
Under the terms of the arrangement, about 100 Entel workers and contractors will become Equinix employees or contractors.
More than 100 Entel clients who now use the four data centers will switch to Equinix, with more than 75 of them being new to the company. Over 20 network service providers (NSPs) and a robust financial services ecosystem with significant local and worldwide firms are among the gained clients, who come from a variety of industries.
Equinix has a ten-year presence in Latin America, with 11 International Business Exchange (IBX) data centers in Brazil, Colombia, and Mexico. The addition of four new data centers in the strategic Santiago, Chile metro – a growing data center and technology hub – would give local businesses and multinational corporations the opportunity to accelerate their digital transformation in this region by co-locating their IT infrastructures with Equinix.
Following the completion of the business integration, Equinix expects to offer a comprehensive range of interconnection and digital services to the four data centers in Chile, including Equinix Fabric, Network Edge, Equinix Internet Exchange, Equinix Internet Access, and Metro Connect. Customers in Chile would be able to connect in real time, directly and discreetly, to more than 10,000 organizations through Platform Equinix, including more than 2,000 networks and 3,000 cloud and IT service providers, for greater performance, security, and scalability.
“We continue to see demand from businesses in Latin America, across all sectors, looking to transform their operations to be digital and cloud-enabled,” said Tara Risser, President Americas at Equinix. “Equinix’s expansion into Chile and Peru accelerates digital transformation opportunities in this rapidly growing region and is a critical step in our long-term strategy to broaden digital access for our customers globally. Chile’s access to sustainable energy sources such as solar, hydro and wind helps our customers in the region – as well as multinationals doing business with them – to grow responsibly and sustainably, which aligns with our global sustainability strategy.”