Equinix and GIC, Singapore’s sovereign wealth fund, announced a US$1.0 billion initial joint venture to develop and operate xScale data centers in Japan. GIC will own an 80% equity interest in the joint venture and Equinix will own the remaining 20% equity interest. GIC is expected to have contributed cash to fund its 80% equity interest in the joint venture. Equinix is expected to have transferred its Tokyo TY12 and Osaka OS2 development assets, along with development rights and the land for an additional data center in Tokyo, to the joint venture in return for a 20% equity interest in the joint venture and net cash proceeds in excess of US$100 million. Financing for the joint venture is expected to close in 2H 2020.
The three initial facilities in the joint venture – one in Osaka and two in Tokyo — will serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world’s largest cloud service providers.
Highlights:
- The initial three facilities included in the joint venture will provide approximately 138 megawatts (MW) of power capacity to the Osaka and Tokyo markets when fully built-out.
- xScale data centers offer access to Equinix’s comprehensive suite of interconnection and edge services. These services will tie into the hyperscale companies’ existing access points at Equinix, thereby increasing the speed of connectivity to their existing and future enterprise customers.
- xScale data centers are engineered to meet the technical and operational requirements and price points of core hyperscale workload deployments. This enables hyperscale companies to consolidate core and access point deployments into one global provider to streamline and simplify their rapid growth.
- Platform Equinix offers the most access points—the “on- and off-ramps to the cloud”—to the top global cloud service providers. As hyperscale companies scale their operations at Equinix, the ecosystem of nearly 10,000 enterprises and other companies currently operating at Equinix benefit from increased opportunities to directly connect and operate in proximity to the largest global cloud operators.
Charles Meyers, President and CEO, Equinix, states: “Hybrid and multicloud have emerged as the clear IT architecture of choice, and Equinix is continuing its efforts to satisfy both the interconnection and core workload needs of the top hyperscale and cloud companies powering this infrastructure. Following our successful partnership with GIC on the initial xScale data center joint venture in Europe announced last year, we are now continuing our partnership with the formation of a new joint venture in Japan. The new facilities under this JV will allow our hyperscale customers to streamline their continued growth, while strengthening Equinix’s leadership position in the cloud ecosystem.”
Equinix partners with Singapore’s GIC on xScale Data Centers in Europe
Equinix has formed a joint venture with GIC, Singapore’s sovereign wealth fund, to develop and operate xScaleTM data centers in Europe. The joint venture is initially valued at over $1 billion.
Equinix said initial facilities in the joint venture will serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world’s largest cloud service providers. The facilities will be located on or proximate to some of Equinix’s existing IBX campuses.xScale data centers will be managed and staffed by Equinix while ensuring seamless connectivity to the Equinix global platform, providing a consistent experience for the hyperscale companies.
Equinix cites two ways in which the new xScale data centers will provide hyperscale companies a differentiated value proposition from existing wholesale data center operators in two key areas:
xScale data centers will offer access to Equinix’s comprehensive suite of interconnection and edge services. These services will tie into the hyperscale companies’ existing access points at Equinix, thereby increasing the speed of connectivity to their existing and future enterprise customers.
xScale data centers will be engineered to meet the technical and operational requirements and price points of core hyperscale workload deployments. This enables hyperscale companies to consolidate core and access point deployments into one global provider to streamline and simplify their rapid growth.
Equinix has been working for years with hyperscale operators, including Alibaba Cloud, Amazon Web Services, Microsoft Azure, Oracle Cloud Infrastructure and Google Cloud. Currently, global deployments from the top hyperscale companies exceed $500 million in annual revenue at Equinix, with interconnection-rich retail deployments representing the most rapid growth segment of their deployments.
Under the deal, GIC will own an 80% equity interest in the joint venture and Equinix will own the remaining 20% equity interest. Equinix will 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. A significant portion of London LD10 and Paris PA8 are already leased.
The cmpanies envision additional new xScale data centers in Amsterdam, Frankfurt (two sites) and London. These initial six facilities, when fully built out, will provide approximately 155 megawatts (MW) of power capacity.
