Equinix said its acquisition of TelecityGroup would be better for shareholders than a Telecity-Interxion merger

Equinix confirmed it is currently in discussions which could lead to its acquisition of UK datacentre specialist TelecityGroup, a move it said would significantly enhance its standing in the region.

The American datacentre incumbent last week offered TelecityGroup £2.3bn in a cash-and-shares deal that would see Equinix acquire its assets, a move that would likely jeopardize a recent Telecity merger proposal with Interxion.

Telecity has a market cap of about £1.4bn with datacentres dotted around Northern Europe; Interxion is valued at £1.27bn and has close to 40 datacentres all over the Europe.

“The Board of Equinix believes that this opportunity represents attractive shareholder value creation potential for Equinix, complementing and extending Equinix’s geographic footprint in Europe and enabling increased network and cloud density to better serve customers,” the company said in a statement.

“In the United Kingdom, the acquisition of TelecityGroup would add capacity in Central London and Docklands that would complement the focus of Equinix’s current operations in Slough. Additionally, the acquisition would add capacity in several of Equinix’s current locations throughout Europe, and extend Equinix’s footprint into new locations with identified cloud and interconnection needs including Dublin, Helsinki, Istanbul, Milan, Stockholm and Warsaw.”

“In addition, the Board of Equinix believes that a potential transaction with TelecityGroup would create a more compelling combination than the proposed merger with Interxion Holding N.V. and would deliver greater value for TelecityGroup shareholders,” the company added.

Equinix, which has a month to firm up its final offer to Telecity, has well over 100 datacentres in about 15 countries, and most of those are concentrated in major metropolitan areas.