Digital Realty is acquiring Telx to bolster its US datacentre footprint

Digital Realty is to acquire cloud and colocation solutions specialist Telx for $1.9bn in a move the company said would double its datacentre footprint in the US.

Telx is a direct competitor of Equinix and offers a combination of interconnection, cloud and colocation services to enterprises and IT service providers and as of March this year the company managed 1.3 million square feet in 20 facilities across the US – 11 of which are already being leased from Digital Realty.

“This transformative transaction is consistent with our strategy of sourcing strategic and complementary assets to strengthen and diversify Digital Realty’s datacentre portfolio and expand our product mix and presence in the attractive colocation and interconnection space,” said William Stein, Digital Realty’s chief executive officer.

“Telx’s well-established colocation and interconnection businesses provide access to two rapidly-growing segments with long-standing customer relationships in top-tier metropolitan areas such as New York and Silicon Valley.”

“The fact that more than half of Telx’s 20 facilities are run out of Digital Realty properties further highlights the strategic fit as well as the potential incremental revenue opportunities we expect to be able to pursue as one company on a global basis.  This transaction advances our objective of ensuring that Digital Realty’s suite of products and services is able to best serve our customers’ current and future datacentre needs,” Stein added.

Chris Downie, chief executive officer of Telx said: “The combination of Telx’s colocation and interconnection capabilities with Digital Realty’s expansive wholesale platform provides greater flexibility and optionality for our customers and creates a global solutions provider covering wholesale customer applications and smaller performance-oriented deployments in select high-growth urban submarkets across the US.”

The transaction is due to close later this year.